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					                                    EMBASSY OF INDIA
                                Economic & Commercial Wing
                                         Moscow


MOS/COM/202/1/2006
                                                                                      25/06/2011

             Economic and Commercial Report for the Russian Federation
                           for the Month of June, 2009

Executive Summary:


Russian economy has been hit hard by the global financial crisis. In the first six months of 2009,
Russia’s GDP contracted by 10.1 %. According to Russian Economic Development Ministry
forecast, Russia’s GDP in 2009 is likely to contract by 8-8.5%. The industrial production in Jume
dropped by about 12.1 % and the rate of unemployment stands at 8.3 %.
.


Economic and Financial Indicators

Table 1
GDP                                                       2008                         2009
at current prices                            2Q            3Q            4Q             1Q
Rubles billion                             10274.7      11 647.0      10 944.0        8482.8
USD billion                                 437.2        465.8         385.08         265.33
Sources: Central Bank of Russia

Table 2
INFLATION                                March 09       April 09       May 2009         June 2009
Consumer price index                       13.7          13.2            12.3             11.9
Core inflation (as % to Dec.                4.3           5.2            5.7              6.00
previous year)
Source: Central Bank of Russia


Table 3
FOREIGN TRADE              2007       Jan-        Oct.-       2008        Jan –        Ministry of
                                      March      Dec 08                   March       Economic
                                      2008                                 09         Development
                                                                                      Forecast for
                                                                                      2009, as on
                                                                                      1.7.09
Import [USD bln]         199.720      54.873     64.998       266.9       33.499         190.00

Export [USD bln]         352.568 108.463         97.270       468.1       56.907          274.00

Total (USD billion)   552.29   163.33     162.27    735.0                 90.406          464.00
 Sources: State Customs Committee of the Russian Federation
Table 4
TOP 5 IMPORTS (USD          2007   Jan-         Oct – Dec          2008         Jan – March
million.)                          March          2008                               09
                                   2008
Machinery, equipment      98069.5 27571.4       33309.2       136539.80          14132.4
and transport means
Chemical products and      26721.1    7188.8        8372.7        34125.20        5071.0
rubber
Food products and          26146.8    6870.1        9007.0        33267.30        5577.7
agricultural raw materials
Metal and metal products 14817.1       3288.2     3763.3     17419.50             1959.8
Textile and footwear       7874.4      2523.6     2663.5     10776.60             2320.1
Sources: State Customs Committee of   the Russian Federation

Table 5
TOP 5 IMPORT                2007          Jan-March      Oct –         2008         Jan –
DESTINATIONS                                2008          Dec                       March
(USD million.)                                           2008                       2009
Germany                  26558.728        6898.779     8679.97        34178.28     3006.43
China                    24405.310        7350.558     9047.65        34702.09     4659.73
Ukraine                  13325.395        3347.549     3219.52        16219.32     1703.81
Japan                    12714.743        3391.361     4459.26        18572.84     1758.39
USA                       9425.667        2542.538     3841.47        13745.10     1792.61
Sources: State Customs Committee of the   Russian Federation

Table 6
TOP 5 EXPORTS (USD            2007         Jan-       Oct – Dec        2008         Jan –
million.)                                  March        2008                        March
                                           2008                                     2009
Fuel and energy            216031.1       71979.6 61441.9           306349.70      34640.1
Metal and metal products    47621.4       12729.4  9851.2            52462.60      7206.8
Chemical products and       19561.8       5937.2   7176.8            28496.40      3708.2
rubber
Machinery, equipment and    17733.6     4164.9     5619.8            20545.90       2474.8
transport means
Wood, pulp and paper items 11928.8      2490.1     2416.7            11155.00       1721.7
Sources: State Customs Committee of the Russian Federation

Table 7
TOP 5 EXPORT        2004       2005         2006         2007             2008       Jan –
DESTINATIONS                                                                         March
(USD million.)                                                                       2009
Netherlands       15272.209 24607.877 35882.860 42869.536               56988.27    6398.81
Italy             12086.369 19052.426 25109.666 27520.670               41915.96    4755.77
Germany           13300.485 19735.834 24498.708 26346.225               33235.49    3006.43
Turkey                                               18379.236          27846.14    3754.84
China                       13048.455 15752.278
Belarus           11142.572
Ukraine           10768.518 12402.599 14984.536 16425.260               23252.73    1835.21
Sources: State Customs Committee of the Russian Federation
Table 8
FOREIGN TRADE WITH             2007       Jan-        Oct.- Dec      2008        Jan –
INDIA                                     March          08                      March
                                          2008                                    09
Import [USD million]         1309.527    367.104      441.371       1715.092    308.241

Export [USD million]         4011.383    871.482      1750.036      5231.050    1123.816

Total (USD million)         5320.91 1238.586        2191.41         6946.14     1432.057
Sources: State Customs Committee of the Russian Federation

Table 9
TOP 5 IMPORTS FROM INDIA          2007        Jan-       Oct. –       2008        Jan –
(USD million)                                March      Dec. 08                  March
                                              2008                                 09
Pharmaceuticals                 443.465      98.990  139.150         532.676     96.059
Coffee, tea and spices.         105.561      28.842  29.909         116.210      19.432
Nuclear reactors, boilers,       89.056      33.318  19.780         111.663      10.876
machinery and
mechanical appliances; parts
thereof.
Tobacco and its industrial       53.479 10.006       19.454          45.325      16.131
substitutes
Products of vegetables, fruit,   24.263    4.991     16.710          29.748      9.420
nuts or other parts of plants.
 Source: State Customs Committee of the Russian Federation

Table 10
TOP 5 EXPORTS TO INDIA (USD           2007      Jan-       Oct. –      2008       Jan –
million.)                                      March      Dec. 08                 March
                                                2008                               09
Fertilizers                        170.283     87.989   487.751      1080.056    204.882
Electrical machinery and           218.577     83.123   245.067       423.717    130.320
equipment and parts thereof;
sound recorders and reproducers,
television image and sound
recorders and reproducers, and
parts and accessories of such
articles.
Nuclear reactors, boilers,         532.318 138.174 195.079            559.063    122.721
machinery and mechanical
appliances; parts thereof.
Iron and steel                     538.932 134.231 120.837            441.469    72.607
Articles of iron or steel          83.761    19.846     65.395        102.176    29.709
Source: State Customs Committee of the Russian Federation

Table 11
RUBLES RATE (MAY 2009) June 01 June 30 Monthly Avg M-o-M Change
                                       Average

1 RUB / 1 USD                 30.74         31.29    31.01        1.75%
1 RUB / 1 EUR                 43.48         43.81    43.64        .75%
Source: Central Bank of Russia



Table12

           Goods and services output index by types of economic activities1)

                In per cent to the corresponding period of the previous year

                             2004           2005       2006      2007      2008       2009

       January                106,7          102,5       106,2   107,1      107,8       87,4
       February               109,1          104,3       104,5   105,6      110,7       88,1
        March                 108,0          104,8       108,1   106,4      108,9       87,6
      1 quarter               107,9          103,9       106,3   106,4      109,1       87,7
         April                107,1          104,2       107,4   106,1      109,6       85,1
         May                  107,6          102,9       111,5   106,7      107,3
         June                 109,5          105,7       108,1   108,9      104,1
      2 quarter               108,1          104,3       109,0   107,2      106,9
         July                 108,0          105,6       107,4   110,0      104,8
        August                109,5          104,7       108,2   105,2      105,5
      September               105,6          105,4       109,4   104,5      106,1
      3 quarter               107,7          105,2       108,4   106,5      105,5
        October               104,9          106,2       110,4   107,4      102,6
      November                108,0          108,3       109,6   106,5       95,8
      December                106,3          109,1       109,4   107,7       93,2
      4 quarter               106,4          107,9       109,8   107,2       97,1
        Annual                107,5          105,4       108,5   106,9      104,3

1) Estimated on the basis of data on change of physical volume of production in
agriculture, mining and quarrying, manufacturing, electricity, gas and water supply,
construction, transportation, wholesale and retail trade.
   The index is calculated on the basis of the annual average prices of the previous year.

Source “Federal State Statistics Service”

Table 13

                        COMMODITY STRUCTURE OF EXPORT
                          OF THE RUSSIAN FEDERATION
                                (at actual prices)

                                    1995 2000 2002 2003 2004 2005 2006 2007
                                                   USD billion
Export, total                       78.2   103     107   134     182    241    301    352
    of which:
 foodstuffs and agricultural raw     1.4    1.6    2.8    3.4    3.3    4.5     5.5    9.1
 materials (excluding textile)
 mineral products                   33.3   55.5   58.9   76.6    105    156     199    228
 chemical products, rubber           7.8    7.4    7.4    9.2   12.0   14.4    16.8   20.8
 leather raw materials,              0.3    0.3    0.3    0.3    0.4    0.3     0.4    0.3
 fur and articles there of
 wood, pulp-and-paper                4.4    4.5    4.9    5.6    7.0    8.3     9.5   12.3
 products
 textiles, textile articles          1.2    0.8    0.9    0.9    1.1    1.0     1.0    0.9
 and footwear
 metals, precious stones and        20.9   22.4   19.9   23.7   36.7   40.6    48.9   56.9
 articles there of
 machinery, equipment                8.0    9.1   10.1   12.0   14.1   13.5    17.4   19.7
 and transport means
 others                              1.0    1.6    1.6    1.9    2.1     2.5    3.1    4.4
                                                  As percentage of the total
Export, total                       100   100      100   100    100     100    100    100
   of which:
 foodstuffs and agricultural raw     1.8  1.6      2.6    2.5    1.8    1.9     1.8    2.6
 materials (excluding textile)
 mineral products                  42.5 53.8      55.2   57.3   57.8   64.8    65.9   64.7
 chemical products, rubber         10.0   7.2      6.9    6.9    6.6    6.0     5.6    5.9
 leather raw materials,              0.4  0.3      0.3    0.2    0.2    0.1     0.1    0.1
 fur and articles there of
 wood, pulp-and-paper                5.6  4.3      4.6    4.2    3.9    3.4     3.2    3.5
 products
 textiles, textile articles          1.5  0.8      0.8    0.7    0.6    0.4     0.3    0.3
 and footwear
 metals, precious stones and       26.7 21.7      18.7   17.8   20.2   16.8    16.3   16.1
 articles there of
 machinery, equipment              10.2   8.8      9.5    9.0    7.8    5.6     5.8    5.6
 and transport means
 others                              1.3  1.5      1.4    1.4    1.1    1.0     1.0    1.2
Source “Federal State Statistics Service”


Table 14
                        COMMODITY STRUCTURE OF IMPORTS
                           TO THE RUSSIAN FEDERATION
                                 (at actual prices)

                                   1995 2000 2002 2003 2004 2005 2006 2007
                                                   USD billion
Import, total                       46.7 33.9 46.2 57.3 75.6 98.7 138  200
    of which:
 foodstuffs and agricultural       13.2    7.4    10.4   12.0   13.9   17.4    21.6   27.6
raw materials (excluding
textile)
  mineral products                  3.0    2.1     1.7    2.2    3.0     3.0    3.3     4.7
 chemical products, rubber         5.1       6.1      7.7     9.6   12.0       16.3   21.8    27.5
 leather raw materials,            0.2       0.1      0.2     0.2    0.2        0.3    0.4     0.7
 fur and articles there of
 wood, pulp-and-paper              1.1       1.3      1.9     2.4     2.9       3.3    4.0     5.3
 products
 textiles, textile articles        2.6       2.0      2.4     2.8     3.3       3.6    5.5     8.6
 and footwear
 metals, precious stones           4.0       2.8      3.0     4.2     6.0       7.7   10.6    16.4
 and articles there of
 machinery, equipment             15.7      10.6     16.8    21.4   31.1       43.4   65.7    102
 and transport means
 others                            1.9       1.4      2.0    2.5    3.2      3.7       4.8     7.1
                                                     As percentage of the total
Import, total                      100      100      100    100     100     100       100     100
   of which:
 foodstuffs and agricultural      28.1      21.8     22.5    21.0   18.3       17.7   15.7    13.8
raw
 materials (excluding textile)
 mineral products                  6.4       6.3      3.7     3.8    4.0        3.1    2.4     2.3
 chemical products, rubber        10.9      18.0     16.7    16.8   15.8       16.5   15.8    13.8
 leather raw materials,            0.3       0.4      0.5     0.4    0.3        0.3    0.3     0.4
 fur and articles there of
 wood, pulp-and-paper              2.4       3.8      4.2     4.2     3.8       3.3    2.9     2.7
 products
 textiles, textile articles        5.7       5.9      5.3     4.8     4.3       3.7    4.0     4.3
 and footwear
 metals, precious stones           8.5       8.3      6.4     7.3     8.0       7.7    7.7     8.2
 and articles there of
 machinery, equipment             33.6      31.4     36.3    37.4   41.2       44.0   47.7    51.0
 and transport means
 others                            4.1       4.1      4.4     4.3     4.3       3.7    3.5
Source "Federal State Statistics Service"

Table 15

Foreign Investments in the Economy of Russia (Country-wise)

                                             2007                           2008
Countries with the Largest
Accumulated Investments in the                Year        1st       1st half      9          Year
Economy of Russia(USD million)                          quarter                 months

Investments - total                         220595       221045 242149          251279 264599

Cyprus                                       49593          50793    56765         54528     56902

Netherlands                                  39068          41060    44347         45152     46346

United Kingdom                               29235          27076    31365         31356     30811
Luxemburg                                    29161     29752    30518       34210    34402

Germany                                      11786     11789    13238       14881    17425

USA                                           8579      8207       9416     8503     8769

Ireland                                       7131      7813       8071     8017     9662

France                                        5919      6068       6675     8515     9542

Virginians (UK)                               4800      4521       5724     7470     8267

Japan                                         3100      3090       3332     3527     4077

Source: "Federal State Statistics Service"

Table 16

               Foreign Investments in the Economy of Russia (by types)

                                    2007                    2008

                                    Year  I quarter Ist half 9 months  Year
                                                   USD million
Investments, total                 120941    17255    46530     75792 103769
: of which:
Direct investments                  27797      5585    11080       19201     27027
  : of which:
 Contributions to capital           14794      4238     7033       11882     15883
    leasing                            82        16       66         135       168
   Credits received from foreign    11664      1135     3530        6272      9781
   co=owners of enterprises
                                     1257       196      451         912      1195
  other direct investments
                                     4194       123     1152        1296      1415
Portfolio investments
    : including:
 stocks and shares                   4057       107      948        1017      1126
                                      128        17      202         277       286
 Promissory securities
other investments                   88950     11547    34298       55295     75327
    : of which:
  trade credits                     14012      2759     7468       12671     16168
   other credits                    73765      8132    25819       41528     57895
    of which:
    terms within                     3429      1542     2817        4444      6617
    180 days
    terms                           70336      6590    23002       37084     51278
    over 180 days
   other                             1173       656     1011         1096     1264
                                              as percentage of the total
Investments, total                    100       100       100         100      100
      : of which:
direct investments                  23,0          32,4    23,8       25,3      26,0
: of which:
                                    12,2          24,6    15,1       15,7      15,3
 contributions to capital
  leasing                               0,1        0,1      0,1        0,2         0,2
 credits received from foreign          9,7        6,6      7,6        8,2         9,4
 co-owners of enterprises
                                        1,0        1,1      1,0        1,2         1,1
 other direct investments
                                        3,5        0,7      2,5        1,7         1,4
portfolio investments
      including:
  stocks and shares                     3,4        0,6      2,0        1,3         1,1
                                        0,1        0,1      0,4        0,4         0,3
  promissory securities
other investments                   73,5          66,9    73,7       73,0      72,6
      of which:
  trade credits                     11,6          16,0    16,0       16,7      15,6
  other credits                     61,0          47,1    55,5       54,8      55,8
      of which:
    terms within                      2,8          8,9      6,1        5,9         6,4
    180 days
    terms                           58,2          38,2    49,4       48,9      49,4
    over 180 days
 other                                0,9          3,8      2,2        1,5         1,2
Source “Federal State Statistics Service”

Table 17

  Countries with the Largest Accumulated Investments in the Economy of Russia
                                (the end of period)
                             2007                       2008

                                 Year         I quarter    I half     9 months           Year
                                                       USD million
Investments - total              220595         221045      242149        251279         264599
 Cyprus                           49593          50793       56765         54528          56902
 Netherlands                      39068          41060       44347         45152          46346
 Luxemburg                        29161          29752       30518         34210          34402
  United Kingdom                  29235          27076       31365         31356          30811
   Germany                        11786          11789       13238         14881          17425
  Ireland                          7131           7813        8071          8017           9662
   France                          5919           6068        6675          8515           9542
  USA                              8579           8207        9416          8503           8769
  Virginians (UK)                  4800           4521        5724          7470           8267
  Japan                            3100           3090        3332          3527           4077
                                                   as percentage of total
Investments - total                 100            100          100          100            100
   Cyprus                          22,5           23,0         23,4         21,7           21,5
  Netherlands                        17,7          18,6          18,3          18,0            17,5
  Luxemburg                          13,2          13,5          12,6          13,6            13,0
    United Kingdom                   13,3          12,2          12,9          12,5            11,6
  Germany                             5,3           5,3           5,5           5,9             6,6
   Ireland                            3,2           3,5           3,3           3,2             3,7
   France                             2,7           2,8           2,8           3,4             3,6
   USA                                3,9           3,7           3,9           3,4             3,3
     Virginians (UK)                  2,2           2,0           2,4           2,9             3,1
   Japan                              1,4           1,4           1,4           1,4             1,6
Source: "Federal State Statistics Service"

Table 18

International Reserves
( in USD million)

                                                           of which:
                        Official    foreign                   IMF                          other
                       reserves    currency     SDRs        reserve        gold           reserve
                                   reserves                position                       assets
      As on
                 412,591           365,382        3          1,701        16,621          28,883
   01.07.2009
As on 03.07.2009 409,100

Source: Central Bank of Russia

Table 19

External Debt of the Russian Federation as at the end of June 2009 (estimate)
(billions of US dollars)
                                                                December March               June
                                                                  2008       2009            2009
                                                                                          (estimate)
Total                                                                  483.5      450.8        475.1
General Government                                                      29.5       27.6         27.7
Federal Government                                                      28.2       26.4         26.4
New Russian Debt                                                        23.6       21.9         22.0
Multilateral creditors                                                   4.5        4.3          4.1
IBRD                                                                     3.8        3.6          3.5
Other                                                                    0.7        0.6          0.6
Other credits                                                            1.4        1.2          1.1
Foreign currency bonds                                                  17.3       16.1         16.3
Eurobonds, issued by public subscription and Eurobonds related           1.7        1.4          1.4
to GKO restructuring
Eurobonds related to London Club debt restructuring                     15.1       14.2        14.5
MinFin Foreign Currency Bonds (Series VII )                              0.4        0.4         0.4
OFZ                                                                      0.1        0.1         0.1
Other                                                                    0.3        0.3         0.3
Debt of the former USSR                                           4.6      4.4        4.4
Paris Club member countries                                       0.0      0.0        0.0
Debt owed to former socialist countries                           1.4      1.4        1.4
Other official creditors                                          1.9      1.9        1.9
MinFin Foreign Currency Bonds (Series III, IV, and V)             0.0      0.0        0.0
Other                                                             1.2      1.2        1.2
Local Government                                                  1.3      1.2        1.3
Loans                                                             1.1      1.0        1.1
Ruble denominated bonds                                           0.2      0.2        0.2
Monetary Authorities                                              3.3      2.5       10.8
Loans                                                             0.6      0.0        8.0
Currency and deposits                                             2.8      2.5        2.8
Banks (excluding equity capital)                                166.3    146.4      142.4
Other sectors (excluding equity capital)                        284.4    274.3      294.4
Debt liabilities to direct investors                             31.0     31.9       41.2
Loans                                                           236.1    225.8      233.0
Debt securities                                                   8.6      8.1        9.0
Financial leases                                                  5.8      5.9        6.0
Other                                                             2.9      2.6        5.2
Source: Central Bank of Russia




                                        Bilateral Visits


      . A delegation led by Mr. T. Nanda Kumar, Secretary(A &C), Ministry of Agriculture,
attended the       World Grain Forum      held at St. Petersburg from         6 th to 7th
June,2009.Other members of the delegation were:

       Dr.Joy Cheenath, Joint Secretary, Department of Food, Government of India
       Ms. Mamta Shankar, Director(Trade),Department of Agriculture & Cooperation,
       Government of India
       Mr. Abhay Kumar, Consul(Eco.Cons & Political), Consulate General of India, St.
       Petersburg.

        Mrs. Radhika Lokesh, Consul General of India in St. Petersburg, represented India
at the 13th Session of the St. Petersburg International Economic Forum, held from 4 th
to 6th June,2009.

       A 12-member team from the Chemicals and Allied Products Export Promotion
Council (CAPEXIL), Chennai, visited Moscow to participate in the Expostone 2009-
International Stone Fair at the All-Russia Exhibition Center, Pavilion 69, Moscow from
23rd to 26th June,2009.

      A delegation led by Shri E.Kasim, Chairman, the Kerala Cashew Development
Corporation Ltd, visited Moscow on 25th and 26th June, 2009, to explore prospects for
increasing cashew exports to Russia. Dr. K.A.Retheesh, Managing Director of the
Corporation , Dr. Sunitha Raju, Professor and Chairperson(International Collaboration
and Capacity Development), Indian Institute of Foreign Trade, New Delhi
 and Dr. Rakesh Mohan Joshi, Professor and Chairperson (Management Development
Programmes), also of Indian Institute of Foreign Trade, New Delhi, accompanied..

      .

				
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