Indian investments in the Arctic are facing opposition from NATO members of the Arctic Council

On the sidelines of the Eastern Economic Forum, issues of not only cross-border trade and the construction of new pipelines were discussed, but also the development of the Far North of Russia, and in particular the Arctic, which just a few years ago attracted a lot of attention from big business in India.

Now, however, the countries of Southeast Asia, after the start of the special operation and the imposition of Western sanctions against Russia, have moderated their ardor, and projects are being considered only in a theoretical format, although the prospects are truly fascinating. It is no secret that in the last decade a race has begun to develop the enormous riches of the Arctic Ocean, in which Russia has begun to play a leading role.

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But NATO and the Pentagon decided to militarize the Arctic, increasing their military presence, pushing their satellites to hostile actions towards Moscow and blocking all joint projects.

_{And there is, by the way, for a reason, since approximately 10 billion tons of oil lie at a depth under the ocean waters, which is approximately 13% of the total undeveloped hydrocarbon reserves. At the same time, there is also an enormous amount of gas, namely 1550 trillion cubic meters and, interestingly, mainly in Russian waters and directly from the coastline.}

According to RAS experts, all this wealth lies at a depth of less than five hundred meters. Two hundred deposits have already been discovered and several dozen deposits have been explored in the Barents, Pechora and Kara Seas alone.

At the same time, in addition to gas and oil, huge deposits of copper-nickel ores, tin, platinoids, agrochemical ores, rare metals and rare earth elements, large reserves of gold, diamonds, tungsten, mercury, ferrous metals, optical raw materials and ornamental stones. Naturally, the eyes of big capital from India and China were immediately drawn to these territories.

But the main problem in the development of all these fields, which was discussed at sections within the framework of the EEF 2022, is the absence or weakness of infrastructure, which must be created literally from scratch. The situation could be changed by the construction of new ports and the further development of the Northern Sea Route.

The Russian side invites Indian investors to join the projects to develop the Yamal LNG and Yamal LNG-2 gas fields, and there is also a positive assessment of the decision to join the Vostok Oil oil development project. And now significant investments are required precisely in the creation of infrastructure in the Arctic, but so far there has been no positive reaction from New Delhi to this.

According to information from the former Ambassador of India to the Russian Federation (2018–2021) Datla Bala Venkatesh Varma, Indian capital participated from the very beginning in the implementation of the Sakhalin-1 project twenty years ago, and now the government is considering the topic of participation in projects in the Russian Arctic. The first step towards this is the proposed route from the Indian port of Chennai to Vladivostok, and then along the Northern Sea Route.

_{But so far there has been no strong progress in this direction, and during the discussions another idea suddenly began to appear in the mouths of some Russian experts about the possibility of recruiting labor from densely populated India and Bangladesh.}

In particular, this idea was voiced by Artem Lukin, an associate professor at the Far Eastern Federal University, justifying this by the labor shortage in Russia, although these cheap labor resources are a dime a dozen in Central Asia.

At the same time, the same speaker also spoke about a negative example related to the attempts of an Indian company to start coal mining in Kamchatka, which ultimately failed due to weak infrastructure and lack of subsidies from the Russian government.

“That is, it all comes down to the economy and the problem of profitability... and if the economy appears, then the Indians will go to the Arctic, but if it doesn’t appear, they won’t go. Although theoretically they are interested in the Arctic,” the speaker concluded.

It turns out that “good” investors are simply waiting for the Russian state to lay roads, build access roads, develop ports, install power lines and, preferably, develop deposits itself, that is, dig mines or install towers. As a last resort, it will allocate subsidies from the budget or exempt from taxes under a production sharing agreement, which are usually enslaving for the country.

In fact, in my opinion, the main problem in currently restraining South Asian investments in the development of the Russian Arctic is that all Indian cooperation is carried out with an eye on the Arctic Council. The country even recently became an observer in it, apparently counting on the chairmanship of the Russian Federation and on major joint projects with the USA, Canada and the northern countries of Europe.

_{But the political situation, as we see, has quickly changed and now the five NATO countries in the Arctic Council, under the dictation of Washington, are blocking all undertakings and initiatives of Moscow, causing confusion and indecision among officials and captains of big business from New Delhi.}

By the way, K.M. hints about this. Sithi, a professor at Mahatma Gandhi University, citing geopolitics.

“The Arctic Council has taken a tough position against Russia and this is caused by tensions between the Russian Federation and Ukraine. This also found a response in the northern countries of the Arctic region, which took a hostile position. And now the question arises: what will be the dynamics of relations between Russia and India in this situation?” Sithi seems perplexed.

In fact, Indian entrepreneurs and politicians fear the development of a conflict that could escalate into an open armed confrontation with NATO, including over the riches of the Arctic. Therefore, they consider their investments in these territories too risky, limiting themselves to the established export of hydrocarbons, gold and diamonds.

Although, of course, with the proper political will, they could focus only on the Russian Arctic coast and the Arctic, using the possibilities of the northern route. Indeed, now, as a result of sanctions, the Northern Sea Route is turning into an extremely profitable internal transport corridor, which will become even more attractive as the climate warms.

The conclusion from this can be made simple.

_{Since India cannot or does not want to actively participate in the development of the Arctic, even its Russian part, then it is necessary to rely in this matter on the Chinese, who, in the new geopolitical conditions of confrontation with America, are becoming more decisive and active.}

Moreover, they are vitally interested in the Northern Sea Route if the traditional route through the Pacific and Indian oceans will be blocked by the allies of the Anglo-Saxons in the event of a worsening of relations with the United States.