In a first, India to put dedicated cell to promote Russian investments

NEW DELHI: India for the first time will put in place a dedicated cell to promote Russian investments in the country to take forward St Petersburg vision statement that seeks to open new vistas of economic engagement. The idea to create this cell was mooted by PM Narendra Modi when he met CEOs of India and Russia in presence of President Vladimir Putin on June 1 after the annual summit in St Petersburg.

The cell which will report to the Prime Minister’s Office will assist Russian businessmen to plan, execute, form joint ventures and search locations for their investments. The entire process hopes to cut the alleged role of middlemen who in the past were matchmakers. This dedicated cell will function under ‘Invest India’ – investment wing of the Indian government – which was part of the June 1 CEO forum as well as St Petersburg International Economic Forum (SPIEF) where Modi was the Guest of Honour.


“This cell will be key to push Russian investments in India in non-traditional sectors with Delhi and Moscow aiming to give economic heft to the bilateral strategic partnership,” Invest India MD & CEO Deepak Bagla who was part of India-Russian Joint CEO Forum told ET. Invest India coinciding with the Annual Summit and SPIEF has concluded two pacts with R o s Congress (Russia’s business promotion agency) and Business Council for Cooperation with India (BCCI) to promote businesses and investments in each other’s country.

Areas that have been prioritised for Russian investments in India and JVs include agriculture, medical equipment, pharmaceuticals, start-ups, capital goods (metallurgy), food processing and civil aviation, according to Bagla.

These are part of slew of sectors earmarked for cooperation under the St Petersburg vision statement unveiled following Modi-Putin annual Summit. Other nondefence areas that India is seeking Russian expertise include energy corridor deep-ocean technology to harness rare earth metals, ship building, inland waterways, IT sector and harnessing natural resources in the Artic region where Russia has ownership of 15 out of total 19 ports.

In an yet another key development Russia Direct Investment Fund (RDIF) or RDIF – Russia’s sovereign wealth fund has now agreed to fund Russian investments in India and vice-versa, informed Bagla. RDIF is negotiating the creation of a joint fund with the Indian side worth $ one bln for financing projects. Last October at the Goa Indo-Russian annual Summit RDIF signed a document with India for creating joint fund.

ET View: Make Doing Business Easy
A cell to promote Russian investments is fine, given that the PM invited Russian CEOs to invest in sectors such as aerospace and infrastructure. More fundamentally, many of the factors that are taken for granted in advanced industrial countries should also exist in India: urban spaces into which industry can move in, stable power supply, and a culture of trust. We also need comprehensive judicial reforms to improve in enforcement of contracts. Investments will get a boost, automatically.