Russia is committed to signing the free-trade agreement between India and the Russian-led Eurasian Economic Union as well as the bilateral agreement on services and investments, Russia’s First Deputy Prime Minister Denis Manturov said on Tuesday.

External Affairs Minister S Jaishankar and Manturov, who co-chaired the India-Russia Inter-governmental Commission on Trade, Economic, Scientific, Technological and Cultural Cooperation (IRIGC-TEC) on Tuesday, directed the working groups to take steps to enhance market access to achieve the bilateral trade target of $ 100 billion by 2030.

“Among other things, we confirm our strong commitment on signing the free trade agreement between the EAEU (Eurasian Economic Union) and India, as well as the bilateral agreement on services and investments. This fully meets the needs of our business community,” Manturov said in his address.

Two-day visit

Manturov, who is on a two-day official visit to India, called on Prime Minister Narendra Modi on Monday and met Finance Minister Nirmala Sitharaman and National Security Adviser Ajit Doval.

“Both sides also agreed to work towards developing a broad-based enabling framework for increasing economic engagement between the two countries,” per a press statement issued by the MEA after the IRIGC-TEC.

Jaishankar, in his opening address, said that India was confident of achieving $100 billion in annual bilateral trade with Russia well ahead of 2030 but reiterated that trade needed to be more balanced.

“Our goal is that it (bilateral trade) needs to be more balanced and that would require addressing current constraints and undertaking greater facilitative efforts. Making it easier to do trade should be accompanied by progress in the negotiations on the India-Eurasian Economic Union FTA,” he said. In FY24, Russia-India bilateral trade was at $66 billion. Russian exports to India were at a whopping $61.15 billion, mostly due to supplies of discounted oil, which led to a gaping trade deficit of $56.89 billion.

The Minister acknowledged that problems related to payments and logistics persisted but these were getting sorted out. The payment problems are mainly due to Russia facing economic and banking sanctions imposed by Western nations in response to its war against Ukraine.

“There have been challenges to trade, especially with regards to payments and logistics and perceptible progress has been made in that regard, but there is still some work to be done,” Jaishankar said.

Market access

Manturov’s support for the India-EAEU FTA is important for India as the agreement would open up access to the markets of the five resource-rich post-Soviet States including Russia, Belarus, Armenia, Kazakhstan, and Kyrgyzstan.

It could bring significant benefits to Indian exporters in sectors such as engineering goods, electronics, and agriculture and could also help the country counterbalance China’s influence in Eurasia, according to a government note.

Jaishankar, in his remarks, pointed out that Russia had emerged as a major source of fertilizers for India and its supply of crude oil, coal and uranium were important to the country. “Similarly, India’s pharmaceutical industry has emerged as an affordable and reliable source for Russia...Looking ahead we are also exploring the mobility of talent, skills, customising them for the Russian market has to be a shared enterprise,” he added.

The Minister also highlighted the various on-going connectivity projects that would serve both countries. “Our joint endeavours in regard to connectivity, such as the International North-South Transport Corridor, the Chennai-Vladivostok Corridor and the Northern Sea Route must go forward,” he said.

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