Moscow

India going ahead with S-400 missiles from Russia

(This has also been published in NewsBred).

India doesn’t intend to scuttle its plans to buy S-400 Triumf from Russia despite the spectre of US sanctions.

The visit of India’s defence minister Nirmala Sitharaman to Moscow last month was a firm indication of India’s resolve to ignore CAATSA (Countering America’s Adversaries Through Sanctions Act) which Donald Trump’s regime had invoked last year on Russia for its alleged interference in 2016 US elections.

India has always relied on Russia for its military hardware and technology which remains undiminished despite Modi government’s increased military reliance on United States. Presently, it imports 62 per cent of its military needs from Moscow.

US is adviced to go easy on India in case the deal materialized for one, it’s a bulwark against China in the Pacific Ocean; (2) It’s world’s largest arms importer benefiting US directly; (3) It could push India into the arms of China and Russia and thus completely neutralizing influence of US in Asia.

New Delhi had expressed its caginess against US sanctions during a visit of foreign secretary Vijay Gokhale to US recently.

The S-400 anti-air missiles have been billed as US F-35 killers by Moscow. During the cruise missile strikes by US, French and British army on suspected Syrian chemical weapon sites recently, it was noticeable they avoided areas protected by S-400 systems.

Russia has already begun delivering S-400 missiles to China; Turkey has a $2.5 billion deal to purchase S-400s from Russia. Iraq has expressed its interest too rather than US Patriot surface-to-air missile defence system which was dubbed a failure to protect Saudi Arabian capital Riyadh against the missiles launched by Houthi rebels in Yemen.

S-400 is one of world’s best interceptor-based missile defense system. It has an estimated operational range of 400 kilometres and an altitude of up to 185 kilometres. It could intercept missile warheads in their terminal stage.

India is expected to announce the purchasing of S-400 missiles from Russia when the leaders of the two country, Narendra Modi and Vladimir Putin, hold a bilateral summit in October this year.

India & Russia seek trade in gold

Sberbank, Russia’s largest state-owned bank, is looking to finance the direct import of gold to India.

Aleksei Kechko, managing director of the bank’s Indian subsidiary, has made an announcement to this effect which is no surprise to those who have followed the gold-buying spree of BRICS nations, especially China and Russia.

India imports a lot of gold. Indeed, it’s the second largest importer of gold in the world. India imported $35 billion worth of gold in 2015. The direct gold trade between India and Russia would help both nations.

“We hope to sign the transaction by September or October this year,” said Kechko “We are also exploring the possibility of entering the gold loans sector as well.”

Russia has been keen of late to conduct business with BRICS nations in gold. Russia now has a yuan-clearing bank in Moscow and it’s Central Bank has opened a branch in Beijing to make for better communication between the financial authorities of the two countries.

The effort by BRICS nations is to work towards bypassing the dollar while also using gold for transaction commodity between member nations.

BRICS nations actively are moving towards creating a new financial architecture to tackle the dominance of the US dollar in global finance.

The initiative was taken in the eighth summit of BRICS in India last year. The new institutions set up by the BRICS include the New Development Bank (NDB), the BRICS-led Contingency Reserve Fund (CBF) and the Asian Infrastructure Investment Bank (AIIB).

Russia is world’s third largest gold producer behind China and Australia, as per the 2016 data. Still, it has been on a massive gold-buying spree in recent years. Hit by economic sanctions by West, Russia’s ruble is the most gold-backed currency in the world. Moscow sees it as a safeguard against western attempts to destabilize Russia’s economy.

The same is the case with China who wants to be ready for economic warfare by the West. Both China and Russia have added almost 50 million ounces of gold to their central banks while selling off more than $267 billion of treasuries.

As for India, it simply loves gold leading to its constant demand. Be it newly-wed brides or trinklets with peasants in countryside, Indians simply love gold.

However, importing gold is relatively a new phenomenon. Until 1990, gold imports were virtually banned. Bullion was smuggled and cost 50 per cent more at home than abroad. However, deregulation set off an explosion. Now most gold legally comes to India through banks.

 

 

Russia need be a India-China mediator

The Russia-India-China (RIC) meet of its foreign ministers in Moscow is unlikely to have thawed the freezing relations between two Asian giants, China and India.

 

The same is true of the simultaneous visit of India’s defence minister Manohar Parrikar to China where he met his Chinese counterpart Gen. Chang Wanguan and stated India attaches highest priority to its relationship with China.

 

Both China and India suffer from a trust deficit though the niggling issue is simple enough: Both China and India need to look at each other’s territorial claims on Arunachal Pradesh and Aksai Chin plateau in a spirit of cooperation and resolve the long-standing dispute.

 

As a nation which stands to gain the most through India-China alliance, Russia could offer its own example: the Russian-Chinese borders were formalized in 2004 after 40 years of bad blood between the two nations.

 

The last fortnight has been particularly frosty: China blocked India’s move in United Nations to have Jaish-e-Mohammad (JeM) chief and allegedly Pathankot terror attack mastermind, Masood Azhar be designated as terrorist,

 

India, on their part, went ahead a signed an agreement with the United States on sharing military logistics in Indian Ocean, the area which is strategically and economically lifeline to Beijing.

 

But the RIC meet is unlikely to have much influence. Despite it being a foreign ministers’ conclave, it largely deals with the economic, and not security, issues.

 

The economic prospects of trade between India and China are mammoth. It’s already worth $100 billion and given their market and areas of strength, it holds immense possibility.

 

India could offer its Information Services strength and avail China’s expertise to build high-speed rail network in India. China’s excess production could also be easily absorbed within India.

 

India is extremely touch on matters of terrorism and finds itself regularly frustrated by China on international forums. Last year, China had blocked India’s bid to question Pakistan over the release of Zaki-ur-Rehman Lakhvi, a commander in Lashkar-e-Taiba, which had carried out the deadly 2008 Mumbai attacks that claimed 160 lives.

 

A leaked cable of US State Department in 2010 had revealed that China had in the past blocked UN sanctions against Lashkar-e-Taiba and the al-Akhtar Trust (a charity front for Jaish-e-Mohammad). It had also blocked India’s request to list Syed Salahuddin, a terrorist wanted in relation to numerous Hizbul Mujahideen attacks.

 

Though China’s moves were procedural within the UN sanctions committee, it was in opposition to the stands of US, UK, France and Russia all of whom were willing to back India on the issue.

 

China has a history of shielding Pakistan-based terror groups from sanctions under resolution 1267 even though it hardly ever uses a veto—exercising it only 10 times in its 70-year history of UNSC. It parrots the same line in defence that Pakistan does: “Pakistan is a terrible victim of terrorism itself.”

Such acts hardly endear China to India. It also reveals the closeness between Pakistan and China in modern context. India feels hemmed in between its two nuclear-armed northern neighbours. All it is doing is to drive India into US’ arms which dread the prospects of close India-China relations.

It still is encouraging that RIC has shown its concern on terrorism and a willingness to use international forums, such as BRICS, SCO, East Asian summits and Conference on Interaction and Confidence-Building Measures in Asia (CICA) to get the three nations closer.

Russia is keen to play a mediator’s role between China and India. It won’t be Asia’s century unless India and China draw closer to each other. Joint enterprises, preferential trade system and a common trade currency offer a huge opportunity.

China’s Great Silk Road project involves a huge territory—from Southeast Asia to the Caucasus. Russia, like India, isn’t yet a part of it even though a cooperation between the Silk Road and Russia-inspired Eurasian Eonomic Union exists.

There is a need to cool down the tempers from both sides. Says NewsBred columnist Shen Dingli: “China actually has many ways to hurt India. China could send an aircraft carrier to the Gwadar port in Pakistan. China had turned down the Pakistan offer to have military stationed in the country. If India forces China to do that,” there could be a threatening navy at India’s doorstep.