Eastern Economic Forum (EEF)- Relevance for UPSC Exam
General Studies II- Bilateral, Regional and Global Groupings and agreements involving India
Eastern Economic Forum-EEF: In News
Russia hosted the seventh Eastern Economic Forum- EEF Vladivostok. The four-day forum is a platform for entrepreneurs to expand their businesses into Russia’s Far East (RFE).
What is the Eastern Economic Forum(EEF)?
- The EEF was established in 2015 aiming to encourage foreign investments in the RFE to display:
- Economic potential
- Suitable business conditions and
- Investment opportunities in the region
- The agreements focus on infrastructure, transportation projects, mineral excavations, construction, industry and agriculture.
- With EEF, Russia is trying to attract the Asian economies in investing and developing the Far East.
- This year, the Forum aimed at connecting the Far East with the Asia-Pacific
Eastern Economic Forum: Aim
- The primary objective of the EEF is to increase the Foreign Direct Investments in the RFE.
- The region encompasses one-third of Russia’s territory and is rich with natural resources such as fish, oil, natural gas, wood, diamonds and other minerals.
- The sparse population living in the region is another factor for encouraging people to move and work in the Far East.
- The region’s riches and resources contribute to five percent of Russia’s GDP.
Eastern Economic Forum: Success
- Agreements signed at the EEF increased from 217 in 2017 to 380 agreements in 2021, worth 3.6 trillion roubles.
- As of 2022, almost 2,729 investment projects are being planned in the region.
Eastern Economic Forum: Major Participants
- China is the biggest investor in the region as it sees potential in promoting the Chinese Belt and Road Initiative and the Polar Sea Route in the RFE.
- China’s investments in the region account for 90% of the total investments.
- South Korea has invested in shipbuilding projects, manufacturing of electrical equipment, gas-liquefying plants, agricultural production and fisheries.
- Japan is another key trading partner. In 2017, its investments through 21 projects amounted to $16 billion.
Eastern Economic Forum: Russia’s response to China’s investment
- Russia has been welcoming Chinese investments since 2015; more now than ever due to the economic pressures caused by the war in Ukraine.
- The Trans-Siberian Railway has further helped Russia and China in advancing trade ties.
- The countries share a 4000-km-long border, which enables them to tap into each other’s resources with some infrastructural assistance.
- China is also looking to develop its Heilongjiang Province which connects with the RFE.
- Both nations have invested in a fund to develop connectivity between the cities of Blagoveshchensk and Heihe.
Eastern Economic Forum: India and Russia
- India seeks to expand its influence in the RFE.
- In 2019, India also offered a $1 billion line of credit to develop infrastructure in the region.
- During the forum, PM Modi expressed the country’s readiness in expanding trade, connectivity and investments in Russia.
- India is keen to deepen its cooperation in energy, pharmaceuticals, maritime connectivity, healthcare, tourism, the diamond industry and the Arctic.
Eastern Economic Forum: Strategic significance for Russia
- Gateway to Asia: The RFE is geographically placed at a strategic location; acting as a gateway into Asia.
- Negating the Ukrainian war impact: The Ukraine war is a worrying issue as it affects the economic growth of the country.
- Surviving sanctions: Although, the EEF is an annual gathering, the forum comes at an opportune time for Russia who is dealing with the impact of the sanctions.
- Supply chain resilience: The IPEF will also play a key role in building resilient supply chains.
Conclusion
- India understands the benefits of being involved in the development in the RFE but it also perceives the IPEF as a vital platform to strengthen its presence in the Indo-Pacific region.
- India’s participation in the forum will help in disengaging from supply chains that are dependent on China and will also make it a part of the global supply chain network.