INDIAN-RUSSIAN PARTNERSHIP: LOOKING AHEAD AT FUTURE

Alok Kumar, Group Chairman, Akis Tech Ltd., Chairman IIT Alumini Council, Russia Chapter
Honorary Governing Body Member & Director (Russia), BRICS Chamber of Commerce & Industries,
President, Russia & Central Asia, Economic Council of India Member, Board of the Business Council for Cooperation with India

It is of primary importance to continue and broaden cooperation in traditional sectors such as energy, mining, pharmaceuticals, aircraft engineering, space technologies. “New Economy” projects in science and technology and Artificial Intelligence (AI) are avenues where both Russian and Indian IT specialists and researchers can bring forth substantial expertise.

We need to develop and deploy sustainable technologies at a faster pace to successfully tackle the major socio-economic challenges and changing aspirations of the people. Along with this it is vital to develop and deploy those technologies indigenously to bring sustainability and inclusive growth for the benefit of society at large.

INDIA: CURRENT SCENARIO
Currently, India stands as an innovative superpower and a major force in shaping the future global economy. It is the fastest growing major economy, projected to rank third in the world by 2030, with a GDP growth of +6.8% in 2024.
India boasts the world’s youngest population, characterised by a rapidly expanding middle class. In 2024, with 65% of its 1.4 billion people under the age of 35, it constituted 31% of the population.
India ranks second in the number of mobile phone users, with its 5G network covering over 90% of the country’s territory. The number of Internet users exceeds 750 million. Moreover, India is the largest consumer of data, reaching nearly 20 GB per mobile device per month (expected to rise to 62 GB by 2028). Virtually the entire population of India has transitioned to the digital biometric identity “Aadhaar” (similar to the U.S. SSN but with full biometric verification, including retinal scans and fingerprints). The country is also an undisputed leader in digital payments, accounting for 46% of all digital transactions worldwide.

Big companies are investing in India: over 1,500 multinationals have set global capability centers, employing 1.66 million people. This figure is expected to grow significantly over the next two years, with over 1,900 such centers employing more than 2 million people by 2025.

India is among the top three countries in the world for its startup ecosystem, home to 111 companies with a combined market capitalization of approximately $350 billion.

India’s technology priorities include:

• Traditional strategic technologies (defense, nuclear, space, and dual-use technologies).
• Critical digital technologies (such as semiconductors, electronics, telecommunications, and digital public infrastructures).
• Emerging technologies (such AI/machine learning, quantum computing, and drones).
• Clean/green technologies and biotechnologies.

India aims to become a global AI hub that will go beyond integrating foreign chatbots and drive the next generation of AI-powered innovation to empower billions of citizens.

Artificial intelligence is the kinetic factor of the digital economy, and the government plans to incorporate it into all areas of activity, also focusing on global leadership in the field.
Indian government is expanding the Quantum Mission / Hydrogen Mission INDIAai in partnership with technology companies, start-ups and academic institutions as part of a comprehensive programme to develop and implement AI. According to the latest report, India currently ranks first in terms of AI skill penetration and concentration of AI talent, boasting a rate of 3.09—the highest among all G20 nations.

NEW INDIA: FUTURE IS VIRTUAL
The Indian industry is consistently strengthening its digital capabilities by adopting deep tech technologies and focusing on deploying emerging technology solutions such as AI, Cybersecurity, and IoT.
In the 2023 financial year, the technology sector is expected to employ 5.4 million people, contributing 53% to India’s service exports. In 2022, India secured second place for the number of new startups, with the emergence of 23 unicorns and over 1,300 new tech startups. The same financial year, over 280,000 employees were reskilled to acquire digital competencies.

TEAMWORK MAKES DREAM WORK
In the 21st century, on the path to becoming a global knowledge economy India and Russia find opportunities and face challenges. Over the next two decades, scientific ministries and research institutions across various countries will derive strategic advantages from collaboration through alliances and partnerships that can yield significant benefits.

For instance, the R&D results achieved through joint alliances can directly contribute to national R&D priorities and influence societal and economic development. Through interaction and cross-country exchanges, it is possible to build up institutional and human capacities, create new paradigms of sustainable growth, and develop modalities and mechanisms aimed at seamlessly integrating Indian and Russian research into global efforts, particularly at the frontier areas of science and technology and those addressing global challenges.

Absorbing experience of existing global research institutions can contribute to fine-tuning and/or coupling with upcoming or existing research facilities.

Certain clear tasks which need to be pursued are listed below:
(a) Increasing the number of joint events through SME, startup and academic competitions and scientific programmes, while ensuring mutual access to unique research facilities / assets and commercialization of new technologies.
(b) Fostering business interactions between deep-tech innovative SMEs through specialized investment funds (both state and private capital), and by attracting additional funding and easing the entry of these enterprises into the Russian and Indian markets.
(c) Expanding partnerships between Russian and leading BRICS+ nations and partners, Indian incubators, technology parks, and innovation centers.
(d) Accelerating SMEs and enhancing industrial cooperation, establishing Technology Promotion
Close interaction and cross-country exchanges pave the way for creating new paradigms of sustainable growth, reaching national priorities in R&D, and addressing global challenges.
Centers in Russia, India, and other BRICS+ countries with the assistance of qualified and reliable intermediary companies and consultancies that provide technical support, technical translations, and legal assistance.
(e) Developing new instruments for fellowships, internships, young entrepreneurial exchanges, and joint development of technologies.
(f) Exploring the market of new technologies in BRICS+ countries.

Specifically for Russian companies, we propose the establishment of a Center of Excellence in India. This center would serve as a hub for R&D activities, leveraging India’s pool of highly skilled and cost-effective engineers. Special stress will be placed on the potential of the joint development of new-age technologies such as AI, the IoT, blockchain, and cybersecurity.

By collaborating with the Indian industries, academia, and IT experts, Russian companies could develop innovative solutions that could be exported to global markets, fostering technological advancements and deepening the India-Russia partnership in strategic sectors.

DIGITAL TECHNOLOGIES: CHALLENGES AND TASKS
The main challenges in developing digital technologies are related to disruptions in supply chains, particularly due to sanctions or their threat (secondary sanctions), the gap in legal frameworks (laws) in the field of digital technologies, and the lack of a unified approach. Moreover, experts highlight a low awareness about the potential applications of digital technologies, a shortage of specialists, and a restricted regime of industry-related data.

Together with Russia India could align legal documents on digital issues (such as data protection), which would enhance trust and improve accountability in the business environment.
India has opportunities to implement AI technologies in agriculture, healthcare, and smart cities, which corresponds to the 2018 National Artificial Intelligence Strategy and the Russian National Strategy for the Development of Artificial Intelligence up to 2030.

Furthermore, India and Russia should establish special centers for the practical implementation of AI technologies across various economic sectors.

MICROELECTRONICS
In microelectronics, India can increase exports in areas where niches have been left following the withdrawal of Western manufacturers from the Russian market, as well as participate in expanding the parallel export of Western goods to Russia. The most promising thing is that both countries are allocating significant funds for microelectronics production facilities, the development of proprietary software, and fundamental algorithmic models.
Both countries are interested in staff training in microelectronics. But given that many skilled professionals are moving to other countries in search of work and decent salaries, it is necessary to create more promising enterprises offering career growth, better working conditions, competitive salaries, and the use of grant funds.
In 2023, India developed the Modified Semicon India Programme

The main issues in developing digital technologies are disruptions in supply chains, including those due to sanctions or their threat, the gap in legal frameworks, and the lack of a unified approach.

(MSIP), which was approved following consultations between the government and various semiconductor companies and private experts. This strategy comes because the initial strategy received dismal response from the global players, as only five applications were considered—from three semiconductor companies and two display manufacturers. The modified strategy is expected to resonate with a greater number of global players and spark their interest in establishing semiconductor and display facilities in India. This programme provides companies, consortia, and joint ventures planning to open relevant plants in India at any node (including mature nodes) with a financial incentive of 50% of the project cost. It also offers fiscal support of 50% of capital expenditure in the production of compound semiconductors and semiconductors.

The demand for semiconductors will continue to grow: by the 2026–2027 financial year, electronics in India is expected to reach $300 billion, with exports amounting to 120 billion (compared to $23.57 billion in the 2022-2023 financial year).

GENERAL CHALLENGES
India and Russia should work to enhance trust and accountability in their joint projects and business interactions. Both countries should engage expert communities and thinktanks, maintaining systemic contact through special events dedicated to cooperation in specific areas.

Efforts should also be made to intensify and expand academic exchanges between the nations. India is ready to increase the number of Indian specialists sent for training in Russia. This will not only facilitate the training of personnel in relevant fields but also form a more influential and numerous Indian professional community in Russia, who will attract investments from India to Russia and vice versa. Moreover, India should reshape its image in Russia and increase awareness of Indian scientific and technological projects among Russian business, scientific, and expert communities.

The Indian government has also expressed interest in collaborating in human resource development, natural and energy resources, trade and investment, nuclear and solar energy, and space.

However, the zero-sum game, where countries aim to increase domestic production and enhance local technologies, fostering mistrust and hindering the implementation of large investment projects, represents an extremely serious barrier to bilateral relations. Moving away from this approach, which focuses on bolstering national capacities, seems feasible when countries strike a balance between local manufacturing and market openness.

WHAT LIES AHEAD?
Some time ago, at the India-Russia Business Summit, Indian Prime Minister Narendra Modi remarked, “India gives top priority to its relations with Russia. Our Special and Privileged Strategic Partnership has consistently received new energy... India and Russia are unanimous in strengthening multipolarity and multilateralism in this rapidly changing world. We have agreed to continue our beneficial cooperation and coordination in international institutions.”

Clearly, India and Russia are destined to remain role models of harmonious and mutually beneficial partnership and strong friendship. Building on the shared vision of the development of bilateral relations, the warm ties between New Delhi and Moscow bring to life the old adage: “An old and trusted friend is better than two new ones.”