The Hon’ble Minister of Commerce & Industry and Civil Aviation, Shri Suresh Prabhu has suggested that the Indian and Russian governments could consider a direct bilateral agreement to boost Indo-Russian trade in the diamond sector. He was addressing the the India – Russia Business Summit organized by DIPP, Invest India and Confederation of Indian Industry (CII) in New Delhi today.

According to media reports, the minister said that as India is the hub for cutting and polishing diamonds and Russia has huge diamond reserves, the government-to-government agreement could be worked out “in a manner that does not adversely impact balance of payment”. He added that “Russian exports will increase to India and we import it, process it and re-export it, and both get benefitted".

An ‘India-Russia Joint Statement during visit of President of Russia to India’ released today notes, “The Sides praised the level of cooperation achieved in diamond sector, including the signing of new long-term contracts for rough diamond supplies by PJSC ALROSA to Indian companies, opening of the ALROSA representative office in Mumbai and joint financing by the ALROSA and the Gem & Jewellery Export Promotion Council of India of the International Diamonds Producers Association on the development of programmes of generic marketing of diamonds, including in the Indian market. Both Sides noted recent investments by Indian companies in the diamond manufacturing in the Russian Far East.

“The Sides agreed to explore opportunities of joint collaboration in precious metals, minerals, natural resources and forest produce, including timber, through joint investments, production, processing and skilled labour.”

Media reports also state that, while speaking at Summit, Russian Economic Development Minister Maxim Oreshkin said his country was preparing a strategy to increase economic cooperation with India. He was quoted as suggesting that it could include investment protection and avoidance of a double taxation agreement with India, besides trade carried out in national currencies.

Shri Prabhu also announced that the Indian government would be setting up a fast track, single-window mechanism to resolve any issues related to Indo-Russian trade and this could be extended to cover diamond imports.

The mechanism, a single window system under the chairmanship of the Secretary of the Department of Industrial Policy and Promotion, will handhold Russian companies looking to do business, through trade and investment in India, it was reported.

DIPP Secretary Abhishek was quoted as saying that there was a huge opportunity for Russian companies to invest in India as the government had taken several reform measures. He said that foreign direct investment had increased to US$ 222 billion in the last four years as compared to US$ 152 billion in the previous four years.

The reports also quoted the secretary as saying that to promote trade, India wants Russia to explore opportunities in the diamond business and consider use of national currencies for trade purposes in various sectors.

Bilateral trade between the two countries increased to US$ 7.5 billion in 2016-17 from US$ 6.2 billion in the previous fiscal. In December 2014, the leaders of the two countries set a target of US$ 30 billion bilateral trade by 2025.