Armenia offers India a trade corridor to Russia bypassing Azerbaijan

Armenia proposes to India to create an additional trade route for the delivery of goods to Russia and Europe, which will pass through the Black Sea parallel to the International North-South Transport Corridor (INSTC) bypassing the Suez Canal, informs newspaper The Economic Times.

According to the newspaper, such a proposal was made by a group of Armenian officials and experts during the visit of the Armenian Foreign Minister to India. Sources in the government of the republic reported that Yerevan intends to attract Indian investments for the corridor on the territory of Armenia. Since the outbreak of hostilities in Ukraine, the volume of trade between India and Russia has increased “many times” through the INSTC corridor, where Azerbaijan is a key element. The new option, according to ET, assumes that the goods will be delivered along a parallel route to INSTC. It will connect Mumbai to Bandar Abbas in Iran and then to Armenia, bypassing Azerbaijan, with which India has cool relations amid close ties with Turkey and Pakistan.

The Persian Gulf-Black Sea corridor fits well with India’s plans as it seeks additional routes to Europe, bypassing the Suez Canal and avoiding the negative consequences of a confrontation between Russia and the West.

According to political scientist and senior fellow at APRI Armenia Beniamin Poghosyan, any large-scale transit of goods that pass through the border between Russia and Europe looks “too risky for international logistics and insurance companies.”

Russia for the first time became the fifth largest trading partner of India, in the 2021-2022 financial year, Moscow occupied only 25th place, RIA Novosti reported earlier, citing data from the Indian Ministry of Trade and Industry. According to the results of the ten months of the 2022-2023 financial year, trade between the two countries amounted to $39.8 billion, and last year it reached $13.1 billion.

Last fall, the Indian Express reported that trade between Russia and India grew largely on the back of a sharp increase in India’s imports of Russian oil. India used to import less than 1% of its total oil from Russia, but now it is about 22% of its needs. Indian Express noted that in October Russia became the largest supplier of oil to India, overtaking Iraq and Saudi Arabia.