Russia Shrugs off US Sanctions, Vows to Grow Arms Trade with India

Russia has shrugged off United States' sanctions against its arms manufacturers and has vowed to increase its current US$4 billion order book with India by a further estimated US$11 billion.

Contracts under negotiation include the S-400 air defence system, an order for 48 Mi-17 helicopters and the joint production of KA-226T helicopters besides Project 11356 frigates, A.A. Mikheev, General Director of Russian Arms exporter, Rosoboronexport, told a select group of journalists in Moscow today.

Referring to sanctions imposed by the United States against Russian arms manufacturers and its impact on Indo-Russian arms trade, Mikheev, who was addressing the journalists together with D.A. Shugaev, Director, Federal Service for Military-Technical Cooperation (FSMTC) said, “sanctions pressure is being gradually built on us. Every day we wake up some new sanctions being imposed.”

He said a recent waiver given to India from secondary sanctions was conditional to shrinking its arms trade with Russia. However, given the scale of current and future projects, it is unlikely that Russian arms sales to India would ever shrink. On the contrary they were poised to grow even further owing to Russia participating in a number of procurement tenders of the Indian Ministry of Defence.

Responding to a journalist’s question, he admitted that US sanctions on Russia had affected the mode of payments for defence equipment by New Delhi to Moscow. Both countries were working on ways to neutralize the effect of sanctions and that resorting to Rupee-Ruble payments was one of the options being considered.

He said the contract to purchase the S-400 air defence system was expected to be signed before the end of the current year. He declined that Russia was putting pressure on India to sign the contract and that all negotiations had been concluded with only the contract signing awaited.

The S-400 would not only protect India from incoming missiles and aircraft but could be integrated with short-range air-defence systems such as the Buk-M4 and Tor to provide protection against lower-level threats such as UAVs and low-flying aircraft.

He said Russia was keen to increase participation in the ‘Make in India’ program and would welcome proposals from Indian public and private companies for joint production of military equipment.