RUSSIA may agree to buy more Indian tea, tobacco, rice and wheat during a high-level government meeting between the two countries this month, a top diplomatic source said.

The seventh session of the Indo-Russian inter-governmental joint commission is scheduled to begin in Moscow on January 15 and will concentrate on strengthening bilateral trade ties, the source said.

Both countries had discussed increasing Russia's purchase of Indian tea and tobacco through the rupee route during President Vladimir Putin's state visit to India last October and the Russian side had agreed to hike its imports.

The forthcoming session may take some concrete steps to increase Indian exports of tea, tobacco and also rice to Russia against debt repayment rupee funds.

The commission will also discuss export of Indian wheat to Russia. Russia usually imports eight to 10m tonnes wheat every year, and this year, in spite of a bumper yield, Russia needs to buy around eight million tons of wheat for its requirements.

Experts feel India, which has never sold any wheat to Russia, should step in to feed the Russian demand, given its huge stock of foodgrains.

Both countries have had some basic discussions on wheat trade, and a decision on purchase of Indian wheat is also expected at the session.

India's import of coking coal from Russia will also come up. At present, India buys most of its coking coal for its metallurgical plants from Australia.

After the Russian financial meltdown in August '98, lack of proper banking arrangements stood as a major impediment in trade ties with Russia.

In the absence of proper banking arrangements, both sides are concerned about future bilateral trade after rupee funds are exhausted in the next three years. Nearly 85 per cent of Indo-Russian trade is conducted through the rupee route.

An important Indian banking delegation led by the executive director of the Reserve Bank of India recently visited Russia to identify Russian banks which can have a working relation with Indian banks.

The source said both countries feel trade ties do not match up to potential and the increasingly political affinity between them.

The session will be jointly presided over by finance minister Yashwant Sinha and Russian deputy prime minister Ilya Klebanov, the respective co-chairmen of the joint commission from both sides.

Sinha will also meet Russian Prime Minister Mikhail Kasyanov during his two-day visit for the session. (16/01/2001)

The Economic Times

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