India has restarted the export of key commodities including tea, rice, fruits, coffee, seafood and confectionery, experts noted. Russia has reportedly started importing goods from India as banks run by Sberbank, Russia’s biggest lender, facilitate bilateral trade between the two historic allies by transporting shipping containers through ports in Georgia. It comes as Mr Johnson travels to India to try to strike a £28billion-a-year trade deal with his Indian counterpart Narendra Modi.
Ajay Sahai, Managing Director and CEO of the Federation of Indian Export Organizations, said: “The transactions are taking place through Sberbank.”
Trade between Moscow and New Delhi has been temporarily halted as Western sanctions created a sense of uncertainty for Indian businesses after Putin’s February 24 invasion of Ukraine.
The trade is facilitated mainly by a ruble-ruble route, with some banks offering payments in euros, insiders told the Economic Times, an Indian publication.
Ashwin Shah, Director of Shah Nanji Nagji Exports, one of the leading rice exporters to Russia, said, “We have just shipped 60 containers of non-basmati rice to Russia, each weighing 22,000 kg.
“Payment for our rice is handled by Russia-based Alfa Bank. Bank of Maharashtra is our Indian bank.”
These exports to Russia are helping to soften the impact of Western sanctions on Putin, with reports suggesting the country’s grocery stores are running out.
Mohit Agarwal, Director of Asian Tea, a major exporter, said, “Tea exports to Russia have started and we have just shipped five containers to Russia.”
For Indian tea makers, Russia is a major market, importing 43 to 45 million kg per year.
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Industry sources at the Economic Times say trade relations between the two countries will grow further, with more items expected to be exported to Russia shortly.
India and Russia have been allies since the 1970s, with India relying on Russia’s right of veto at the UN to protect itself from any adverse statements on Kashmir.
Meanwhile. New Delhi is also heavily dependent on Moscow for its weaponry, with around two-thirds of India’s arsenal being Soviet or Russian-made.
The resumption of trade between India and Russia could complicate Mr Johnson’s visit to New Delhi, with journalist Naomi Canton noting that India’s neutral position in the face of the Russian invasion of Ukraine could be a ” blocking point”.
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Mr. Johnson seeks to establish trade, security and diplomatic ties with one of the world’s fastest growing emerging powers and economies.
He said: “As we face threats to our peace and prosperity from autocratic states, it is vital that democracies and friends remain united.
“My visit will focus on the things that matter – from job creation and economic growth to energy security and defence.”