New Delhi: As the US and European Union (EU) shut their doors on Russia by imposing sanctions for backing Ukrainian separatists, India is eyeing a window of opportunity. The commerce ministry has chalked out a strategy to boost India’s exports of around 24 items to Russia that the country usually buys from the EU and US.

While most of the sanctions against Russia are in banking, finance and high-end technology, the commerce ministry thinks Russia’s souring relationship with the West may give India the opportunity to grab a slice of the market in other items that have been traditionally supplied by Western countries.

Items identified by the commerce ministry includes machinery, vehicles, aircraft and spacecraft, optics, electrical machinery, pharmaceuticals, plastics and meat. The ministry has written letters to various sector-specific export promotion councils to focus on these items in order to boost their exports to Russia.

Russia has suspended imports of beef and cattle from Romania, a regulator said on Wednesday, Moscow’s latest trade ban following new Western sanctions against Russia over the Ukraine crisis, Reuters news agency reported.

Due to stricter animal health norms enforced by Russia, India was unable to export bovine meat—cow and buffalo meat—and egg products to that country. However, Russia told an India-Russia working group on trade and economic cooperation meeting in February that Indian entities have begun getting the nod for export of egg powder to the Russian Federation, Kazakhstan and Belarus, which have a customs union.

Russia also lifted a ban on the import of non-basmati rice and oilseeds from India in September last year.

Ajay Sahai, director general and chief executive of the Federation of Indian Export Organisations (Fieo), said the EU and US sanctions provide an opportunity for Indian exporters to make an entry into the Russian market and establish a larger presence. “Russia is a major political partner of India, but it does not get reflected in our trade statistics. India-Russia trade is not even 1% of India’s total trade."

India’s exports to Russia contracted 6.46% in 2013-14 to $2.15 billion, while its imports from the country shrank 7.85% to $3.9 billion during the same year.

Sahai said Fieo is organizing a “Made In India" show in Moscow from 24-26 September where 125 companies will showcase their products.

“Russia is fast changing despite its problems with the West. A sizeable population in that country has high purchasing power, and if Indian companies can offer quality products, they can make hefty margins," he added.

Kanwal Sibal, a former foreign secretary and ambassador to Russia, said that while the strategy is sensible, it was unrealistic to expect a significant portion of Russia’s trade with the EU and the US to deflect to India in the short run. “Russia has to take a decision whether the products we intend to sell to them can be adequate substitutes for what they are buying from the US and Europe. It includes certain high-end technologies which we cannot provide since we ourselves are in the market for those technologies."

However, Sibal said there is a huge potential for exporting Indian-made items such as pharmaceutical products to Russia. “The other area is information technology where we have not been able to make enough penetration in the Russian market even though we are competing in the most advanced and competitive markets," he added.

The Indian pharmaceutical industry faces non-tariff barriers in Russia. The lack of specified time periods for implementation of new variations, registration and confirmation in Russia leads to delays in supplies, starting production and launch of new products in the market.

Prime Minister Narendra Modi has described Russia as a “time-tested and reliable friend" and, during his meeting with Russian President Vladimir Putin on the sidelines of the Brics Summit at Fortaleza, Brazil, last month, reaffirmed that relations with Russia will continue to enjoy the priority that they have always had in India’s foreign policy. Modi also said he looks forward to working with Putin to deepen and broad-base the strategic partnership between India and Russia.

“The two leaders looked forward to their annual summit in Delhi in December as an opportunity to outline a bold vision and roadmap for their relationship in the years ahead," a statement from the Prime Minister’s office said last month.

India and Russia agreed in February to a proposal for setting up a joint study group for studying the scope of their Comprehensive Economic Cooperation Agreement with member-countries of the customs union.

India is also trying to persuade Iran to build a 165km rail link between Rasht in Iran and Astara in Azerbaijan, a connection that is expected to give India market access to the landlocked Commonwealth of Independent States and Russia.

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