New Delhi, Sept. 10 -- India and Russia are fast-tracking negotiations for a new bilateral investment treaty (BIT) with an aim to provide legal certainty to investors of both countries, Commerce and Industry Minister Piyush Goyal said on Thursday.
Addressing the India-Russia Business Dialogue here with Russian Minister of Industry and Trade Anton Alikhanov, Goyal also said that both the countries are committed to the early conclusion of talks for the India- and Russia-led EAEU free trade agreement.
The five members of the Eurasian Economic Union (EAEU) are Armenia, Belarus, Kazakhstan, Kyrgyzstan and Russia.
The pact, he said, would open new markets for industries including MSMEs.
"We (India-Russia) are fast-tracking a new bilateral investment treaty to give investors on both sides the legal certainty that projects and businesses look for when they are finalising investment decisions," he said.
"We continue to strengthen local currency settlement mechanisms, because payment friction, more often than tariffs, is what slows trade down on the ground,"
he added.
Goyal called for an accelerated India-Russia economic and industrial partnership, urging businesses from both countries to work towards achieving the target of $100 billion in bilateral trade and $50 billion in two-way investment by 2030.
At present, the bilateral trade stands at $60 billion.
Increasing bilateral trade from the current base of around $60 billion would require adding about $40 billion in the next four years and sustained double-digit growth year-on-year, he said.
He stressed that achieving this would require significant efforts not only from the governments but equally from businesses in both countries.
Highlighting the opportunities for diversifying bilateral trade, Goyal said that Indian exports of meat and edible meat products had more than doubled from $36 million to $97 million, an increase of nearly 170 per cent.
Fish and aquatic products grew from $123 million to $159 million, an increase of nearly 30 per cent, while exports of edible vegetables rose from $38 million to $54 million, an increase of 40 per cent.
Similarly, shipments of coffee, tea and spices increased by 13 per cent to $116 million, while products of the milling industry had nearly doubled.
"These figures reflected growing demand in the Russian market for products from Indian farmers, food processors, micro, small and medium enterprises and MSME exporters," he added.
However, he said that only a small portion of the potential had been tapped so far.
Referring to the complementarity between the two economies, he said there were several products where Russia is a significant importer, and India is a significant exporter globally, but India is not yet a significant exporter to Russia.
He identified pharmaceuticals, auto components, tractors and food products among the opportunities waiting to be explored.
Further, the minister said that non-energy trade between the two countries remained much smaller than its potential and represented the headroom that needed to be filled to move bilateral trade from $60 billion to
$100 billion.
He said rebalancing bilateral trade through greater Indian exports of pharmaceuticals, engineering goods, chemicals, textiles, food products, marine products and auto products would be central to achieving the target.
On investment, Goyal said that the India-Russia priority investment projects mechanism is currently tracking 40 live investment projects across advanced manufacturing, energy, mining, railways and emerging technologies.
He called upon the Russian side to help open the doors wider for Indian investments in Russia in pharmaceuticals, IT, artificial intelligence, services, engineering and railways, so that the $50 billion investment target becomes genuinely a two-way
street.
He also highlighted investments in the physical backbone of the bilateral relationship, including the International North-South Transport Corridor and the Chennai-Vladivostok maritime corridor, stressing that connectivity is a part of trade policy and not merely infrastructure.
Published by HT Digital Content Services with permission from Millennium Post.