ST.PETERSBURG: India and Russia today pledged for early commencement of negotiations for a free trade agreement between New Delhi and the five-nation Eurasian Economic Union (EAEU).
The issue was discussed during a meeting between Prime Minister Narendra Modi and Russian President Vladimir Putin.
"We acknowledge the importance of developing economic cooperation at the regional level. We will facilitate an early commencement of negotiations on a free trade agreement between the Eurasian Economic Union and India," said a vision document issued after the Modi-Putin talks.
A joint feasibility report on the proposed agreement was completed last year. It has concluded that the proposed pact is feasible and mutually beneficial with substantial potential welfare gains and augmentation in trade in goods, he said.
Under the free trade pact, two trading partners reduce or eliminate duties on most of the goods traded between them.
Besides norms are also liberalised to promote trade in services sector and boost investments.
India has implemented such agreements with several countries including Japan, South Korea and Singapore.
EAEU region holds huge potential to increase trade. It has a population size of over 180 million.
The two leaders also said that their major economic objectives include expanding trade and investment.
Both express desires to increase industrial cooperation, improving environment for entrepreneurship and investments and developing cooperation in banking and financial matters.
"As the next stage of our strategic partnership, we will extend our bilateral, technical, economic and scientific cooperation to third countries by undertaking joint development projects in mutually agreed sectors," it said.
India and Russia will also coordinate their efforts to promote settlements of "India-Russian trade in national currencies" to reduce dependence of bilateral trade on other currencies, it added.
"We will jointly encourage our business communities to use the existing workable schemes and mechanisms for settlements in national currencies elaborated by the Reserve Bank of India and Bank of Russia," the document said.
On increasing cooperation in the diamond sector, it said the leaders agreed to intensify efforts to counter undisclosed synthetic stones entering diamond market and to support development of generic marketing programmes for diamonds.
"We will work together to improve market access for agriculture and food commodities in each other's country and develop joint strategies through research and development for utilisation of existing potential in the agri and food processing sector," it added.