What is the issue?

  • The 23rd St. Petersburg International Economic Forum (SPIEF) was recently held in St. Petersburg, Russia.


  • The first SPIEF was held in 1997. Now over past two decades, it has become one of leading global platforms for communication between business representatives and discussion of crucial global economic issues.
  • Since 2006 it has been held under auspices and participation for Russian President Vladimir Putin.
  • The SPIEF 2018 edition brought together around 17,000 participants from more than 140 countries.
  • At the event Russia tries to boost its appeal to international businesses and investors.
  • Petersburg International Economic Forum 2019: brought together high-profile politicians, leaders from participating countries, leaders of International organisation, representatives of major international companies and organisations as well as experts from various fields.

Russia’s relation with the U.S.

  • Petersburg International Economic Forum is Russia’s annual investment gathering.
  • The meet took place in the backdrop of heightened tensions between the U.S. and Russia and China.
  • Unsurprisingly, it was boycotted by the U.S. Ambassador to Russia, Jon Huntsman.
  • His absence was ascribed to the prevailing environment in Russia for foreign entrepreneurs.
  • This is particularly in regards with the detention of U.S. private equity investor Michael Calvey on allegations of fraud.
  • Conversely, the Chinese telecommunications equipment manufacturer Huawei signed an agreement with Russia’s principal mobile operator to start 5G networks.
  • This came after Washington blacklisted Huawei, prohibiting it from selling technology to the U.S.
  • The U.S. also barred domestic firms from supplying semiconductors to Beijing.


Geopolitical irritants developed

  • The rift between the West and Russia began with Moscow’s annexation of Crimea in 2014 and the stand-off in eastern Ukraine that continues.
  • Russia’s tensions with the U.S. and some EU countries are also due to their opposition to the 1,200-km-long Nord Stream 2 gas pipeline from Russia to Germany.
  • S. plans to export liquefied natural gas to Europe, which is partly the reason why it objects Russia’s initiative.
  • Thwarting Russia’s ambition to dominate the region’s energy market is also one of U.S.’s objectives.
  • Another more sensitive issue is U.S. Special Counsel Robert Mueller’s inquiry into possible Russian meddling in the 2016 U.S. presidential election.

Relevance of the current engagement

  • Amid mounting tensions with the United States, long China’s top single trading partner, Beijing is now especially keen to emphasize the economic side of its relationship with Russia.
  • There are some early signs that relationship is benefitting as China moves away from importing U.S. energy and agricultural products.
  • As the Middle East heats up with Iran-USA issues, the energy security of the China hangs on the Russian support.
  • A clear focus on geopolitics in China-Russia relation.
  • Moscow and Beijing, hostile rivals of the Cold War era, have for a while been adopting common positions at the UN Security Council on critical international issues.
  • Chinese cooperation would moreover prove critical for Russia’s elaborate plans to exploit the Northern Sea Route along the Arctic as an alternative transportation hub.
  • Equally, President Donald Trump’s “America first” policy is compelling potential rivals to make common cause.
  • Russia proposed massive investments in infrastructure, including upgrading the trans-Siberian railway to better link his country to the Pacific.

Russia-China relations in new ways

  • Russian President Putin and his Chinese counterpart Xi Jinping made it clear that the tensions with the West had only drawn them closer.
  • Amid the tensions, both leaders emphasised that bilateral relations were at a historic high, marked by increased diplomatic and strategic cooperation.
  • Notably, China participated in Russian military exercises on its eastern border recently, marking a watershed.
  • Also, Moscow and Beijing, hostile rivals of the Cold War era, have for a while been adopting common positions at the UN Security Council on critical international issues.
  • Bilateral relations are also guided by pragmatism.
  • Russia appears realistic about the growing Chinese economic influence in Central Asia.
  • This is primarily driven by China’s massive infrastructure investments under the Belt and Road Initiative.
  • For Russia, Chinese cooperation would also prove critical for its plans to exploit the Northern Sea Route along the Arctic as an alternative transportation hub.
  • Besides, international sanctions have not been very effective in isolating Russia.
  • European states, notably Germany, recognise the importance of engaging with Russia to contain Mr. Putin’s expansionist aims.
  • Equally, President Donald Trump’s “America first” policy is compelling potential rivals to make common cause.

Role of India in this pivot

  • The Russia-China-India currently has engagements at SCO and BRICS.
  • International politics is changing so fast that it requires a degree of human ingenuity to grapple with geopolitical dynamics on a continuous and concurrent basis, and regional and sub-regional groupings are required to re-position and address themselves to emerging realities thoughtfully and imaginatively.
  • The India-China-Russia trilateral is still at a nascent stage.
  • China and India had reservations at being identified with the grouping, as their relationship with the USA was quite comfortable.
  • The convergence of economic interests and the imperative of mutual cooperation, however, provided the glue to put up the nomenclature in a proper perspective.
  • India, Russia and China, as countries with growing international influence, can make substantive contributions to global peace, security and stability.
  • The three countries uphold the concept of a multi-polar world and frequently take similar stands at multilateral bodies, they could utilise the synergy to promote their domestic economic development.
  • China has been articulating the view that the three countries could join hands in several fields, including trade, energy, and science and technology to broaden strategic ties with each other.

Way forward

  • In the increasing volatile global energy market, the St Petersburg economic format is an opportunity for India to leverage its best interest.
  • Widen scope of their economic partnership in the sectors of energy, Arctic region, transfer of technology, joint projects under Make in India initiative and manpower.
  • Russia is an age old friend of India; hence the vital relations with Russia for energy, geopolitical, economic and security fronts are important to be continued in a healthy form.
  • India can also benefit from SBEF, Russian transfer of technology including in railway sector. Defence ties was discussed in the context of Make in India initiative and the two leaders referred to AK-203 rifles factory in Amethi as Joint Venture.
  • Pharmaceuticals have been one of the traditional industries where India and Russia have developed strong ties. But India and Russia should change the model of cooperation.
  • Russia is interested in developing cooperation in the transportation sector, including Railways.
  • Currently, several Russia-based IT companies and venture funds are exploring investment opportunities in India.

# Practice Question

  1. In what ways the ongoing Russia – China relations affect the national interest of India? How shoul India respond to this situation? (250 words)
Share This