India, Russia Seal Defense Deals Worth Billions
by Anjana Pasricha December 24, 2012
India and Russia have sealed defense deals worth billions of dollars during a visit by the Russian president, in a move which reaffirms the long-standing strategic alliance between the two countries.
Calling Russia a key partner in the effort to modernize India's armed forces, Indian Prime Minister Manmohan Singh announced the deal to buy 71 military helicopters worth $1.3 billion, and kits to assemble 42 Sukhoi fighter jets worth $1.6 billion.
India and Russia were close allies during the Cold War days, with Moscow being the main supplier of India's armed forces. But analysts say Russia has been losing out on India's lucrative defense market in recent years, as New Delhi increasingly hands out contracts to countries such as Israel, France and the United States, establishing closer links with many Western countries.
The trend has sparked concerns in Russia that the country is losing its dominant position in the Indian military market.
However, Moscow remains a key defense supplier and the two countries also retain a close political relationship.
On Monday, India's leader called Putin a "valued friend."
"We deeply value Russia's steadfast friendship, and support for India unaffected by global developments,' Singh said. 'This relationship has a special place in the hearts and minds of the people of India, and India remains committed to further deepening it."
The Russian leader, making his first visit to New Delhi since starting a new term in May, was also effusive. In an article published in a leading Indian newspaper, Putin wrote that "deepening friendship and cooperation with India is among the top priorities of our foreign policy."
Increasing trade with India, which the Russian president called one of the world's fastest growing economies, was also high on Putin's agenda, who said he wants to double bilateral trade with India from the current $10 billion to $20 billion. Trade between the two countries has grown slowly in recent years.
The two sides also signed agreements on trade, science, education and law enforcement.
Putin said the deals demonstrate the two countries' mutual aspiration to develop political dialogue, investment, trade relations and people-to-people contact.
The two leaders also reaffirmed their commitment toward stabilizing Afghanistan, and making it free from extremism.
"We reviewed the ongoing developments in Afghanistan,' Singh said, 'and agreed to work together against threats posed by extremist ideologies and drug trafficking.
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