Russian Direct Investment Fund (RDIF), a sovereign wealth fund, and the State Bank of India will jointly invest up to $2 billion to promote trade and economic co-operation projects, the Russian fund said in a statement on Monday.
The agreement, under which the two sides would invest up to $1 billion each, came as Russian President Vladimir Putin visited India on Monday.
RDIF said the two firms will work together to facilitate access to long-term capital in Russia and India and promote mutual investments between the two countries.
The firms will invest in infrastructure development and facilities to extract and process natural resources, it added.
Putin is on his first trip to India since he started a new Kremlin six-year term in May.
His trip is widely seen as a chance to reaffirm Russia’s interest in India, long a regional ally and now a partner in the BRICS (Brazil, Russia, India, China and South Africa) group of emerging market nations.
Russia is eyeing big defence deals from a country that plans to spend about $100 billion over the next 10 years to upgrade its largely Soviet-era military equipment.
Russian defence industry sources said the visit could produce deals on the sale of fighter jets and aircraft engines worth more than $7.5 billion.