Since the current crisis in Russia has arisen out of western sanctions, a bi-lateral currency agreement would benefit both countries in the long run.

In 2013-14, the Indo-Russian trade amounted to S6.01 billion with the balance of trade in favour of Russia, as Indian exports during the same period stood at $2.121 billion only.

Apart from major exports like pharmaceuticals ($535 million), other items such as electric machinery ($ 170 million) Iron and steel ($128 million) and agri-produce ($117 million) comprised our exports. Our bilateral trade with Russia is settled in US Dollars. It is projected that this may actually increase to over $30 billion by 2025, if our trade relations grow at current rates.

The recent happenings in Ukraine have been a damper. Because of Russia's annexation of Crimea and the resultant crisis in Ukraine, the Russian relationship with the West has deteriorated to the extent of attracting sanctions from the West, which is USA and Europe. Although Europe is heavily dependent upon Russian gas supplies, this intervention has not been taken kindly by them.

Russia has announced its plans to scrap the South Stream pipeline project to supply gas to Southern Europe without crossing Ukraine and has proposed an alternative gas pipeline via Turkey to whom it has offered gas at a discount. Gazprom is reported to have signed a Memorandum of Understanding with Turkey's Botas for the pipeline, proposed to run under the Black Sea. A lot of technical and commercial details will still have to be worked out on this project.

In the meantime, it is reported in the press that, Ajai Sahai, Director General and CEO of Federation of Indian Exporters Organisation has plans to meet the Commerce Ministry to seek their assistance if the Government can work out some sort of Rupee payment agreement with Russia, because of the fall in the Rouble-Dollar parity since the Rouble's free fall in the recent past.

It may be recalled that when the sanctions were imposed on Iran by Western Powers, led by USA, as both Iran and India were inter-dependent on oil supplies, to circumvent the impasse, a rupee account was set up in the UCO Bank, Kolkata, which was used as a conduit for settlement of trade between both the countries. Since the current crisis in Russia is similar, arising out of western sanctions, Ajai Sahai feels a similar proposal can be brought into use, by both Russia and India, as this will benefit both nations.

Also, during the recent visit of Russian President Putin, projects and other details worth much more than $20 billion were concluded as reported in the press, which includes, Essar's 10-year multibillion dollar oil deal; Alrosa's pact for direct sale of rough diamonds; NMDC-Acron of Russia's deal to acquire a potash mine in Russia among others. Recently, Russia also relaxed the rules to permit the importation buffalo meat from India.

An indepth study and initial limitation of Rupee-Rouble agreement stipulating the total value that can be made in this manner would be a good start. Because of the steep fall in Rouble realisation, Russia is bound to control or reduce its export of wheat and India may find it worthwhile to have an "understanding" of wheat export price, wihch would also help to stabilise the market.

However, all these may also depend upon how the proposed first visit of an American President, as Chief Guest on Indian Republic Day goes and the result of discussions during the visit that he may have with the Indian Government.

(AK Ramdas has worked with the Engineering Export Promotion Council of the ministry of commerce. He was also associated with various committees of the Council. His international career took him to places like Beirut, Kuwait and Dubai at a time when these were small trading outposts; and later to the US.)