Putin’s India visit: Can India-Russia bonhomie jeopardise the potential India-US trade deal? Experts debate

Russian President Vladimir Putin is in Delhi for the 23rd India-Russia Annual Summit. He arrived on the evening of December 4 on a two-day visit to India. Putin's last visit to India was in December 2021, so it is his first official trip to New Delhi since the Russia-Ukraine war began in February 2022.

Both countries are expected to strengthen their partnership in defence, aerospace, oil and energy. However, experts emphasise that Putin’s visit to India cannot be viewed as a routine state visit; it represents a major strategic and diplomatic development with the potential to shape global geopolitics.

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Global powers, especially the US and Europe, must be closely observing the bonhomie between India and Russia at a time when the road ahead of the Ukraine peace talks, backed by US President Donald Trump, looks hazy.

According to Reuters, Trump stated on Wednesday that the path ahead for Ukraine peace talks remains unclear after talks at the Kremlin between US special envoy Steve Witkoff and Trump adviser and son-in-law Jared Kushner, along with their Russian counterparts, concluded without any major breakthrough.

Can India-Russia bonhomie jeopardise the potential India-US trade deal?

As the Hindustan Times reported, the Russian President has said that India-Russia collaboration is focused on safeguarding their interests without harming others. However, it remains a fact that the US and Europe have been vocal about India's trade ties with Russia. Trump, in fact, has imposed a punitive tariff on India for purchasing Russian oil.

"The US must be watching the situation carefully. They will assess whether India is moving closer to the US or to Russia. The government is aware of this, so the noise around the issue will be carefully managed," said VK Vijayakumar, Chief Investment Strategist, Geojit Investments

Vijayakumar believes that if the proximity between India and Russia goes beyond a certain point, it may jeopardise a potential India-US trade deal.

"If the proximity between India and Russia goes beyond a certain point, yes, it may jeopardise a potential India-US trade deal. Too much alignment with Russia can hurt. And you certainly cannot afford to rub someone like Trump the wrong way," Vijayakumar said.

Experts say India's top priority must be a trade deal with the US—not with Russia.

"In the present context, India’s top priority should be securing a trade deal with the US. The trade deficit with the US is hurting the only vulnerable part of our economy right now. The Russia relationship can be managed—we mostly import defence equipment from Russia, and that deficit can be partly bridged through exports of pharmaceuticals, chemicals and other goods," said Vijayakumar.

Pranay Aggarwal, Director and CEO of Stoxkart, also believes India’s deepening ties with Russia may create some challenges for New Delhi in terms of securing a trade deal with the US.

"India’s deepening ties with Russia directly clash with the ongoing India-US bilateral trade agreement negotiations, as President Trump has explicitly tied the threatened 50% punitive tariffs on Indian exports to India’s purchases of Russian energy. This misalignment may delay or dilute any India–US trade agreement," said Aggarwal.

However, Aggarwal added that the overall relationship adds complexity, raising short-term risks but not derailing long-term US–India economic alignment.

Aggarwal believes that market sentiment could remain cautious, with export-oriented sectors facing pressure and foreign investors closely monitoring geopolitical signals. However, lower oil costs support India’s inflation and fiscal position, offering some offset.

On the other hand, some experts believe the India-Russia meeting may not jeopardise the broader India–US trade deal.

Ross Maxwell, Global Strategy Lead at VT Markets, believes while the US will be watching India–Russia meet with interest it may not derail the trade talks between New Delhi and Washington because India-Russia relationship is generally focused on defence and energy, whereas India–US trade relations are driven by technology, services, supply-chain diversification, and strategic initiatives to counter China’s influence.

"The US remains wary of India’s continued defence dependence on Russia and its purchase of discounted Russian crude following the Ukraine conflict. While these issues create diplomatic issues, they are unlikely to jeopardise the broader India–US trade deal on their own," Maxwell said.

"The US views India as a crucial partner in the Indo-Pacific, and commercial ties are too substantial for either side to allow disagreements with Moscow to impact the progress. Instead, negotiations are more likely to hinge on market-access concerns, digital trade, and tariffs," said Maxwell.

Overall, Maxwell believes the India–Russia relationship may produce occasional headline risks, but it is unlikely to significantly derail India–US trade prospects or materially impact long-term market sentiment, provided India continues to manage both partnerships pragmatically.

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Disclaimer: This story is for educational purposes only. The views and recommendations expressed are those of individual analysts or broking firms, not Mint. We advise investors to consult with certified experts before making any investment decisions, as market conditions can change rapidly and circumstances may vary.