Russian companies have been increasingly looking towards India: Kirill Dmitriev of RDIF
Notwithstanding decades old strong political and growing strategic partnership Indo-Russian trade and investment ties remain far below potential. But with now India seeking investments to boost infrastructure and boost economy, efforts are being made for a new India to engage with a new Russia with focus on energy, infrastructure, railways, agriculture and high technology sectors.
ET's Dipanjan Roy Chaudhury spoke with Kirill Dmitriev, CEO the Russian Direct Investment Fund (RDIF), member of BRICS Business Council, at Benaulim Goa. RDIF is investing $ 500 million to create Russia-India Investment Fund with an equal amount from National Investment and Infrastructure Fund. The Fund is expected to be announced at India-Russia annual Summit:
What brought you to India? Is that BRICS Summit only?
We are actively pursuing investment cooperation with leading Indian institutions. We have cooperation agreements with State Bank of India, India’s global integrated power company Tata Power and the leading infrastructure finance group IDFC.
On the side-lines of the Russian-Indian Summit in Goa,we will be signing an agreement on the establishment of the Russia-India Investment Fund together with the National Investment and Infrastructure Fund (NIIF) of India. Both sides will provide $500 million to the fund and we will focus on attractive investment opportunities in India and will support the development of Russian business here.
Russian companies have been increasingly looking towards India and many of them are already conducting business here. We’re working hard to support growth of investment and business activities.
At the same time we are looking at a number of promising dtransactions with Indian businessesfor investments in Russia and are ready to support them through joint investments under RDIF co-investment mechanism.
What is RDIF involvement in BRICS?
I am a member of the BRICS Business Council and would like to express my gratitude towards the Indian authorities for organising the summit. Last year, the BRICS countries set out a strategy of promoting mutual trade and investment as well as engaging with the business communities in their respective countries.
This week we saw thelaunch of the construction of the first New Development Bank (NDB) project in Russia and globally. This is animportant and strategic project- the hydro-electric plants in Karelia, Russia – an initiative which RDIFis leading in cooperation with the NDB, which was jointly set-up and co-owned by the BRICS nations.
How would you assess the on-going economic reforms in India? Do we move to the right direction?
We’ve been watching India’s economic progress with great interest and its climb up the WEF’s Global Competitiveness Rankings has been very exciting. More than 15 positions up within one year is an impressive result. We’re pleased to be playing some role in this and are looking forward to continuing and furthering our work with India.
What is the Russian Direct Investment Fund and how do you realize your co-investment mechanism?
RDIF is a $10 billion sovereign wealth fund that was established by the Russian government in 2011. We aim to promote inward investment into the Russian economy by identifying attractive investment opportunitiesand work with international partners to carry out projects and support companies around the world but primarily with focus on Russian business.
Over 5 years, we’ve invested around 850 billion roubles(more than 12 billion USD) and closed more than 30 deals with our partners. For every rouble we’ve invested we attracted almost 10 roubles from our international partners and banks.
In addition we’ve attracted over $27 billion of foreign capital into the Russian economy through long-term strategic partnerships. Leading sovereign wealth funds from Middle East, Asia and Europe are investing alongside RDIF in Russia and have earnedattractive returns in dollar terms. Moreover, other countries are creatingtheir own funds based on RDIF model. .
You have mentioned RDIF is investing alongside its partners and you have attracted almost ten times more the amount you invested yourself. How does it work?
We view ourselves as catalysts for investment and invest in leading, as well as promising, Russian companies