Wednesday, July 24, 2024

Arctic is key to Russia; India has made a headstart

The Arctic is crucial for the future of Russia’s economy, Aleksey Chekunkov, minister for the development of the Far East and the Arctic, told RT during the St. Petersburg International Economic Forum on Wednesday. He believes that infrastructure projects such as the Eastern Range, Northern Sea Route, and various ventures to extract and process the region’s natural resources, will benefit Russia for decades to come.

Chekunkov noted that the region is rich in unique precious metals, and is the source of nearly 90% of Russia’s natural gas. It will soon be home to floating natural gas liquefaction plants that will be able to produce 7 million tons of LNG per year. The region is also rich in oil, with the largest project, Rosneft’s Vostok Oil, expected to produce up to 100 million tons of crude annually by 2031-2032. Russia’s first floating nuclear power station is also located in the Arctic.

The Arctic and the Far East are a treasure trove. The Arctic is where the future economy of Russia is being built. What happens today in the Arctic and the Far East will serve many generations of Russians,” Chekunkov said.

He noted that the country is currently focused on further developing infrastructure in the region, particularly the Northern Sea Route.

It is the most dynamically developing sea transport corridor in the world today. Over the last seven years its freight turnover has grown more than eight times from 4 million tons to 34 million. By 2031 we can expect Russian cargo turnover alone to reach 200 million tons per year,” Chekunkov stated, noting that these volumes are comparable to what goes through the Suez Canal today. Apart from the route’s importance as a shorter link between Asia and Europe and its economic benefits, it also provides a safe alternative to other maritime freight passageways due to being distant from conflict zones, the minister noted.

Chekunkov noted that many of Russia’s foreign partners are expressing interest in joining the country in developing the Northern Sea Route, but warned that such partnerships need to be struck today, as in ten years it may be too late.

Those who are compelled to delay their cooperation with Russia for political reasons will regret it tomorrow. China, India and the Middle East, the UAE and Saudi Arabia are actively cooperating with us. These countries will be the beneficiaries of the Northern Sea Route development in the next ten years. Over the next ten years it will become a global transportation corridor where only those who can partner with us today will be able to go,” he stated.

The minister said that the Western sanctions imposed on Russia over the Ukraine conflict have had a positive impact on development of the Arctic. He likened the sanctions to a “disease in the human body, which provokes an immune reaction, and stressed that “the Russian economy is going through this immune reaction with dignity.

We haven’t even stumbled. The pace of new investments has increased. While we had 248 investment projects in 2021, the number reached 260 in 2022, while over 50 new businesses were launched. Some projects required changes… but companies were able to adjust. All in all, it made us stronger, it made us more self-sufficient, it gave the industry the push to build what we’ve been buying for ten years,” he stated.

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