India, Russia push for broader economic partnership beyond oil and arms

The time-tested partners India and Russia moved towards more balanced, diversified economic ties in 2025, as both sides realised the need to expand bilateral trade beyond defence and energy sectors. During Russian President Vladimir Putin's visit to New Delhi in December, India and Russia unveiled a raft of measures, including a five-year roadmap to build a robust economic partnership and addressed India's concerns over trade deficit. Prime Minister Narendra Modi also conveyed to President Putin that the war in Ukraine must be brought to an end through peaceful means.

Prior to his visit to India, when asked about the US threat to impose high tariffs and sanctions on Russia's key partners, Putin stated that the Indian people would not tolerate their country being bullied into making a decision that contradicted their national interests and priorities, as reported by the RT news channel. “(India) will never allow itself to be humiliated by anyone. I know Prime Minister Modi, he will also not make any such decisions,” he had said. He was referring to the additional 25 per cent tariff imposed by President Donald Trump on New Delhi as a penalty for its purchases of Russian oil, taking the total levies imposed on India by the US to 50 per cent.

New Delhi has described these duties as “unfair, unjustified and unreasonable.” Meanwhile, the key outcome of the 23rd India-Russia Annual Summit held in New Delhi was the signing and approval of 30 documents that form a long-term foundation for expanding trade, economic, and investment cooperation, including on non-nuclear (powered) shipbuilding, and the training of Indian sailors for polar shipping. “We are witnessing a shift from a general exchange of interests to the substantive development of specific cooperation formats—from joint R&D and technology transfer to the creation of production capacities and the development of long-term cooperation chains,” Russia's trade representative in India, Andrey Sobolev, told media.

Sobolev said that both countries are showing mutual interest in establishing joint ventures and localising their production in their respective territories. Russian companies view India as a promising platform for localising production, targeting both the domestic market and expanding into South Asian and third-country markets, while Indian businesses are increasingly exploring opportunities in the Russian market, he added. Meanwhile, many observers tend to believe the potential of Indo-Russian bilateral cooperation is almost exhausted, and the problematic supplies of Russian discounted crude are likely to dry up under pressure from Western sanctions.

Both sides believe in the need for expanding bilateral trade beyond the massive crude supplies at a discounted price. "India, being and remaining a sovereign nation, carries out foreign trade operations and purchases energy resources where it is beneficial for itself," the Kremlin spokesman Dmitry Peskov declared in an after-summit briefing.