NEW DELHI, Dec 21, (Agencies): Russia and India agreed on Tuesday a long-awaited contract to jointly develop fifth generation fighter aircraft and signed a deal to expand capacity at an Indian nuclear power plant.
The defence and nuclear deals were signed during a two-day visit to India by Russian President Dmitry Medvedev, who was expected to lobby hard for the former Cold War ally to stay loyal to Russian-made jets and reactors, rather than those offered by the West.
A statement said the two countries would work on a design project for the fighters and had agreed to build the third and fourth generating units for a nuclear power plant in India’s southern state of Tamil Nadu.
Russia has been India’s close economic and political partner since Soviet days, and monopolised India’s defence market for decades, but New Delhi wants to reduce its reliance on one country to reflect its growing clout on the world stage.

Leaders from Britain, the United States, France and China — along with Russia, the permanent members of the United Nations Security Council — have all visited India in the last six months, securing contracts worth a total of around $50 billion.
Medvedev, accompanied by a large delegation of business leaders, was holding talks with Prime Minister Manmohan Singh and ruling Congress party chief Sonia Gandhi on Tuesday in New Delhi, then visit the Taj Mahal in Agra and India’s financial capital Mumbai on Wednesday.
“It is well known that we want to diversify our basket of suppliers for our strategic areas. We will always have close ties with Russia but they are no longer the only game in town,” said a senior Indian government official, who declined to be named.
Russia sees India as a counterweight to China and a potential ally in Afghanistan. India’s growing ties with the United States, underscored by a landmark civil nuclear deal, has made Russia ill at ease.
New Delhi is likely to seek unequivocal backing from Russia for its ambition to secure a permanent seat on an enlarged UN Security Council, following statements of support from Paris and Washington in recent months.

Contract
Medvedev had been expected to secure a contract on jointly developing 250-300 fifth generation fighter aircraft over 10 years. The contract amount was unknown, but unofficially said to be around $35 billion.
Tuesday’s statement said the two sides had also signed a deal for Russia to supply missiles to the Indian army. No details were given on the size of the deal.
Russia is also keen to continue supplying nuclear technology and expertise to energy-hungry India as it plans to add 63,000 MW of nuclear power by 2032 to support its economic growth.
“Energy is one area where Russia will be the most important partner for India both in terms of conventional and non conventional energy.... Russians are one of our main suppliers of nuclear power plants,” said Lalit Mansingh, former Indian foreign secretary.
Behind the rhetoric of expanding ties with its fellow BRIC economy — the term used to group emerging powers Brazil, Russia, India and China — bilateral trade is eclipsed by Russia’s booming economic ties with the European Union and China.

The Kremlin said trade with India will total $10 billion this year, while official statistics show Russia’s trade with the European Union stood at $246 billion in the first 10 months of 2010, and trade with China was $47.5 billion in the same period.
India and Russia hope to boost bilateral trade to $20 billion within five years.
Medvedev on Tuesday threw his weight behind India’s quest for a permanent seat on the United Nations Security Council and secured agreements to deepen nuclear energy and defence cooperation.
New Delhi had been expected to seek backing from Russia during Medvedev’s visit for its ambition to secure a permanent seat on an enlarged UN Security Council, following statements of support from Washington and Paris in recent months.
“The Russian Federation supports India as a deserving and strong candidate for a permanent seat in an expanded UN Security Council,” a joint Russian-Indian statement said.
India and Russia agreed to boost annual bilateral trade to $20 billion by 2015.
Medvedev’s stop in Mumbai includes a visit to the Hindi-language movie industry Bollywood.
“(In Russia there is a) 24/7 broadcast of Indian movies. I think that exists only in India and Russia,” Medvedev told a joint news conference with Singh.

Visa
India and Russia also agreed Tuesday to liberalize their visa regimes as part of plans to ease travel by Indian businessmen to Russia. Indian business leaders have long complained about the difficulty of getting multiple entry visas to Russia, which makes them prefer trade with other destinations in Southeast Asia or China.
On Monday, India and Russia signed an agreement to double bilateral trade from the current $10 billion to $20 billion over the next five years.
Medvedev is the last in a stream of powerful world leaders to visit India this year, underscoring how a country once seen as a global underachiever has emerged as a sought after trading partner for the world’s flagging economies and an important regional power.
India was a key customer for Russian weapons during the Soviet era, purchasing military hardware worth billions of dollars. With India emerging as one of the largest buyers of fighter aircraft, tanks, submarines and other defense supplies in recent years, the leaders of France, Britain and the United States all worked to snare a part of that market during their visits here in recent months.
On Wednesday, Medvedev makes a brief stop in Agra to visit the Taj Mahal, the world renowned monument to love.

The Russian president, who was accompanied by several key ministers and a large business delegation, will then head for Mumbai, India’s financial and entertainment hub.
Medvedev was also expected to use his visit to lobby India to select Russian-made MiG-35s for a 12-billion-dollar contract for 126 fighter jets.
European and US aeronautical giants including Dassault Aviation, Boeing Co and Lockheed Martin Corp are also bidding for the tender.
Wary of China’s military modernisation drive, India is embarking on what global consultancy firm KPMG has described as “one of the largest procurement cycles in the world”.
Between now and 2016, India’s defence sector is expected to spend $112 billion on capital defence acquisitions, KPMG said in a recent report.
New Delhi and Moscow enjoy close ties that date back to the 1950s and analysts say Russia retains a competitive edge as an old ally even as India looks to build new strategic partnerships.
He made no specific mention of India’s arch-rival Pakistan, which Delhi accuses of harbouring militant groups like Lashkar-e-Taiba — blamed for the November 2008 attacks on Mumbai.
On Wednesday, Medvedev was scheduled to visit the Taj Mahal city of Agra before flying on to Mumbai.