India, Russia add diamond sparkle to ties

New Delhi, March 12 : India's ties with Russia got a fresh sparkle Friday as Russian state monopoly Alrosa signed a clutch of agreements with Indian companies to supply diamonds worth about USD 1 billion.

Alrosa, which produces about a quarter of the world's rough diamonds, plans to supply about USD 1 billion worth of unpolished stones to India this year.

Alrosa signed three pacts with Diamond India Ltd and another two accords were signed with private companies, Ratilal Becharlal and Sons and Rosy Blue.

The three companies are expected to buy diamonds worth a total USD 490 million over the next three years, Alrosa spokesman Andrei Polyakov said.

India has proven expertise in processing rough diamonds. India processes about seven in every 10 of the world's diamonds.

The long-pending deal on diamonds is part of a new strategy to transform bilateral economic ties with India that have not matched the level of political trust and strategic ties the two countries have enjoyed since the Soviet era.

In a video conference with Indian businessmen, visiting Russian Prime Minister Vladimir Putin said he was determined to transform economic relations between India and Russia.

The two sides plan to scale up their current USD 7.5 billion bilateral trade to USD 20 billion by 2015.

Besides deals on diamonds, the two sides also signed two pacts on import of potash and mineral fertilizers. Russian state monopoly Gazprom also inked a protocol on cooperation with India's ONGC on oil exploration in Russia.

Putin vowed to boost banking cooperation with India through joint ventures. During the talks between Prime Minister Manmohan Singh and Putin, the two sides identified IT and telecom as future areas of economic cooperation.

"There is the political will on both sides, but we need support from the captains of industry," Putin said. "We should think about the future," he said.