Russia

Pipavav Defence inks pact with Russian firm Zvyozdochka to refit submarines

Anil Ambani-led Reliance Group’s Pipavav Defence and Offshore Engineering (PDOE) inked a multi-crore agreement with Russian firm Zvyozdochka, JSC Ship Repairing Centre.

The agreement was signed in lines with Make in India initiative for the Medium Refits and Life Certification of 877 EKM Submarines in India. With this, Reliance Group became the first private sector Indian company to refit of submarines in India.

Both entities will execute the programme under a joint venture (JV) company with an indicative value of 11,000 crore rupees in which PDOE will have 51 per cent stake.

As per the agreement, Zvyozdochka will provide complete technical support and assistance to the JV Company. It will also provide the enhancement of infrastructure at the PDOE facilities in Gujarat and training of engineers.

Apart from India, the JV Company will undertake similar work for large submarine forces of similar class deployed by countries such as Vietnam, Algeria and Iran.

It should be noted that Zvyozdochka is the premier ship repairing centre in Russia and has undertaken upgradation and refurbishment of more than 90 warships and 120 submarines.

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BRICS bank starts its operations from Shanghai, China

The New Development Bank (NDB) created by Brazil, Russia, India, China and South Africa (BRICS) nations formally started its operations from its headquarters in Shanghai, China.

Chinese Finance Minister Lou Jiwei, Shanghai Mayor Yang Xiong and the bank’s first President K V Kamath from India attended the opening ceremony.

About New Development Bank (NDB)

Agreement for establishing NDB was signed during the 6th BRICS Summit being held in Fortaleza, Brazil in April, 2014. It was formally launched at the 7th BRICS summit held in Ufa, Russia in July 2015.

Purpose: To fund infrastructure projects in the emerging economies. It is seen as an alternative institute to west dominated World Bank and the International Monetary Fund (IMF).

Capital: It will have initial capital of US 50 billion dollars and will be raised to US 100 billion dollars within the next couple of years.

Each members role:  They will have an equal say in the bank’s management, regardless of GDP size and contribute an equal share in establishing a startup capital.

President: Eminent banker Kundapur Vaman Kamath from India is President of Bank for the first five years i.e. till 2020.

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INSTC, India’s strategic gateway to Central Asia and Eurasia

The International North-South Transport Corridor (INSTC) is considered as gateway for India to expand trade and investment links with Central Asia and Eurasia.

Its importance was highlighted in India’s Foreign Trade Policy of India 2015-20.

However, recently it gained importance in light of the evolving geopolitical developments of India after Prime Minister Narendra Modi’s visit to 5 Central Asian Countries viz Uzbekistan, Kazakhstan, Turkmenistan, Kyrgyzstan and Tajikistan.

International North-South Transport Corridor (INSTC)

  • It is a multi-modal trade transport network that includes strategic rail, road, and water transport connecting India with Central Asian and Eurasia Countries.
  • Route: It will connect Mumbai (India) via Chabahar and Bandar Abbas ports of Iran with Baku (Azerbaijan) to Moscow (Russia) and other countries in Central and Eastern Europe via the Caspian Sea.
  • Economic Integration: It will help in facilitating India’s economic integration with Eurasian economies and other countries in surrounding regions.
  • If India partners with Eurasian Economic Union (EEU), it will further boost and expand its economic, trade and investment opportunities in more countries in this region.
  • Shorter transport route: It will be a shorter route to transport goods to Eurasian and Central Asian regions compared to present route via Suez Canal and western European countries. Thus, reduce the cost of transporting goods from India to Eurasia.
  • Natural resources access: It will help India to tap the abundant natural resources potential of Central Asian countries for its energy security. These countries are having rich deposits of petroleum, natural gas and uranium along with deposits of fertilizer inputs such as potash.
  • Exports: Many sectors in this region are becoming increasingly service-oriented which can benefit India to export expertise in information technology and IT-enabled services.

Implications

For India, the INSTC will be strategically important trade corridor of tremendous promise that could help to develop its economic and strategic importance in Eurasia and Central Asia. It could also give India economic and strategic relevance to tackle regional ambitions of China through its One Belt, One Road Initiative.

Map Source: CIA

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