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The two-day second Indo-Russia forum on trade and investment jointly organised by industry bodies, CII and FICCI, got underway on Tuesday in New Delhi. The Russian Premier Victor Zubkov was the guest of honour.
On the first day both countries have also agreed to work on an efficient shipment route to reduce the transportation costs in their bid to double trade between the two nations. They also signed an agreement to set up a joint working group (JWG) for checking customs offences and decided to operationalise the task force on trade and investment.
The task force is also considering opening Markets by a Comprehensive Economic Cooperation Agreement (CECA). Speaking on the issue the Russian Prime Minister said that in the last three years bilateral trade between India and Russia increased by 30 percent touching $ 5 billion, stating that by 2010 he hoped that the figure will rise to $10 billion if trade between the two countries continued to grow at the rate of 30 percent per year.
"If we grow by 30% per annum, we might achieve the $10 billion target by 2010," Mr Zubkov said.
Blaming high transportation costs for low trade volumes, Commerce and Industry Minister Mr. Kamal Nath who was also present in the meeting said, "Currently, the lack of an efficient shipment route pushes up freight costs. But we can work our way around this problem. The north-south corridor provides the shortest link between India and Russia through Iran and the Caspian Sea. The corridor could help reduce costs by nearly one-third."
Mr. Nath also expressed that only "Sky is the limit" between the increase of trade and partnership between India and Russia. Now more and more Indian companies were investing in Russia in diversified fields such as IT, pharmaceuticals, manufacturing, telecom and many others, he said.
Nath said while not many Indian IT Companies had started operations base in Russia, the situation was now changing with "India’s largest software developer Tata Consultancy Services planning to set up a representative office in Russia by March 2008."
Around 500 business delegates from India and Russia attended the conference including many prominent bankers and market leaders from both the sides.
The summit will continue till February 13.
The second day's was co-chaired by Mr Kamal Nath, Union Minister of Commerce and Industry, along with Mrs. Elvira. S. Nabiullina, Minister of Economic Development & Trade of the Russian Federation.
Mrs. Nabiullina participated along with a high profile Russian delegation, including government officials and businessmen. The Indian delegation included representatives from the Ministry of Commerce & Industry and Ministry of External Affairs and businessmen and representatives from the Confederation of Indian Industry (CII), Federation of Indian Chambers of Commerce & Industry (FICCI) and Associated Chambers of Commerce & Industry (ASSOCHAM).
Speaking on the occasion, Mr. Nath mentioned about the positive investment climate in India as also the huge investment opportunities in infrastructure, metallurgy, real estate, pharmaceuticals and other sectors. He emphasized that the level of economic engagement between the two countries, in terms of trade and investment relations, should increase.
A Protocol was signed by Mr. Kamal Nath and Mrs. Nabiullina, underlying to resolve to cooperate in several spheres of mutual interest as mentioned above.
It was decided by both the sides that enhancement of the bilateral investment and trade cooperation is one of the important steps to advance qualitatively trade and economic relations and to widen strategic partnership and cooperation between India and Russia. Both sides also agreed on early commercialisation of new and innovative technologies as one of the prospective spheres of cooperation.
The next meeting of the Forum would be held in 2009 or earlier in Russia on a mutually agreed date
India’s export to Russia was US $ 1.10 billion in 2006-07 while its import was US$ 2.99 billion. India has received FDI of US$ 94.0 million from Russia so far. Some of the sectors attracting FDI from Russia are chemicals, telecommunications, trading and consultancy services. Indian approved investment in Russia, on the other hand, amounts to US $ 2839.6 million up to March, 2007.
The second day also saw four parallel sessions being held on sectors of mutual interest such as mines and minerals, energy & power, transport & infrastructure including inland waterways, ports, railways construction, civil aviation & automobiles, pharmaceuticals, biotechnology, IT, chemicals, Telecom and High Technology.
The India-Russia Forum on Trade & Investment was set up on March 16, 2006 through the signing of a Joint Communiqué between the Ministry of Commerce & Industry of India and the Ministry of Economic Development & Trade of the Russian Federation. It was felt that there is a need to strive for stable development of Indo-Russian trade, economic and investment cooperation.
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