India and Russia are working to improve the system of mutual settlements in the face of Western sanctions while Russian banks have adapted to sanctions and Indian credit institutions have learned to minimise the risk of secondary sanctions, Russian ambassador Denis Alipov has said.
Mechanics for direct payment flows for trade have been built and both countries have largely switched to settlements in national and alternative currencies, whose share now exceeds 90%, Alipov said in an interview ahead of President Vladimir Putin’s visit next month for an annual summit.
In addition to pitching the construction and localising of small modular reactors to boost civil nuclear cooperation, Alipov said Russia is ready to expand the transfer of defence technology, including the licensed production of Su-57 fifth-generation combat jets. Edited excerpts:
Q. Ahead of a planned visit by Russian President Vladimir Putin, how do you assess India-Russia ties and what will be the focus for the upcoming bilateral annual summit?
A: Russia-India strategic partnership, which turned 25 last month, has become a stabilising factor in global affairs and an integral boost for economic development for our two countries. Our shared values have been earned over decades of sincere friendship as well as positive, equal and comprehensive cooperation, which is mutually accommodative, easily adjustable to new requirements and highly competitive.
The upcoming summit will encompass the entire gamut of our multifaceted cooperation, building on the progress in traditional areas of decades-old partnership such as nuclear power, defence, space, science and technology, education and people-to-people ties. Of particular importance are common efforts to underpin the upward trajectory of economic cooperation – since 2022, our trade volume has seen an increase of more than six times, making Russia the fourth largest Indian trade partner with $70 billion, and the strongest contributor to Indian energy security, ensuring more than one-third of Indian crude oil imports.
To reach a new, more ambitious landmark of $100 billion by 2030 and remain competitive, we think big and look beyond the horizon, aiming at raising the efficiency of independent payments and insurance mechanisms, developing alternative logistics corridors, including INSTC, Chennai-Vladivostok and the Northern Sea Route, expanding mutual market access by launching an FTA (free trade agreement) between Eurasian Economic Union and India, promoting labour migration and mutual investments.
At the same time, it is of utmost importance to harness the untapped potential of new and promising venues of common ground and mutual complementarity to meet up-to-date development needs of our countries. Among them are construction and localising of small modular reactors, blockchain, artificial intelligence, big data, energy transition, cooperation in the Arctic, promotion of tankers and ice-class ship- and civil aircraft building in line with “Make in India”, “Self-reliant India” and other initiatives.
Q. What in your assessment makes the India-Russia partnership different from other bilateral relationships at a time of unprecedented geopolitical churn on the global stage? It is also a legacy relationship and what is being done to make it future-oriented?
A: Since the establishment of diplomatic relations between Russia and India in 1947, the widely used definitions “time-tested” and “trusted” have proved to be not just slogans, but a reflection of reality and convergence of our national interests as well as implementation of the principles of equality and mutual respect. Our partnership, constantly going from strength to strength to become even more solid, coherent and robust, has remained intact to global headwinds and tectonic geopolitical shifts of the 20th and 21st centuries and successfully transcended from one era to another. This shared and treasured legacy is not nostalgic – the unshakable basics laid during these decades of decolonisation, industrialisation, 1971 events, extensive bilateral military and technical cooperation, our joint space exploration – matured into the special and privileged strategic partnership. In December, we will commemorate its 15th anniversary – for us, this status does not have an official attribution to any other country except for India.
What makes these relations future-oriented is that we never stop – neither in combining our capabilities and goodwill to serve the best interests of two nations in enhancing our economic, scientific, research, technological, industrial and defence potentials, nor in broadening the agenda towards establishment of just and equal multipolarity based on universally recognised principles of the UN Charter and the international law. Our close coordination at multilateral fora, including the G20, BRICS, the SCO and many others, makes this trend irreversible as a core precondition to create a favorable environment for our countries to grow and prosper.
Q. New US and Western sanctions threaten to impede India-Russia economic cooperation, especially in energy. How confident are you that systems and arrangements put in place by India and Russia can help overcome these sanctions? Will alternative arrangements for payments, shipping and insurance services remain effective?
A: We consider illegitimate unilateral sanctions as an instrument of political pressure and unfair economic competition. They hinder economic development, affect ordinary citizens, and lead to the destruction of supply chains. India has not officially joined the Western restrictions; however, many local companies, primarily focused on the European and North American markets, are very cautious to openly cooperate with Russian partners.
Along with development of alternative transport and logistics routes, our countries are constantly working to improve the system of mutual settlements to ensure the interests of economic operators. Russian banks have adapted to sanctions, including “freezing” of accounts in the US and the EU, “disconnecting” from the SWIFT system. Indian credit institutions have learned to minimise the risk of being subjected to “secondary” sanctions. The mechanics of direct payment flows for trading operations have been built. We have largely switched to settlements in national and alternative currencies, with its share exceeding 90%. As a result, mutual settlements between Russia and India have become more secure and diversified in terms of the use of currencies and transaction channels. Russia and India have moved to a qualitatively new level of banking interaction based on national payment systems.
Q. Many Western sanctions are linked to the conflict with Ukraine. Can India play a role in helping end hostilities between Russia and Ukraine?
A: Being one of the essential pillars of the emerging multipolar world, India’s voice is certainly important. Especially so because India is our long-time friend. Russia appreciates New Delhi’s principled and balanced position on the Ukraine conflict that is conducive to finding a peaceful solution.
India has not endorsed sanctions imposed by the West on Russia due to their illegitimate nature that undermines the authority of the UN Security Council. India itself suffered from the effects of such measures imposed by the West seeking to coerce India, especially after the nuclear tests in 1998. We witness the return of such a heavy-handed approach of the Western powers that seek to influence the outcome of the Ukraine conflict by hurting India economically. Current Russia-related sanctions are inimical to India’s interests and it would be only logical if New Delhi opposed them as illegal and detrimental to the well-being of the Indian people.
Sanctions do not help resolve crises, pressure does not work and only spreads resentment. More so, the West is using the Ukrainian conflict, its brainchild, not as a reason for unilateral restrictions, but as a pretext to pressure Russia and its legitimate partners. However, as Russian President Vladimir Putin recently said, no self-respecting country and no self-respecting people ever make decisions under pressure.
Qww. As India prepares to take over the presidency of BRICS in January, what role does Russia see the bloc playing on the global stage, especially when many in the Global South are looking for alternative arrangements for trade and economic cooperation?
A: First of all, let me express Russia’s full support to India as it prepares to assume its BRICS chairship in 2026 and commend Brazil for its excellent leadership of BRICS this year. India is a key actor in BRICS and we count on our partners to further promote and contribute to the grouping’s achievements and initiatives.
Over the years, BRICS has evolved into a full-fledged partnership of like-minded countries built on the principles of openness, solidarity, mutual assistance and sovereign equality. It champions genuine multilateralism, advocates improving global governance to better reflect the interests of the Global Majority and invests in shaping a more just and equal multipolar framework for international cooperation.
Through its cooperative efforts in trade, financial infrastructure, and climate action, BRICS is creating alternative pathways to development that are inclusive, equitable, and resilient. The grouping seeks to strengthen its role in the international monetary and financial system, promote currency diversification, including through a broader use of national currencies in bilateral trade, and enhance interbank cooperation. We hope to continue working on Russia-proposed initiatives and institutions that include the New Development Bank, Grain Exchange, BRICS Clear, Cross-Border Payments Initiative, Interbank Cooperation Mechanism and BRICS Investment Platform.
The success of BRICS in these areas will not only benefit its member states but contribute to a more stable and just global economic order – one that supports sustainable development for all nations. Amid the increasingly turbulent upheavals in global trade and finance BRICS, opposes protectionism and illegitimate unilateral coercive measures, including trade wars.
Qww. What are long-term plans for India-Russia trade and investment cooperation, including steps to make trade more balanced?
A: Despite impressive volumes and figures in trade and investment between Russia and India, our potential remains largely untapped. To achieve our ambitious goals, we need to reach a new level in economic ties through an expanded diversification and liberalisation, exploration of new areas and dedicated support for business engagements and inter-regional dialogue. The extension of inter-banking networks, mutual presence in capital markets and labour mobility may play well to promote dedicated interactions and raise awareness of new opportunities.
In many areas, we can move from a buyer-seller scheme to joint ventures, which has become a widespread practice in railways with the participation of a Russia-led consortium in the Vande Bharat project, petrochemicals, metallurgy, infrastructure and other segments. Remarkably, the visit of Russia’s Deputy Prime Minister Dmitry Patrushev, who led a delegation at the World Food India in New Delhi in September, laid the ground to make agriculture a new strategic area in our partnership through the extension of mutual supplies and joint ventures, including in the area of fertilisers. Shipments of fertilizers from Russia already ensure 25% of the market share in India.
A game changing move was the introduction of the mechanism of Authorized Economic Operator, designed to simplify customs procedures and make business transactions more transparent, predictable and secured to make the private sector feel more confident.
The problem of trade imbalance amounting to $60 bn in 2024 is officially recognised. To address it, we invite the Indian manufacturers to supply more to the growing Russian market and look for relevant opportunities at the dedicated events in the framework of the branded fora, such as the SPIEF, EEF, INNOPROM.
Q: What are the plans for taking forward civil nuclear cooperation, including plans for a new nuclear power plant and work on small and modular nuclear reactors?
A: The overall success of the Kudankulam nuclear power project in Tamil Nadu, with two of its six blocks already generating affordable energy for the local population, is a huge step involving increased localisation, capacity building and specialists’ training. Our dialogue in civil nuclear cooperation has become significantly diversified covering the topics of non-energy use of nuclear technologies, scientific research and prospects of joint projects for small reactors, which were one of the focus areas in the Indian budget 2025-26 in the context of the Indian Nuclear Energy Mission aimed at achieving 100 GW of nuclear energy by 2047. I believe that based on our positive practical experience, we will see more engagements in these and other areas, especially keeping in mind upgradation of national legislation, including expected amendments to the Civil Liability for Nuclear Damage Act, 2010, and the Nuclear Energy Act, 1962.
Q: With Russian weapon systems used extensively in India’s conflict with Pakistan in May, are there plans for supplying more defence hardware, such as a follow-on contract for S-400 systems? Can Russia’s defence industrial complex significantly integrate with the Make in India initiative, especially for joint development of more weapons such as the BrahMos missile?
A: Russia is proud of its time-tested strategic partnership with India in defence. Many generations of Indian warfighters have grown to trust Russian origin equipment that has become an important part of this country’s armoury. A privileged position of the “weapon of choice” of the Indian armed forces is a recognition of the effectiveness of Russian hardware.
We welcome India’s aspiration for self-reliance in defence manufacturing and have been contributing to it in several areas. Operation Sindoor witnessed many “firsts” for bilateral collaboration projects, including a remarkably successful battle test of the jointly developed BrahMos supersonic cruise missile and a game-changing performance of the S-400 air defence system. Locally manufactured Su-30MKI, a backbone of India’s fighter force, enabled the success of the operation. India is the first country to start producing AK-200 series assault rifles domestically, in Uttar Pradesh. For the Indian Navy, eight Talwar-class frigates have been delivered, and two more ships are currently under construction in Goa. Russia looks forward to opening a new page in this strategic relationship by expanding transfer of technology to India, including through licenced production of Su-57 fifth-generation fighter aircraft. This will speed up India’s own AMCA fifth-generation fighter programme.
Russia’s contribution to the Make in India initiative is not limited to defence equipment. We are preparing to write a new chapter with the recent signing of a MoU between India’s HAL (Hindustan Aeronautics Ltd)_ and Russia’s United Aircraft Corporation on licenced manufacturing of the Sukhoi SJ-100 regional passenger aircraft. Under the scheme, India will be able to produce these airplanes to satisfy its own growing requirements for domestic flight connectivity in addition to becoming a regional hub for maintenance, repair and overhaul of SJ-100s.
Q. The issue of Indian nationals serving in the Russian Army is one of the few areas of concern for New Delhi in the bilateral relationship. What is being done to tackle this?
A: This issue is of serious concern to both sides. The Russian Army does not recruit Indian nationals, those who signed military contracts have done so voluntarily. The government of India has on numerous occasions strongly advised Indians to stay away from employment opportunities offered by dubious recruitment agencies in India or other countries. We stay in permanent touch with the external affairs ministry on the issue, helping to respond to particular queries from families in coordination with the Russian defence ministry.
As for the known and confirmed cases of individual Indians serving in our army, they may be addressed to our ministry of defence through the embassy of India in Moscow. The mechanism has already been established.
