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ITE Transport and Logistics

India & Russia: Shaping global transport & logistics

India and Russia. One the world’s largest country, the other is the world’s largest democracy. Both nations don’t do things by half measures – and trade is one area where the values are high and the growth prospects are plentiful.

Globally, the two nations are massive transport and logistics players. Now, with the implementation of continent-crossing transport corridors, and plans afoot to boost trade to mammoth levels, Russia and India could become drivers of global logistics.

Indo-Russia trade totals in the billions of dollars but is ready to expand

For the last five years, trade between both nations has collectively totalled around $6 billion, and has remained consistent. Between 2016 and 2017, however, trade has received 22% bump, reaching a bilateral value of $7.5 billion.

We can see the increased levels of cross-border trade between these partners by taking a look at levels from a decade ago. Between 2007-2008, for instance, India’s exports to Russia amounted $0.94 billion, reaching $1.9 billion by 2016.
On the reverse, Russia’s Indian exports rose from $2.5 billion in 2007-2008 to $5.7 billion in 2016.

Why? Cooperation between India and Russia has been a hot topic for both states since at least 2000. Since then, numerous agreements, treaties, and partnerships have been initiated, starting with the signing of the “Declaration on the India-Russia Strategic Partnership” at the turn of the millennium.

The latest agreement was inked in 2014. “Druzhba-Dosti: A vision for strengthening the India-Russian partnership over the next decade” has been designed to ensure each nation remains economically linked until at least 2024.

In September 2017, at the Eastern Economic Forum held in Vladivostok, Russia, cooperation deepened. Here,  further bilateral trade expansion has been planned out, with the goal of increasing levels of trade from Far East Russia to India to $35 billion annually by 2025.

In terms of cargoes, India’s imports from Russia include gems and jewellery, representing 45% of all trade, alongside petroleum products, iron & steel, fertilisers, and paper products.

On the other hand, Russia imports pharmaceutical products, machinery, beverages, organic chemicals, and aircraft equipment from India.

Two transport corridors in the pipeline

To facilitate these expansive trade ambitions, India and Russia are intimately involved in the planning, construction, and running of two international transport corridors.

With all eyes on China’s monumental “One Belt One Road” initiative, Russia and India’s continent-spanning travel routes may have flown a little under the radar, but they are no less significant for worldwide transport & logistics.

The North-South Transport Corridor (NSTC)

Firstly, there is the enormous North-South Transport Corridor. Originating in India, this route has been designed to drastically slash both transit times and costs between Mumbai and St. Petersburg.
Covering 7,200 kilometres, the multi-modal network avoids the traditional Suez Canal sea route, which normally takes 45 days. By starting on ships in Mumbai, then transferring cargoes onto trucks and trains, moving them through Iran and Azerbaijan, loads now only take two weeks to reach Russia.

It is estimated the costs of moving goods between India and Russia could drop by as much as 30% when the NSTC becomes fully operational.

Green Corridor

Another huge development India and Russia are involved is the Green Corridor project; not strictly a physical corridor, more a type of customs-free route on lines commonly used to move goods between the pair.

"The main advantage of the 'green corridor' is that goods being transported by entrepreneurs will not have to undergo customs inspection and examination when crossing the border - measures now commonly used to minimize risks. This also applies to documents. Samples and specimens will not be taken. The provision of original copies of documents is not needed, and so on," a representative from the project said.

Essentially the green corridor works like this: an electronic pre-declaration is issued for the cargo, and assigned a unique individual number which will then be logged in a corridor-specific registry.

Customs inspectors with access to the registry will already know what goods are being shipped and does not need to inspect them. Without stopping, the cargo passes through the customs clearance post towards its destination. 

In addition, it is assumed that for Green Corridor participants, there would be a separate post/special inspectors at customs stations along the route.

India: Meet Russia’s transport & logistics industry at TransRussia

With bilateral freight turnover on the grow, and both countries improving necessary cargo infrastructure accordingly, Russia is emerging as one of the strongest markets for Indian transport and logistics providers (and vice versa).
In order to meet Russia’s top logistical decision makers, suppliers of transport and logistics services, or to demonstrate your produces and solutions to the Russian market, there’s one place to be – TransRussia.

The event is Russia’s only transport and logistics exhibition, designed to put international businesses needing transport services in touch with Russia’s logistics service providers.

Want to learn more about the show, or want to find out how you can take part? Contact our team today to get all the information you need on TransRussia.


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