MOSCOW: Russian President, Pranab Mukherjee, told Russia’s 15,000-strong Indian community to contribute to enhancing bilateral ties, pointing out that despite friendly relations and the “closest institutional ties,” Russia accounts for only 1 per cent of India’s total international trade, at $6 billion last year (down from $10 billion in 2013 and $11 billion in 2012).
He also urged the Indian community members, who attended a reception hosted in Moscow, to promote India as a destination for Foreign Direct Investment.
Officials say that since April 2000, of the $246 billion that has flowed into India, Russia has invested less than $ 1 billion.
Speaking to The Hindu at the event, however, Indian businessmen in Russia pointed out several problems with the trade relationship, adding that India is not seen as an easy destination for Russian FDI at a time the Russian economy is in straitened circumstances. The past year of sanctions against Russia, and the sharp fall in oil prices have both added to the problems within the country, including a significant devaluing of the Russian rouble. As a result, both businessmen and tourist arrivals to India have dropped 40 per cent in the past year.Businessmen here point out that Russia may be a good investment destination for India rather than the other way around. “This is the perfect time for example, for Indian hotel chains to set up in cities here, especially Moscow,” says Hiren Prabahakar, General Manager of the St. Regis hotel in Moscow, adding that the Starwood Hotel Chain is planning dozens of new hotels.
According to Sanjeev Shukla, a senior executive with the Four Seasons Hotel, who also attended the event, Indians face little discrimination in Russia compared to in other European countries. The biggest problems however are work-visa restrictions put in place by the Russian government in 2010 that stipulate that immigrants working in Russia can only belong to “high-skilled” categories, and must pass Russian fluency tests within six months. Many hope that the issue will be taken up by Prime Minister Narendra Modi when he travels to Russia in July and again in November this year. “Given the special ties and goodwill between the two countries, India should press Russia to make exceptions for India on visas,” says Mr. Shukla.
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