Modi in Moscow: How New Delhi strikes a delicate balance between Russia and the West

Narendra Modi visited Russia earlier this month for his first overseas bilateral visit after assuming office as India’s prime minister for the third time. This also meant a resumption of the practice of summit-level meetings between the two sides, last held in December 2021 when Russian President Vladimir Putin visited India.

Given that this was Modi’s first bilateral visit to any foreign country after taking charge, diverting from the practice of visiting neighbors, it has been seen as an important signal about India’s multi-alignment strategy. Putin, too, has notably visited China, North Korea, and Vietnam since his reelection earlier this year.

In this regard, engagement with India remains a crucial part of Russia’s strategy towards the East, where a lack of high-level interaction would be concerning amidst tense relations with the West.

While the Indian Ministry of External Affairs sought to downplay any particular significance regarding the scheduling, noting that the summit was of great importance and it was a priority due to the gap of two years, the message that went out was quite different. The visit was seen not only as the reiteration of the continued importance of Russia in Indian foreign policy, but also demonstrated the need to provide a fresh direction to the strategic partnership amidst turbulence in the international system.

For Russia too, Modi’s visit underlined its focus on engaging with the East and helped bolster the message that it is not isolated. Russian presidential spokesperson Dmitry Peskov captured the sense on the Russian side when he argued that the West was “jealous” of the scheduled meeting between the two leaders. The optics that followed from the time Modi touched down in Moscow to the informal dinner with Putin, to the amiable formal discussions and presenting of the Order of St. Andrew the Apostle to the Indian prime minister – all together presented a picture of a friendly, cordial engagement with wide-ranging discussions on issues that concern both sides.

The geopolitical signaling gained further importance as the meeting almost coincided with the NATO summit in Washington. But India has sought to continue its policy of strategic autonomy and of walking a tightrope in its engagement with Russia. This has been visible in how India has reiterated its commitment to territorial integrity and sovereignty but abstained from UN resolutions on the Ukraine conflict while calling for dialogue.

It participated in the peace summit in Switzerland but did not sign the outcome document, citing the need for both sides of the conflict to be present. While highlighting the role of Russia in India’s energy security and giving a pointed message to the West on the issue of oil imports, Modi also levelled criticism at Moscow.

Beyond the optics

It was clear that after a two-year gap, both sides had much to talk about. They have important ongoing cooperation in the trade, energy, defense, nuclear, space, and multilateral spheres that make continued engagement important. The value they ascribe to each other in regional and global affairs – including on Afghanistan, West Asia, Central Asia etc. – also provides a basis for continued engagement.

However, given the fact that both sides publicized the optics so much – hours-long discussions between the two leaders, a friendly informal dinner, personal chemistry, etc. – it is remarkable that the summit ended without any major deal, mostly providing a vision for the future and signaling their intent to continue to build the relationship. India-Russia bilateral summits are usually a platform for big ticket announcements. For instance, in 2018 there was a record $5.5 billion arms deal, in 2019 they signed an agreement to create joint ventures and for the Indian defense sector to manufacture spare parts, and 2021 saw the agreement on a ten-year defense cooperation program as well as the setting up of the 2+2 defense and foreign ministers meeting format.

The Joint Statement following the 22nd India-Russia Annual Summit did highlight the extent to which economic ties were at the center of discussions as well as the gamut of areas of bilateral cooperation. A separate document containing the Joint Statement on the development of strategic areas of Russia-India economic cooperation for the period up to 2030 is a new development and a positive step in that it notes the steps both sides need to take to develop this area and suggests a way forward.

It highlights that economic development will take place in nine areas, including: the elimination of non-tariff barriers and possibility of the establishment of an EAEU-India Free Trade Area, the development of a bilateral settlement system using national currencies, an increase of cargo turnover with India through the launch of new routes of the North-South International Transport Corridor, the Northern Sea Route and the Chennai-Vladivostok Sea Line, an increase in the volume of bilateral trade in agricultural products, food and fertilisers, the development of cooperation in key energy sectors (including nuclear energy, oil refining and petrochemicals), the strengthening of interaction in infrastructure and industrial sectors, the promotion of investment in digital economy, the promotion of cooperation in the supply of medicine, and humanitarian cooperation.

This provides a good framework for the two sides to improve upon their economic ties, which dominated the discussions during this summit, wherein the leaders have now set a trade target of $100 billion by 2030.

However, the document does not contain any concrete deliverables and did not point to a decision on the resolution of long-standing issues, including on non-tariff barriers or connectivity. There was also no decision on any long-term energy contract, although negotiations are said to be ongoing and Rosneft head Igor Sechin was part of the Russian delegation during talks at the Kremlin.

The document does not specifically address worries about the high deficit, which touched $57 billion in 2023-24 on account of record oil imports by India, apart from Foreign Secretary Vinay Kwatra noting that Modi raised the issue of broadening the basket of goods for trade expansion and the manufacturing partnership as a way to give a fillip to the Make in India programme.

The Joint Statement also agreed to continue consultations for the interoperability of their financial messaging systems, which means no resolution has been achieved as yet. The negotiations for a Free Trade Agreement on goods between India and the Eurasian Economic Union were held in March 2024, which was noted as being an important step towards resolving tariff/non-tariff barriers in trade. They agreed to continue building on manufacturing cooperation, continue discussion on the Migration and Mobility Partnership Agreement and facilitate investments.

The statement lists cooperation in the Russian Far East and Arctic and counter-terrorism as separate headings, highlighting a new focus on these areas. The focus on connectivity was also highlighted in the plans to establish a joint working body for cooperation on the Northern Sea Route to develop shipping between India and Russia, which is a step forward from previous announcements. They also reaffirmed their focus on expanding links through INSTC, which has seen some movement forward in the past several years, and the Chennai-Vladivostok Maritime Corridor.

The reference to sovereignty and territorial integrity regarding the INSTC is the Indian signal towards the BRI, which it continues to oppose. Cooperation in energy, nuclear energy, space, science, and technology continues and has been highlighted as being a significant component of the bilateral partnership.

As both sides seek to shift the buyer-seller defense relationship to a more joint partnership format, they repeated their willingness to encourage the joint manufacturing in India of spare parts, components, etc. While this is not a new development, a Working Group on Technological Cooperation is expected to be set up during the next meeting of IRIGC-M&MTC. There was no expectation of any major defense deal to be signed during this summit due to a combination of factors including ongoing delays in supply, the focus of the Russian military-industrial complex on domestic needs, and the threat of Western sanctions. However, an intergovernmental agreement for enabling the manufacture of Russian Origin Spares in India was signed in 2023. It looks like the speculation regarding the signing of the Reciprocal Exchange of Logistics Agreement (RELOS) was unwarranted and the deal is yet to be ironed out.

Modi did receive assurances that Indians who joined the Russian army will be discharged and sent home, which had been a key agenda item for New Delhi. The Indian foreign secretary also noted after the summit that both sides would like to continue building on achievements in defense co-production and that the issue was discussed by the leaders.

In other words, while covering the usual bases, the joint statement did not contain any major new development on the bilateral front.

Apart from some MoUs, the two sides also unveiled the Programme of India-Russia cooperation in trade, economics, and investment in the Russian Far East for the period from 2024 to 2029, as well as of cooperation principles in the Arctic zone of the Russian Federation. The details of the programme have not been released, apart from the fact that it will provide a framework for further cooperation in the sectors of agriculture, energy, mining, manpower, diamonds, pharmaceuticals, maritime transport, etc. It is unclear if it contains any specific mandates.

Looking ahead

The visit was a sign of the role the two sides continue to play in each other’s foreign policy calculations and that they see value in remaining engaged at the highest level. The symbolism is hard to deny. In a broad sense, the two leaders have revealed their vision for bilateral ties and signaled their intention of continued collaboration.

The direction towards improving economic cooperation would be expected to bolster existing cooperation in areas like energy, space, nuclear, and defense that have traditionally been more prominent areas of bilateral engagement. The proposed opening up of two new Indian consulates in Kazan and Ekaterinburg points to the Indian desire to continue to build on existing ties. The ongoing participation in multilateral forums in a changing international system – the UN, G20, BRICS, and SCO – cannot be underestimated.

But the summit outcome documents also simultaneously reveal the scale of the task that lies ahead and challenges that will arise in transforming the relationship where old areas of cooperation are weakening and new ones are yet to be fully established. The lack of any concrete deliverables is a sign that much ground needs to be covered before a sustainable structure of India-Russia economic ties can be formed, manifold increase in oil imports notwithstanding.

The development of cooperation in areas of connectivity, Russian Far East, manufacturing, free trade area, not to mention the shifting of defense relations towards joint production, will not be an easy endeavor amidst an unstable international system where Moscow and New Delhi are being pulled towards rival major powers.

The multilateral engagement, especially in BRICS and the SCO alongside China, will also remain under scrutiny. It must be noted that Modi skipped the SCO summit in Astana in July 2024 in the backdrop of continued tense relations with China. In 2023, as the chair, India had held the SCO summit online. While important in the Eurasian space, contentious bilateral equations do pose a challenge in effective functioning of the grouping. It remains to be seen how an expanded BRICS will formulate its agenda in a united manner and whether Modi will travel to Russia for the second time in about three months for the summit in Kazan in October. Amidst growing talk of a multipolar world, whether these groupings can deliver results beyond their limited goals remains an open question.

India has had to work hard to strike a balance in its relations with the West and Russia, making it clear that it is not an anti-Western country, just a non-Western one.

While India remains worried about the increasing closeness of the Sino-Russian partnership amidst concerns about China’s rise, Russia is wary of New Delhi’s ties with Washington. The ongoing Ukraine conflict has further complicated these already complex dynamics that were exerting pressure on the India-Russia partnership.

The summit meeting did not lessen any of these challenges but did provide a glimpse of the value both ascribe to each other in their respective policies. It also reflected the understanding of the need to build new areas of bilateral cooperation to cope with changes in domestic and international scenarios. Whether the two sides can deliver on the ground with focused agreements to implement the outlined vision and whether the regional and global dynamics will facilitate or hinder the process remains to be seen.