Let this deal happen Russia will have less weight in the multilateral say to India. But India has to balance the force b/w UN/IMF/ADB/WorldBank.
Leading | Export Partner | Import Partner.
Russia | European Union | European Union
India | European Union | European Union
Japan | China | China
CAB ($bill.)
Russia |90.510| 2011.
India |-62.960| 2011.
Japan |122.800| 2011.
see India is import hungry country with -ve CAB. Russia and Japan are both with +ve CAB. Means more share in Foreign Reserve, so more voting power in IMF/WorldBank/ADB etc.
current account deficit reached a record 13 percent of GDP in 2011 for Russia due to underlying oil price volatility.
Means lowering of Currency Rate and Increase in domestic price, Inflation, unrest etc etc. so Russia needs urgent Export Growth. India also has CAD of about 5.1% to 5.5% of GDP ( don't remember exactly).
So what should India do.
India
--Needs to do a
Currency Swap Agreement with Russia as it did with Japan.
India, Japan sign $15-billion currency swap deal
India needs to diversify the basket of Export and Economic linkages as Russia is doing , as India's CAD is also much high.
--Needs to create more systemic linkage with Russian Economy.( with not only arms ).
------------------------------------------------------------------------------------------------------------------------------------------------- Indian leaders kab jaagege !