Yves here. While John Helmer describes how Putin and Modi are seeking to strengthen their alliance as a counter to US pressure, the bulk of his article documents in great detail how making that happen economically is no easy task. There is now a yawning trade deficit between Russia and India. From the Indian Embassy in Moscow<\/a>:<\/p>\n Bilateral Trade Figures<\/strong><\/p>\n The trade balance being skewed so heavily in favor of Russia is consistent with Russian unhappiness over accumulating so many rupees it can\u2019t readily use.<\/p>\n Helmer points out that Russia and India aspire to increase their bilateral trade to $100 billion US, but it\u2019s not obvious how that happens, because among other things India expects its imports of Russian oil to decline, supposedly not due to US sanctions but India wanting to be a bit more diversified in its energy sources. Mind you, with the EU insisting it will complete its Russia energy divorce, there would if anything seem to be even greater opportunities for India to refine Russian oil and export it to the EU.<\/p>\n The part of this picture I have trouble understanding is that normally a trade surplus country invests in the deficit country. Foreign direct investment is the most stable way to get that capital in. Many countries are not keen about that, due to being leery of the potential for foreign control and undue political influence. But Helmer reports that Indians are keen to have more Russian investment in domestic manufacture in India. But Russian companies have shown no interest.<\/p>\n By John Helmer, the longest continuously serving foreign correspondent in Russia, and the only western journalist to direct his own bureau independent of single national or commercial ties. Helmer has also been a professor of political science, and an advisor to government heads in Greece, the United States, and Asia. He is the first and only member of a US presidential administration (Jimmy Carter) to establish himself in Russia. Originally published at <\/i>Dances with Bears<\/a><\/i><\/strong><\/p>\n It is rare for the ceremony of a state visit to generate such a combination of national pride and comedy at the expense of an enemy; that\u2019s to say, making a mockery of President Donald Trump.<\/p>\n This is what this Indian cartoon (lead images<\/em>) of the meetings in Delhi last week of President Vladimir Putin and Prime Minister Narendra Modi has expressed. The upshot is that the video<\/u><\/a>\u00a0is going viral in both India and Russia.<\/p>\n It\u2019s a parody of a still popular song from the 50-year old Hindi comedy Sholay<\/em>. Because Dharmendra, star of the original comedy<\/u><\/a>, \u00a0died two weeks ago \u2013 he was as beloved by Indian filmgoers as Yury Nikulin (d. 1997) was by the Russian audience<\/u><\/a>\u00a0\u00a0\u2013 there is special Indian emotion in the song\u2019s revival today. \u00a0\u00a0For Russians, the cartoon is also a reminder of the 50-year old Ugly American defeated with Russian help on the battlefields of Vietnam, and revived again by Trump, depicted here with a hand on his impotent hosepipe.<\/p>\n \u201cWe will keep our friendship\u201d, Modi and Putin sing together as they refill the tank of their motorbike from the Russian petrol bowser, ignoring the US one and spinning Trump around in fury as they accelerate away. \u201cWe will take on the world.\u201d That\u2019s the message for Trump and his officials whose verbal insults, tariffs and visa penalties for India<\/u><\/a>\u00a0\u00a0have transformed public opinion across India. \u201cWe will keep on dealing\u201d, they sing at Trump who has ordered India to stop buying Russian oil for their refineries or pay a 50% penalty on all trade<\/u><\/a>. \u201cWe will not break this friendship. Difficulties will come but we will not leave you.\u201d<\/p>\n In his official welcome speech, Modi told<\/u><\/a>\u00a0Putin: \u201cAfter the Ukraine crisis, we have been in touch\u2026You have also been making us aware of the developments as a true friend. This trust is a big strength, and we have discussed this issue many times\u2026whenever I have spoken to world leaders, I have always told them that India is not neutral, India is on the side of peace, we support all efforts towards peace. And we stand shoulder to shoulder in these peace efforts.\u201d<\/p>\n In a second speech, Modi linked the war Russia is fighting against the US and NATO in the Ukraine and the war India fought against Pakistan last May: \u201cIndia and Russia,\u201d the Prime Minister said, \u201chave always supported one another and worked shoulder to shoulder in the fight against terrorism. The terrorist attack in Pahalgam<\/u><\/a>\u00a0and the cowardly atrocity at Crocus City Hall<\/u><\/a>\u00a0\u00a0are connected by a common, hateful ideology. India firmly believes that terrorism constitutes a direct assault on universal human values. Our unity within the global community is the only effective way to combat this evil<\/u><\/a>.\u201d<\/p>\n Putin responded<\/u><\/a>\u00a0with discreet references to the sanctions war Trump is waging against both Russia and India: \u201cOur two countries have developed resilient interbank channels for lending and financial transactions. Russian economic actors have been making wider use of the rupees they generate from export contracts\u2026.There has been positive momentum in our energy partnership. Russia is a reliable supplier of energy resources and everything India needs for developing its energy sector. We are ready to continue ensuring uninterrupted fuel supplies for the Indian economy to support its rapid expansion.\u201d<\/p>\n Putin\u2019s first line is the new realism Modi accepts; the two of them have begun to work in the secrecy required to secure against Trump\u2019s sanctions and tariff war. \u00a0Putin\u2019s last line is more optimistic than the Indian side is prepared to be, also in secrecy.<\/p>\n Indian and Russian sources acknowledge the personal bonhomie between the two leaders and the \u00a0\u201cpositive momentum\u201d of the 70-point Joint Statement issued at the close of the meetings<\/u><\/a>. \u00a0Putin added there is \u201cclear potential\u201d to increase the export-import trade between the two countries to $100 billion. He conceded<\/u><\/a>, however, that the 12% growth of the trade turnover between 2023 and 2024 to \u201cbetween US$64 and US$65 billion\u201d has not grown this year and \u201cwill stand at a comparable level\u201d. \u00a0If the Indian government figure for last year was in fact $63.8 billion<\/u><\/a>,<\/p>\n then this year\u2019s total may prove to be less, taking into account the decline in crude oil volumes in the last quarter.<\/p>\n Indian officials and business analysts are frank<\/u><\/a>: \u201cHow much of this bonhomie will translate into trade figures, particularly in achieving the much-touted goal of reaching $ 100 billion in bilateral trade between these two trusted neighbours? While $100 billion trade by 2030 may be an ambitious target, what may really happen is a significant reduction in India\u2019s import of Russian oil after the recent US sanctions. This may actually lead to a big fall in bilateral trade in the near term. Subsequently India Russia trade will have to be rebuilt on a more sustainable footing outside of oil trade.\u201d<\/p>\n An Indian source in Moscow adds: \u201cAs Putin announced, the Russians are willing to do their utmost to sell oil \u2014 whatever it takes. This promises real short-term benefits. But this has no long-term benefits for us. Russians are proposing more sales of high-tech defence equipment and we are interested. This is because we trust Russians more than we trust the US and France. But Russians know our goal is to produce locally. Almost none of the top-thousand Russian private businesses have shown any interest in India since the so-called Eastern Pivot was announced from 2014 and they were not visible in Delhi.\u201d<\/p>\n Sberbank and VTB have announced<\/u><\/a>\u00a0their presence in India, and the Russian Central Bank is opening a representative office in Mumbai. \u00a0These are the necessary \u201cresilient interbank channels for lending and financial transactions\u201d, which Putin announced. For \u201cresilient\u201d, read protection from Trump. \u00a0However, a Delhi investment financier comments: \u201cWe consider these to be baby steps when they [Russians] should be taking giant leaps.\u201d<\/p>\n The underlying problem is that for Indian exports to grow in the Russian market, the Russian oligarchs and leading businesses need to invest in manufacturing in India, with the aim of then exporting to the Russian consumer market as well as to the rest of the world. \u00a0This has been the model for US foreign direct investment (FDI) in India so far.<\/p>\n However, at least half, possibly as much as three-quarters of current foreign direct investment in India is coming from Indian oligarchs and businesses operating through offshore low-tax havens like Mauritius, Singapore, UAE, Lichtenstein, \u00a0and Cyprus. Also, this FDI is coming from the Indian business diaspora in the US and UK. \u00a0In India they are as reluctant to compete against new Russian investors, as the Russian oligarchs and businesses are reluctant to run India risks for their assets \u2013 unless they have the protection of the state or of Indian partners.<\/p>\n Laugh, then listen to the discussion led by Dimitri Lascaris of the Russia-India-China strategic relationship which the Yankocentric podcasters are missing<\/u><\/a>.<\/p>\n The trade statistics for India and Russia reveal that, \u00a0if not for the surge of crude oil purchases by India triggered by price discounting on the Russian side to escape US and European sanctions, the volume of Indian imports from Russia and Russian imports from India would be relatively more balanced \u2013 but at a much lower turnover aggregate. As the charts of Indian imports reveal, China is the largest source with 18.5%; Russia comes next with 10.2%; the UAE, a re-export hub, trails at 8.5%.<\/p>\n By contrast, as a destination for Indian goods, Russian demand amounts to just 1.1% of India\u2019s export total. \u00a0The US leads with 18.3%; Indians acknowledge this is a vulnerability which Trump is exploiting with his tariff threats.<\/p>\n THE INDIA-RUSSIA TRADE IMBALANCE AND THE RUSSIAN CRUDE OIL FACTOR<\/strong><\/p>\n The data on Indian imports of Russian oil suggest that the surge was a short-term, price opportunity tactic by Indian refiners. It was not a strategic shift by the Modi government. In fact, according to the Indian assessments, the government in Delhi was attempting to reduce the volume of Russian oil imports and diversify the refiners\u2019 sourcing before (repeat before) Trump imposed his 25% additional tariff penalty.<\/p>\n \u201cThe Russian oil-related 25% additional tariff by the U.S. on Indian imports came into effect on August 27. However, India has cut the value of Russian oil imports in eight out of the previous 10 months up to September 2025, compared to the corresponding months of 2024. In five of these months \u2014 February, May, June, July, and September \u2014 the cuts were by more than 20% each. \u2018India has known for a while now that its dependence on Russian oil imports had grown too high and so it was already working on a plan to reduce this,\u2019 an official in the Ministry of Commerce and Industry told The Hindu<\/em>\u00a0on the condition of anonymity given the sensitivity of the issue. \u2018The Trump tariffs have come during that time,\u2019 the official said. \u2018Yes, they are a factor to be kept in mind, but they are not driving Indian policies<\/u><\/a>.\u2019\u201d This reduction of Russian oil imports is not just in absolute terms, but also in terms of the Russian share in India\u2019s total oil imports. This hare of India\u2019s oil imports grew from 1.6% in 2020-21, to 2% in 2021-22, before jumping in the first of the war years to 19% in 2022-23; 33.4% in 2023-24, and 35.1% in 2024-25. On a month-by-month basis, in September 2024 Russian crude peaked at about 41% of Indian imports, but by September of this year the share had dropped to 31%.<\/p>\n Thus, when Putin announced publicly \u201cwe are ready to continue ensuring uninterrupted fuel supplies for the Indian economy to support its rapid expansion,\u201d the evidence is that Modi is far from persuaded to buy, and Trump\u2019s interference is not the only reason.<\/p>\n Therefore, in order to reach the $100 billion trade turnover target the two leaders have now agreed to, with more balance and an increase in Indian exports to Russia, the requirements will focus, as the Joint Statement indicates, on Russian military industrial exports, Russian nuclear technology, joint ventures in fertilizer supplies, pharmaceuticals and their raw materials, and \u201ccritical minerals for emerging technologies<\/u><\/a>\u201d.<\/p>\n Indian and Russian experts are asking whether there is Russian consumer demand to match American consumer demand for the top-ten Indian exports. If there is not, as the experts answer for the time being, the solution must be increased Russian investment in India for return exports to the Russian market, as well as for India\u2019s global markets.<\/p>\n THE US-INDIA COMMODITY TRADE MODEL \u2013 CAN RUSSIA APPROACH OR REPLACE IT?<\/strong><\/p>\n A Moscow source in a position to know says<\/u><\/a>: \u201cPutin might be sincere but the oligarchs have no interest in India as a market, as a manufacturing partner. The Indians should expect nothing of consequence from them unless Modi has persuaded Putin that he must direct Russian capital into India. For the time being, there was little evidence of the seriousness of the Kremlin in this direction from either the membership of the Putin delegation or in the subsequent business forum organised by the Roscongress Foundation and the Federation of Indian Chambers of Commerce and Industry (FICCI).\u201d<\/p>\n Delhi sources differ<\/u><\/a>. \u201cInconsequential traders made up the bulk of the audience; there was no serious dialogue\u201d, commented one. Others disagree, \u00a0pointing to the presence of Russian bank leaders, Rosneft chief executive Igor Sechin, fertiliser industry representatives, as well as Oleg Deripaska\u2019s Rusal aluminium, alumina and bauxite group. \u00a0According to a Moscow source, \u201cthe<\/p>\n Russian oligarchs and big business are waiting to run back to the western havens once the war ends and there is sanctions relief\u201d \u2014 \u201cif there is sanctions relief,\u201d the source added the qualifier.<\/p>\n FOREIGN DIRECT INVESTMENT (FDI) IN INDIA BY COUNTRY SOURCE, VOLUME, YEAR \u2013 TOP-TEN TABLE SUMMARIES SHOW RUSSIA TRAILING<\/strong><\/p>\n In the 70-point Joint Statement concluding the Delhi talks, just four points focus on the military priority of the two sides, India to buy, Russia to sell. The negotiations under way for India to acquire the Su-57 aircraft for offence and the S-500 for air defence are not mentioned in the text<\/u><\/a>. \u00a0No decision has been reached for the time being; there is keen French<\/u><\/a>\u00a0\u00a0and American counter bidding<\/u><\/a>. \u00a0There is also an active Indian and Chinese debate over India\u2019s strategic intentions for the new weapons.<\/p>\n Ahead of Putin\u2019s arrival in Delhi, the Kremlin organised a special advance briefing for the Indian press by presidential spokesman Dmitry Peskov. Peskov was speaking by videolink from Moscow to reporters gathered in Delhi. \u00a0A key question of Russian strategy was asked by Raj Chengappa, Editorial Director of the India Today group. \u201cCan Moscow give any assurance, even privately, that in a crisis between China and India Russia would not tilt decisively towards Beijing?\u201d<\/p>\n Peskov answered<\/u><\/a>: \u201cIndia wants to listen to us. We want to explain ourselves. India hears us, and it\u2019s a mutual understanding. And it\u2019s also our privileged strategic partner. And we enjoy a very, very high level of cooperation with China in various fields, like with India. And yes, it\u2019s our readiness to enhance, to develop our cooperation with China in various fields with no limits. But the same stand we have with India. We are ready to go as far as India is ready. We respect bilateral relationship between India and China, and we have no doubt that the two oldest countries to [inaudible line cut] in order to keep global stability, global predictability, and global peace, and regional peace. Russia will continue to develop our friendship with India and with China. Thank you.\u201d<\/p>\n The Indian reaction has been sceptical of Peskov\u2019s responsiveness on the China question, and also on the support Russia undertakes to give India in its war against Pakistan-based and Pakistan-directed terrorist attacks in India<\/u><\/a>.<\/p>\n The Joint Statement<\/u><\/a>\u00a0was more explicit than Peskov: \u201cThe two Leaders reaffirmed their strong commitment to preventing and countering terrorism in all its forms and manifestations including cross-border movement of terrorists and terrorist financing networks and safe havens. They condemned in the strongest terms the terrorist attack in India in Pahalgam, Jammu and Kashmir, on April 22, 2025, and in Russia at the Crocus City Hall in Moscow on March 22, 2024. They unequivocally condemned all acts of terrorism as criminal and unjustifiable, regardless of their motivation by any religious or ideological pretexts, whenever, wherever, and by whomsoever they may be committed. They also called for concerted actions against all UN-listed terrorist groups and entities, including Al Qaeda, ISIS\/Daesh and their affiliates, aimed at rooting out terrorists\u2019 safe havens, countering the spread of terrorist ideology, eliminating terrorist financing channels and their nexus with transnational crime, and halting cross-border movement of terrorists, including foreign terrorist fighters.\u201d<\/p>\n The Chinese are also interpreting the expanding India-Russian military alliance with the expressed concern that it is aimed at them. If there is a new crisis along the still undefined border in the Himalayas, and new fighting at the Line of Actual Control<\/u><\/a>, which side, Chinese analysts have been asking, will Russia take \u2013 for India against China, or vice versa?<\/p>\n In this review of the Chinese suspicion and speculation, Lieutenant-General Ravi Shankar reviews the new publications from Beijing and assesses their credibility from the Indian point of view<\/u><\/a>.<\/p>\n Listen to the discussion with Dimitri Lascaris of the India-China border conflict, starting from Minute 31:50<\/u><\/a>.<\/p>\n\n
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<\/p>\nClick to view: https:\/\/www.youtube.com\/watch?v=o46QaPIOgOM<\/u><\/a>\u00a0<\/code><\/p>\n![\"\"](\"https:\/\/www.nakedcapitalism.com\/wp-content\/uploads\/2025\/12\/00-modi-3.webp\")
The obscured figure in the chart for the European Union\u2019s share of Indian exports is 17.8%. Click for larger view and analysis: \u00a0https:\/\/thewire.in\/trade\/the-economic-reality-of-india-russias-100-billion-ambition<\/u><\/a>\u00a0<\/code><\/p>\n![\"\"](\"https:\/\/www.nakedcapitalism.com\/wp-content\/uploads\/2025\/12\/00-modi-4.webp\")
Source: https:\/\/www.thehindu.com\/business\/Economy\/indias-shift-away-from-russian-oil-imports-predates-trump-tariffs\/article70298792.ece<\/u><\/a>\u00a0<\/code><\/p>\n![\"\"](\"https:\/\/www.nakedcapitalism.com\/wp-content\/uploads\/2025\/12\/00-modi-5.webp\")
<\/p>\nSource: Indian Ministry of Commerce & Industry -- note: Data for 2025-26 is for the April-September 2025 period<\/a> \u00a0<\/code><\/p>\n![\"\"](\"https:\/\/www.nakedcapitalism.com\/wp-content\/uploads\/2025\/12\/00-modi-6.webp\")
<\/figure>\nSource: https:\/\/www.india-briefing.com\/news\/india-us-trade-data-state-wise-2025-40790.html\/<\/u><\/a>\u00a0<\/code><\/p>\n![\"\"](\"https:\/\/www.nakedcapitalism.com\/wp-content\/uploads\/2025\/12\/00-modi-7.webp\")
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<\/figure>\nSource: \u00a0https:\/\/www.dpiit.gov.in\/static\/uploads\/2025\/07\/03ad41d0e0c3deb434e0520f5dda6df3.pdf<\/u><\/a>\u00a0<\/code><\/p>\n![\"\"](\"https:\/\/www.nakedcapitalism.com\/wp-content\/uploads\/2025\/12\/00-modi-9.webp\")
<\/figure>\nSource: https:\/\/www.youtube.com\/watch?v=jfRdHV_wr5M<\/u><\/a>\u00a0\u2013 Min 22-24:43.<\/code><\/p>\n![\"\"](\"https:\/\/www.nakedcapitalism.com\/wp-content\/uploads\/2025\/12\/00-modi-10.webp\")
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