USSR Post
For friendship between India and Russia
Year 1976, USSR

India and Russia enjoy healthy strategic relations since Soviet era. Large part of Soviet help came in the sector of defence, education, mills, mining, and industry and infrastructure development. The two countries essentially shared the buyer-seller, give and take relation. However, after the collapse of Soviet Union and the liberalization of Indian economy the buyer-seller relationship turned into a full fledged partnership.

World's fastest cruise missile, Brahmos and fifth generation fighter aircraft PAK-FA/HAL FGFA is the result of close partnership between the two countries in defence sector. The two countries realized the potential of their economies, one of the fastest in the world, and pioneered furthermore collaborations and investments. One of the prominent example of the successful business collaboration is Sakhalin I project where India owns 20% stake in the oil field which has 2,300 million barrels of oil and 17,100 billion cubic feet of gas in place.

India has been seeking more such investment in Russia in the field of hydrocarbon, oil, and pharmacy. On the other hand Russia had not done any major commercial entry in the Indian markets, the only prominent investment by a Russian company in recent years is of Russian telecom company MTS. India is world's fastest growing telecom market and already has world's second largest mobile phone user base and third largest internet user base, making it one of the best region for any telecom company. Telecom industry is highly competitive in India, companies go to any extent (within the limits set by TRAI) to provide one of the best services to their customers including free SMS, freephone numbers, first few minutes of calls as free, etc. After the introduction of the brand in India, MTS had soon reached 16 million subscriber base in no time. However, the whole thing all of a sudden changed in India and most of the licenses provided to the private companies were cancelled giving a big blow to the Russian investment and economists. The developments were unwelcomed in Russia and expressing grief.

The recent changes in Indian system has affected Indo-Russian ties, defence sector in India which had seen a strong presence of Russian hardware and technology is also seeking partnership and contracts with other major providers in the world. Cancelling of telecom licenses in India was not directed against Russia, but was due to political corruption that had taken place during the auctioning of the licenses that led to the abrogation of all the licenses given. Another major investment that faced the stumbling block was Norway based company Uninor.

"We were very happy that such a new and interesting field of our mutual cooperation as telecom was opened, a new investment destination for the Russian capital – both private capital from the Sistema, as well as from the Government with its shares." Said ambassador of Russia to India, Alexander M. Kadakin in an interview to CNBC TV 18 Channel.

"As a bona fide buyer of that license we were thunderstruck when the whole thing all of a sudden changed here in India and all those licenses were pronounced invalid. It was a very unexpected development. I feel, the judicial and other authorities did not make a distinction between our company, which was a bona fide buyer, and all other companies. And the spectrum we bought was not claimed by any Indian company."

According to the Russian ambassador there seem to be the involvement of political element rather than judicial one in the whole case.

"I don’t want to comment on the Indian judicial system, with highest respect I have for it. But it seems there is more political content here than judicial one. If we take up the matter judicially, look - a bona fide buyer acquires a frequency which nobody claims, acting according to all norms and regulations, valid at that time, in 2008, and all of a sudden in 2011 they just cancel all the licenses and my company is boiled in one soup with all other companies which may have committed something. It is not a judicial matter only, it is a political one. The Russian Government will never allow 3.1 bln dollars to be thrown in the abyss. This must be understood. The Government’s shares are the tax-payers' money. It is about 1 bln. Are we to throw our money into the inferno of your internal problems in the telecom sector?"

When asked if India's popularity as an ideal destination for investment is declining, Kadakin reply was positive, he denied any such doubts and pointed to the "ill wishers" of the growing cooperation between India and Russia for creating such illusions.

"How can it be that India would seem not a very favourable destination for Russian investment if yesterday a deal was signed in Moscow opening a credit line for 3.5 bln US dollars for the development of Kudankulam power plant? This is a huge, very important and strategic project. How can one say that things are not OK? These are the intentions of 'ill-wishers' who try to sow evil seeds of doubt into our cooperation."

Further explaining the term 'ill wishers" he referred to the protests that were launched against the nuclear power plant in Kudankulam, India which are suspected to be motivated.

"When that situation continued for half a year, when India as a result was losing one million dollars every day. One should naturally think, how come those people were so well organized, on what money those “nature-protectors” were buying water and had food delivered, had shamianas erected there? It costs a lot. Who was giving the money? And the Indian Government has found that the money was channeled through all kind of ecological and “green” NGOs. But the money initially was targeted not for the anti-Kudankulam protests. Instead of developing the infrastructure in the region and in those villages, the money was used to organize protests!"

India and Russia has been great partners and there is hope of rising cooperation between the two as they participate constructively on international forums like BRICS and SCO. However, with the shift in India's vision towards the events in the world, its policies have become more pro western, on various recent international platforms and voting, India had taken sides with the western nations instead of taking with Russia and China. Referring to India's growing ties with United States, Russian media had said even to the extent that India is sliding to US pole and it is the time for Russia to being cooperation with Pakistan to maintain a healthy presence in the region.

However, according to Kadakin, all the claims are false and Russia seeks stronger partnership with India.

"As regards India, we are rejoicing together with India at its achievements. The figures of the India’s growth have been high, nearly 9 per cent, which in essence is almost an economic miracle. We are proud together with you, as Russia is India’s equal partner, a sister. So whenever I get to Moscow, I give one simple example: in five and a half years of my absence between the 'two Indias', when I was leaving my first ambassadorial post in 2004, the metro was inaugurated in Delhi and I took a joy ride. There were only seven stations there including Kashmiri Gate. But when I came back from Stockholm, you had more than 100 stations. Is that not a miracle? Moscow would be envious. We have one new station built in one year, and there is so much celebration. India is rushing ahead like a Russian troika. We are happy to be in that sledge together with India and want to rush even faster, and unite our efforts in all fields including that of mutual investment."

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