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Boost in Russia-India Trade: Projection for US$65 Billion Bilateral Trade in 2023

Trade between Russia and India has experienced a significant rise this year, surpassing the previous year's total turnover of goods in just the first eight months. According to data from the Indian Ministry of Commerce and Industry, total trade between the two countries reached an all-time high of US$43.8 billion from January to August. If this trend continues, bilateral trade volume is expected to reach US$65.7 billion by the end of the year.

Russia in TOP 5 trading partners for India

Russian exports to India saw a significant surge, reaching US$41.2 billion compared to US$17.1 billion during the same period last year. Importantly, Russian imports from India also increased by 50% to reach US$2.6 billion. As a result, Russia has become one of India's top five trading partners in terms of goods turnover.

India increases purchase of Russian oil and diamonds

Imports of Russian oil by India increased by 80% in September alone, averaging 1.56 million barrels per day (bpd). In addition to energy, India has also increased its purchases of Russian diamonds, with a 26% year-on-year increase, amounting to gems worth US$886.5 million during the reporting period.

In contrast, the European Union (EU) has recently banned the import of Russian diamonds, impacting major EU diamond processing and sales houses in Belgium. Therefore, the diamond trade is expected to relocate to Dubai and Bombay, as new wealth creation in Asia influences market trends, while Europe's declining wealth has the opposite effect.

India emerged as the world's largest diamond importing nation in 2022, accounting for nearly 22% of global diamond imports by value that year. Hong Kong, the UAE, China, and Thailand are also significant buyers of globally available diamonds, none of which have banned Russian diamond imports.

The speaker of the Upper House of the Russian Parliament, emphasised the unprecedented growth in mutual trade turnover between Russia and India, which has grown five-fold in the past year and a half. She noted that while the current trade volume is approximately US$50 billion, both countries have even greater potential for further development. The promising areas of cooperation are as follows: energy sector, agriculture, and IT, reiterating India's interest in strengthening trade ties with Russia.
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