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Last Updated: Friday, 26 January 2007, 05:43 GMT
Russia and India's complex friendship
By Damian Grammaticas
BBC News, Delhi

There is a joke in Delhi that the word PUTIN is short for Planes, Uranium, Tanks, Infrastructure and Nuclear power.

It just about sums up the enormous goodie bag Russia's president is offering India.

President Putin is greeted by India's PM
President Putin has a lot to talk about with Indian PM Manmohan Singh

Moscow has long been India's main provider of weapons.

But there is far more at work now than a simple sales pitch for more contracts. The dynamic between these two nations is changing.

India and Russia had a long friendship throughout the Cold War.

When the Soviet Union collapsed both sides became more preoccupied with internal economic issues, Russia with its chaotic decline, India with pursuing reforms to stimulate much needed growth by releasing some of the shackles that had bound its own economy.

Now both nations have emerged from those transformations stronger and more confident than they have been for years.

They share a sense that they are rising on the tide of history.

Both have dynamic, fast-growing economies and they have needs that should be compatible.

So they are coming together to lay the groundwork for their future ties.

At present trade between the two is a paltry $2bn a year. They want to increase it many times over to build a broad economic and investment relationship.

'Power politics'

First and foremost for India is the urgent need to secure energy supplies.

India has relatively few energy sources of its own. Already it cannot keep up with demand from its power-hungry economy.

In 15 years' time it will consume three times much oil as it uses today. If it does not get new energy supplies India's remarkable economic rise could come to a spluttering halt.

Moscow is already building two nuclear reactors at Kundankulam in Tamil Nadu.

It is now offering India four more for civilian use.

To build them India needs special approval from the 45-nation Nuclear Suppliers Group (NSG) because it has not signed the Nuclear Non-Proliferation Treaty.

President Putin has promised to push India's case at the NSG. The reward for Russia in sales of reactors and uranium could be rich indeed.

India has also been trying hard to get more access to Russia's huge deposits of oil and gas.

It is already a partner in the Sakhalin 1 oilfield in Russia's Pacific waters.

But Moscow has seemed to favour China in its recent deals. Now Mr Putin may offer India a chance to invest in the Sakhalin 3 oil and gas exploration blocks and maybe other fields too. That would be a big prize for Delhi.

'Arms and the man from Moscow'

The quid pro quo may be major arms deals. India is looking to spend around $10bn in the next five years.

It wants to buy 120 new fighter jets in one of the biggest orders of its kind in recent years.

The Indian and Russian defence ministers
India's defence minister AK Anthony is set for talks with Russia's Sergei Ivanov

Russia is pitching its MiG-35. But Delhi is also considering diversifying its suppliers, which would mark a significant change of direction.

Sweden's JAS-39 Gripen, France Rafale fighter, and the American F/A18 Super Hornet or F-16 planes are all contenders for the contract.

So part of President Putin's agenda is to defend Russia's position as India's main arms supplier from growing competition.

To do that he is offering more than just weapons sales. Russia is willing to transfer technology too, and bring India in as a partner in new projects.

The Russian Defence Minister Sergei Ivanov has already said India may be allowed to build and maintain the engines for the Mig-35 itself if it signs up for Russia's plane.

India may also participate in the production of a new stealth fighter being planned by Russia.

The two sides are discussing developing a new military helicopter together.

They already work together to make the Brahmos missile system and ahead of President Putin's arrival they signed a deal giving India the blueprints to make engines for its existing MiG-29 fighters, and a memorandum on the joint development of a new military transport aircraft.

Before leaving Moscow President Putin was keen to point out "the very specific feature of our interaction has to do with the fact that we have moved from the simple paradigm of seller-buyer relationship to jointly work on products".

Russia is trying to tie in India's lucrative arms and energy contracts.

'India's new friends'

Moscow has reason to act. India has just begun building a new strategic partnership with the United States.

The spur for this was President Bush's landmark deal offering co-operation in civilian nuclear energy programmes. Washington wants to make common cause with India as the world's biggest democracy and a counterweight to rising China. It wants to sell its own nuclear reactors to India and weapons too.

So India's rise means it is being courted on both sides.

Delhi's ultimate aim is probably to secure what it calls "strategic balance" to avoid becoming too closely tied to either Moscow or Washington.

That will mean some hard-nosed bargaining. But it is India that is buying, whether it is energy or arms, and so it finds itself in an unaccustomed but increasingly powerful role as a major economic player, with both Moscow and Washington vying for its business.

Putin set for arms, energy talks
25 Jan 07 |  South Asia

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