India-Russia Relations: Navigating the New Geometry of Global Trade in a Multipolar World

Russian President Vladimir Putin's visit to India beginning December 4 arrives at a critical juncture when the global economic and strategic landscape is experiencing profound transformation. His presence in New Delhi represents not merely a reaffirmation of a long-established partnership, but offers insight into how India-Russia relations are being reshaped amid broader shifts in global trade, finance and security. The remarkable increase in bilateral commerce, intensifying debates around sanctions, and growing influence of non-Western coalitions reflect a larger change: the dissolution of singular hierarchies and emergence of multiple, interconnected economic networks. Putin's visit provides a timely perspective for understanding how India should position itself in this fluid global environment.

This transition is multifaceted rather than linear. It is complex, uneven and sometimes contradictory. However, it presents India with a unique opportunity to shape, not merely respond to, the evolving framework of globalization's next phase. India-Russia trade has reached unprecedented heights, climbing to USD 68.7 billion in FY 2024-25, primarily driven by discounted energy imports. While this appears successful on paper, the reality reveals significant imbalance: over USD 63.8 billion consists of Russian exports to India, while Indian exports remain under USD 5 billion. The unresolved rupee-rouble payment mechanism continues to limit further growth.

Is this growth pattern sustainable? Partially. As long as energy flows remain economically advantageous and sanctions continue pushing Russia eastward, India will remain a key market. However, long-term durability requires structural adjustments - diversification of India's export portfolio, reciprocal investment, and payment mechanisms that avoid current bottlenecks. Without these corrections, the trade surge may reverse once geopolitical circumstances shift or energy price differentials narrow. This surge represents a temporary window rather than permanent realignment. Whether it becomes an enduring economic pillar depends on how quickly both nations can rebalance their relationship beyond oil.

The relevance of the global trade governance system faces increasing scrutiny. As the United States and Europe increasingly deploy tariffs, export controls and financial restrictions as strategic tools, questions arise about the multilateral system's effectiveness. The WTO, hampered by its paralyzed dispute resolution mechanism and outdated regulations, shows visible strain. Yet it remains far from obsolete. For developing nations including India, the WTO continues to provide the only universal platform restraining unilateralism and offering a predictable framework for export-driven growth. What we're witnessing is not the WTO's demise but the emergence of a hybrid system: formal multilateral rules coexisting alongside dense networks of bilateral and plurilateral arrangements.

Platforms such as BRICS+, regional trade agreements, supply-chain partnerships and local-currency payment systems are becoming laboratories for new norms. India faces a dual challenge: leading efforts to reform the WTO to better reflect Global South priorities, while simultaneously leveraging various coalitions to hedge against disruption and build influence in a world no longer operating on a single system.

President Putin's India visit has reignited debates about the effectiveness of unilateral sanctions. Russia presents a complex but instructive case. Despite extensive Western restrictions, Russia has redirected trade flows, stabilized certain macroeconomic indicators, and strengthened connections with Asian partners. Sanctions have imposed costs, but not triggered the systemic collapse many predicted.

This reveals two important truths. First, sanctions remain effective when supported by broad international participation—something increasingly rare. Second, Global South nations, including India, view unilateral sanctions imposed outside the UN framework skeptically. They perceive them not as justice instruments but as geopolitical pressure tools, often indifferent to third countries' developmental interests. What's emerging isn't a sanctions-free world, but one where alternative legitimacy systems—South-South finance, local-currency arrangements, BRICS coordination—diminish the impact of unilateral coercion. The West will eventually need to adapt to this diffusion of economic power.

India's relationship with Russia continues to rest on two pillars: energy security and defense cooperation. Though proportionally declining, the defense component remains significant: Russia still accounts for approximately one-third of India's defense imports. Joint initiatives like BrahMos exemplify the transition from a buyer-seller dynamic to a co-development model, while the S-400 systems' performance has reinforced India's operational confidence. Simultaneously, India is aggressively diversifying—toward the US, France, Israel, and domestic industry under "Make in India." The goal isn't eliminating Russia but preventing overdependence on any single source. Strategic autonomy in an era of fragmented globalization will come not from decoupling, but from layered partnerships, supply chain redundancy, and strengthened indigenous capabilities.

Discussion of an alternative global economic bloc—insulated from Western regulation—has gained momentum with Russia's eastward pivot and the Global South's push for resilient supply chains. However, economic realities are more nuanced. New structures are indeed developing: local-currency settlements, BRICS financial instruments, diversified logistics corridors, and expanded South-South trade. Yet global value chains remain deeply interconnected with Western capital markets, technology ecosystems and regulatory standards. Constructing a completely insulated parallel system is neither feasible nor efficient for most economies, including India.

What's emerging instead is a multi-layered global economy—not a bifurcated East vs West model, but a world of overlapping networks where countries maintain diversified connections to maximize resilience and negotiating power. For India, this represents an opportunity rather than a threat. Its integration with both Western and Eastern systems provides rare leverage—provided it invests in alternative frameworks without abandoning existing ones.

The India-Russia relationship is not a historical relic but a lens through which the world's new economic geometry can be observed. Trade increases, sanctions resistance, bloc politics, shifting defense dependencies—each represents an aspect of a larger transformation. The emerging order will not be bipolar but fluid, contested, and multi-nodal. India's challenge is to utilize this period of flux to shape rules, diversify options, strengthen domestic capabilities, and ensure strategic autonomy remains anchored in economic resilience.

In a world no longer organized around a single center of gravity, navigation—rather than alignment—will define success.

The author is President, Chintan Research Foundation

Disclaimer: These are the personal opinions of the author