India–Russia trade heavily skewed despite surge, rebalancing needed, says Piyush Goyal

Commerce Minister Piyush Goyal

Commerce Minister Piyush Goyal on December 4 acknowledged that bilateral commerce between India and Russia remains heavily skewed and called for greater balance and diversification in the trade basket.

Goyal highlighted vast untapped opportunities for Indian exporters in sectors such as automobiles, electronics, heavy machinery, textiles and food products, as both sides work to reduce trade barriers and expand business opportunities.

“I am sure we will address the trade imbalance in the near future and work collectively to eliminate, reduce and dilute trade barriers if any, work to create the right conditions to open more opportunities for businesses in both countries,” Goyal said at an event in New Delhi.

In bilateral trade, India and Russia had set a target of $30 billion by 2025 a decade ago, a figure that has already been surpassed at nearly twice that level, he added.

Merchandise trade between the two nations was worth $68.7 billion in FY25, but Indian exports to Russia remained under $5 billion while imports were close to $64 billion.

An increase in Russian oil purchases, with New Delhi having little to offer in exports, has widened the trade gap.

Engineering goods remain India’s top export to Russia at $1.3 billion in FY25, followed by electronic goods worth $862.5 million and drugs and pharmaceuticals at $577.2 million. Other major shipments include organic and inorganic chemicals, marine products, and ready-made garments.

Some of India’s top imports from Russia in FY25 include crude oil at nearly $57 billion, animal and vegetable fats and oils at $2.4 billion, fertilisers at $1.8 billion, and pearls, precious, and semi-precious stones at $433.93 million.

India has been attempting to diversify its exports, especially amid steep tariffs from the US, with many goods facing reciprocal duties of 50 percent. Against this backdrop, New Delhi is also exploring a free trade agreement with the Russia-led Eurasian Economic Union (EAEU).

India and the EAEU bloc, on August 20, signed the terms of reference (ToR) to launch negotiations for an FTA in Moscow. ToR provides a framework for talks.

The two nations also pledged to increase bilateral trade to over $100 billion by 2030 during Prime Minister Narendra Modi's Moscow visit in 2024.