Russia and India agree to step up cooperation

Russia and its traditional ally India agreed Tuesday to increase cooperation in nuclear power and oil and gas projects to help fuel the energy needs of the South Asian giant's rapidly expanding economy.

Russian President Vladimir Putin and Indian Prime Minister Manmohan Singh also discussed India's growing demand from Russian military hardware.

"Relations between Russia and India are of a truly strategic nature," Putin said as he sat down for talks in the Kremlin with Singh.

India has bought more than US$30 billion worth of Soviet and Russian arms since 1960. In recent years, it has been second only to China as a buyer of Russian weaponry.

Russia and India also conducted joint military maneuvers this year, and are discussing working together on a next-generation fighter jet and a medium-range transport aircraft.

"Russia occupies a special place as the leading supplier of military hardware to our armed forces. In the future, the aim is to move towards collaborating on projects involving the design, development and production of the next generation of military products," Singh said after the talks.

While Russian arms exports to India boomed, other economic ties have remained sluggish. Bilateral trade has declined to US$1.8 billion annually since the Soviet collapse and has been stagnant for the past few years. Putin referred to the issue at the start of Tuesday's talks.

"We have problems which we must discuss with you, that is the development of our trade and economic relations," he told Singh. "Here we have much to do."

Singh said before leaving for Moscow that India wants to develop closer energy ties with Moscow. Officials said that Singh would promote India's efforts to boost investment in the Russian oil industry, especially in fresh exploration blocks on Sakhalin Island, off Russia's Pacific Coast.

India is looking for sources of oil and petroleum to power its burgeoning energy needs. India's state-run oil company ONGC Videsh Ltd. has already invested US$1.7 billion in an oilfield in Sakhalin Island.

Putin said that India voiced interest in further development of the Sakhalin project during Tuesday's talks.

He said that Russia, which is building a nuclear power plant in India, was ready to develop cooperation in the nuclear field, the AP reports.

V.Y.