This country is the missing piece in Russias multipolar dream
Moscow sees an opportunity in thawing India-China ties, but distrust, trade imbalances, and Western pressure complicate a RIC comeback
India is still in the aftermath of Operation Sindoor, in which it watched as China actively supported Pakistan with hardware, intelligence and command and control, and global narrative building. China and India have had military showdowns on their borders every few years.
The US-led NATO bloc is openly supporting Ukraine against Russia. As an adversary of the Americans, China has been tacitly backing Russia, while India, in its desire not to antagonize the US, has chosen a neutral stance on the Ukraine-Russia conflict. Russia is not exactly enthused about this.
China, and to a lesser extent Russia, are not happy with India becoming active in the Quad, a visibly anti-China grouping of India, the US, Japan, and Australia.
Much to India's chagrin, Russia continues to engage with Pakistan, which it considers geographically important to safeguard its interests in Central Asia, but also to remind India to not get too close with the US.
With India already the fourth-largest economy and among the fastest growing, both Russia and China have an interest in continuing to engage with it. If Russia can woo India away from the West, then Russia-India-China (RIC) can become an important bloc.
The combined GDP - adjusted for purchasing power parity - of China (19.6%), India (8.23%), and Russia (3.48%) currently amounts to 31.31%. The economic influence of BRICS nations exceeds that of the G7.
In 2025, RIC accounted for 37% of the global population. RIC is among the top 2025 global defense spenders after the US ($895 billion), with China ($266 billion), Russia ($126 billion), and India ($77 billion). In 2025, NATO member states spent $1.5 trillion on defense, which was 55% of global military expenditure. NATO is practically opposing only one country, Russia.
Against this backdrop, Russian Foreign Minister Sergey Lavrov reaffirmed in May Moscow's strong interest in reviving the Russia-India-China trilateral dialogue, citing improved India-China border ties. Russia accuses the West of trying to promote friction between India and China.
The RIC formation
RIC is an informal trilateral strategic grouping, originally conceptualized by Russia in the late 1990s as a counterbalance to Western dominance. It was the brainchild of former Russian Prime Minister Evgeny Primakov. Over the years, it has facilitated over 20 ministerial-level meetings, fostering cooperation in foreign policy, economics, & security among the three nations.
The grouping comprises the three largest Eurasian countries, which occupy over 19% of the global landmass. All three are nuclear powers & Russia and China are permanent members of the UN Security Council. All three countries are also members of BRICS, the G20, and the Shanghai Cooperation Organization.
RIC opposes unilateralism and supports the idea of a multipolar global governance model. It offers an alternative perspective on global issues, advocating for equity and reforms in global institutions. The grouping supports Eurasian integration through projects such as the International North-South Transport Corridor (INSTC) and the Eurasian Economic Union.
For India, the RIC format presents both opportunities and challenges. As India prioritizes strategic autonomy, it must balance opportunities in RIC and avoid being locked into any single camp, whether Western or non-Western.
The grouping faced a major setback and became dormant after the 2020 Galwan Valley clashes between India and China. The ongoing border disputes and lack of trust between India and China remain a challenge. India's growing ties with the West and its role in the Quad also complicate engagement with the RIC grouping. Russia's growing closeness with China, especially in the wake of the Ukraine conflict, might also raise concerns in India about the impartiality of the RIC platform.
Moscow has been reaching out to Beijing and New Delhi to ease the situation on the border. A thaw took place when Indian Prime Minister Narendra Modi and Chinese President Xi Jinping met on the sidelines of the 16th BRICS summit in Kazan, Russia in October 2024.
There have been 18 meetings of RIC foreign ministers. The last in-person meeting was held in Osaka on the sidelines of the G20 Summit in 2019. It was just the third such meeting in 12 years. The last ministerial-level RIC meeting was held online in November 2021.
In Osaka, the three leaders spoke on the international situation, both the challenges on the economic side and of peace and stability. They stressed the need to strengthen the international system led by the UN.
They also stressed the need to promote a multipolar world, a world in which there are many centers of influence and stability.
Terrorism as a global scourge was discussed. To promote trilateral cooperation, more specific areas needed to be evolved.
Challenges and advantages for strengthening RIC
India has become a key partner of the US in its Indo-Pacific Strategy, in an effort to address China's rising power. But the recent trade and tariff war may cast a negative shadow on the broader US-India strategic ties. It is no coincidence that the idea to push the RIC format has come amid these difficulties between the US and India.
Speaking at a security conference in Perm on May 29, Lavrov declared that "the time has come" to bring back the RIC mechanism, citing signs of deescalation in India-China border tensions. While trying to push multilateralism, each country has to defend their national interests.
Undoubtedly, Russia has a strong and genuine interest in strengthening RIC. But will strengthening it help New Delhi manage American tariffs? India's balance of payments with both RIC partners is also very unfavorable.
If RIC becomes an anti-US group, it will not be good for China either, as its economy largely depends on trade with the West. Can the scope of RIC be expanded, with foreign policy, economic, trade, and financial agencies of the three countries working more closely together, with greater give-and-take on minerals, rare-earths, microchips, and other technologies?
The growing Sino-Indian rivalry is expected to limit the range of issues in which members will be able to find consensus. Are RIC members ready for substantial military exercises between them without significant distrust? The answer is no.
India wants Russia to join the Indo-Pacific initiative to signal that it's not just a US-centric plan. India's focus on economic links with the Russian Far East and activation of a Chennai-Vladivostok maritime corridor may help persuade Russia that its interests in the Pacific are compatible with India's interest in diluting Chinese dominance in the Indo-Pacific; this also accords with Putin's concept of a Greater Eurasia.
Some analysts believe that by imposing harsh tariffs, the US is pushing New Delhi into Beijing's lap. Would RIC tend towards becoming an anti-American alliance? As India prioritizes strategic autonomy, it would prefer to balance opportunities in RIC and avoid being locked into any single camp.
The RIC countries, with important influence at international and regional levels and emerging market economies, need to further strengthen practical coordination on global and regional issues in the spirit of openness, solidarity, mutual understanding, and trust.
Notwithstanding the bilateral asymmetries, India and China have no choice but to engage bilaterally and multilaterally on a range of issues, even while firmly protecting their own interests.
China, India's leading trade partner, has a significant role indeed in driving the Indian economy and creating high-quality manufacturing jobs, which is of course a sensitive political issue. Chinese analysts have taken note of a recent shift in the Indian policy to attract more Chinese investment.
The Chinese economy is heavily dependent on the American market. Some understanding on trade between the US and China will emerge sooner rather than later. This will also have dynamics for RIC - and with America's global standing dipping a little, there could be a shift in the years ahead.
Russia's call to revive the RIC format reflects its strategic intent to bolster regional cooperation and counterbalance Western influence. It is in Russia's interests to be a facilitator in India-China relations. Lavrov has flagged this issue now, before Russian President Vladimir Putin's scheduled visit to India this year.
Lavrov believes that a strengthened RIC will give India greater leverage to resist Western pressure and maintain strategic autonomy.
Partnering with the two most populous countries gives Russia strength. The success of this trilateral initiative will depend on the political will of all three nations to navigate complex geopolitical dynamics and prioritize mutual interests.
Perhaps the time has come for Primakov's idea that the RIC triangle should become the symbol of the multipolar world and its core.
There are contradictions in the RIC format that the US will continue to exploit. But the same is true for many other groupings. For RIC to succeed, India is a key player, and its sensitivities about China have to be assuaged. China has to pull back on its support for Pakistan and stop using Pakistan's aerospace, nuclear, and missile build-up as leverage against India.
Taking part in RIC will be an opportunity for India to showcase its strategic autonomy to a global audience and send a message to Washington, which has repeatedly expressed its displeasure over India's close ties with Russia.
(RT.com)
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Yes, they played a role for equity markets across the globe, but for India it never posed a very big was a lot of stir created early on when the tariff wars started but soon it was realised that it was more of a bargaining stunt to get the stakeholders on the table to negotiate rather than a permanent change of structure in the global trade only point of concern is FII inflow into our equity markets. While our DIIs have been a major support, we can't ignore the validation that comes from FIIs and the quantum of their capital that ensures Indian equities are in Talks create a little uncertainty that results in institutional money being kept at bay, that's the only relevant headwind I think that equity in recent times have outperformed all the other EMs. This is a little ironical seeing how the main target of US trade wars is China, and their companies are facing an uphill battle in case tariffs are increased substantially.I would still refrain from considering the Chinese stock market as an investment destination. The main reason being the opaqueness of the country and the dictatorial laws that can be brought down by the government onto the private of giving double digit returns, the 3-yr performance of China based Mutual funds is still as low as 2%.For global diversification I think US tech stocks are a better bet. 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Q) What is your take on Q4 earnings from India Inc.? Any hits and misses which you tracked in the results? A) If we review Q4 earnings, aggregate profit after tax (PAT) for BSE 500 companies grew by 10% Y-o-Y and by 9% for the full FY25. There was sluggish domestic consumption and limited government spending in the first half due to elections and a volatile geo-political environment. This was a big step down from a stellar performance in FY24 that saw a 30% growth. BFSI sector stood out, contributing 1.84 % to the GDP and posted improved profits. Almost all stakeholders in the sector, MNCs, Private firms, Small & Midcap companies performed well. Metals, Telecom, Chemicals and Cement also supported positively to the growth. Certain sectors that showed sluggishness were PSUs, Industrials and IT. FY26 could see a turnaround, we expect the PAT growth to improve in most sectors on account of increase in demand and stability on the global trade front. US tariff wars could see a conclusion and that should bring a much needed respite and decrease volatility. We are bullish on BFSI which will continue to shine and have another good year, Agriculture and Defence is also looking to outshine in FY 26. Q) Nifty Bank hit a record high in June which suggests that there is a lot of interest in banking stocks. What is fueling rally in financials – is it the rate cut by RBI? A) As we discussed earlier, the BFSI sector has stood out in FY25 as an outperformer. Bank Nifty hit a record high in June following earnings growth numbers and a positive outlook for FY26. What was more positive is that we saw broad based growth across all verticals in BFSI. Banking, Wealth, Insurance across small , mid and large cap companies saw increase in earnings. If we look at number, on Y-o-Y basis, there was a 16% increase in PAT, 14% increase in Non-Interest Income, 13% increase in retail advance and 14% increase in MSME advances. These are very healthy numbers across the board. Recent rate cuts by RBI has definitely helped banks by providing excess liquidity but is not the only reason fuelling this rally. RBI rate cuts were as recent as February but we have seen good numbers coming in all through FY 25. Key factors supporting this rally are more on the fundamental side, most banks now have significant revenues coming in from non-interest activities such as wealth and insurance. They are high margin businesses with a huge growth potential. India still underserved and under penetrated when it comes to financial services; hence, there is a significant head room. Banks are sitting on credible data and are able to convert their existing CASA customers by cross selling and thus increasing their revenue per client. On the credit side, the growth cycle is strong and is expected to grow at 13-14% which should continue to support profits. NBFC's credit growth outpaced banks and will continue to do so in FY26. Q) Which sectors are likely to remain in limelight in the 2H2024? A) We are bullish on BFSI, with the recent RBI rate cut we can expect strong liquidity. There is scope for penetration for financial services, credit growth is growing strong. Supported with slight improvement in demand, we should see this sector giving another strong year. We are also taking positive calls on Defence fulled by governments efforts to have a self-sutainable defence industry and reduce the dependency on imports. The order pipeline here looks solid and defence production is projected to reach from Rs. 1.75 Trillion in FY25 to Rs. 3 Trillion in FY 29. The ministry of defence has already singed a record 193 contracts worth Rs. 2 Trillion. Out of these 177 contracts were handed to domestic companies, this shows the governments commitment of making India a defence manufacturer in their own right. Infrastructure and related sectors are also looking bullish, policy support is on their side particularly in the areas of renewable energy and power generation. Big infra companies will continue to benefit from India's growing infra need in Roads, Airports, Dams and Railways. Q) The tonality keeps changing from the US when it comes to 'Trade Talks'. Do you think it is still a relevant headwind for equity markets across the globe? A) In our view, US trade talks were never a major factor for equity markets in India. Yes, they played a role for equity markets across the globe, but for India it never posed a very big problem. There was a lot of stir created early on when the tariff wars started but soon it was realised that it was more of a bargaining stunt to get the stakeholders on the table to negotiate rather than a permanent change of structure in the global trade ecosystem. My only point of concern is FII inflow into our equity markets. While our DIIs have been a major support, we can't ignore the validation that comes from FIIs and the quantum of their capital that ensures Indian equities are in green. Trade Talks create a little uncertainty that results in institutional money being kept at bay, that's the only relevant headwind I think that matters. Q) China equity markets are up in double digits while we have underperformed most EM peers. Does it make a case for global diversification? A) China equity in recent times have outperformed all the other EMs. This is a little ironical seeing how the main target of US trade wars is China, and their companies are facing an uphill battle in case tariffs are increased substantially. I would still refrain from considering the Chinese stock market as an investment destination. The main reason being the opaqueness of the country and the dictatorial laws that can be brought down by the government onto the private sector. Inspite of giving double digit returns, the 3-yr performance of China based Mutual funds is still as low as 2%. For global diversification I think US tech stocks are a better bet. With AI changing the face of computing, I think the biggest beneficiaries will US companies who are the biggest stakeholders. Historically as well, US companies are at the center of every digital / computer revolution that has happened and I don't see why it should be any different now. Q) Which sector(s) is/are looking overheated and why? A) In Indian markets, I think one can be cautious while investing in Auto. FY25 saw a modest growth of 6.4% driven by passenger and two wheelers while the commercial vehicles growth remained flat. We have seen an impressive performance over last 24 months with increased sales across all verticals but going forward I think it's a little over heated. Also, the EV industry is giving the sector some headache, while most auto companies have installed EVE capacities, consumer acceptance of EV is not growing at a desirable pace. Adoption has been slow and due to EV related lack of Infra it is not expected to pick up very soon. We are also expecting a cyclical slowdown in sales, only silver lining are the SUV sales which continue to grow but other passenger vehicles along with two wheelers are looking bleak. ( Disclaimer : Recommendations, suggestions, views, and opinions given by experts are their own. These do not represent the views of the Economic Times)
