Russia- Turkey Economic Cooperation- Concerns for Europe

Russia- Turkey Economic Cooperation- Relevance for UPSC Exam

GS Paper 2: International Relations- Bilateral, regional and global groupings and agreements involving India and/or affecting India’s interests.

Recently, Russia and Turkey agreed to enhance economic cooperation at a meeting held in the city of Sochi, Russia.
The US sanctioned Turkey in 2020 under its Countering American Adversaries Through Sanctions Act (CAATSA), for purchasing the S-400 air defence missile system from Moscow.
- India has also purchased this system but got an exception from the imposition of CAATSA by the US government.

Russia-Turkey had touched upon gas exports to Turkey. Turkey also agreed to partially pay for them in Russian currency, the ruble.
According to a Bloomberg report, five Turkish banks have adopted Russia’s Mir payments system for payment in rubles.
They also agreed to “meet one another’s expectations on the economy and energy”.
Other areas of cooperation mentioned in a Joint Press Statement released afterwards were transportation, commerce, agriculture, industry, finance, tourism and construction.

Russia-Ukraine War: It is concerning for Europe, especially at a time when the West has sought to reduce the scope of its economic relations with Russia over the ongoing war in Ukraine.
Financial System: Another source of concern could be Russia’s Mir payment system which has been adopted by 5 Turkish banks.
- With Visa and Mastercard suspending their operations in Russia since the invasion of Ukraine, Russian tourists in Turkey can now use their Mir card, effectively circumventing some Western sanctions.
Member of NATO: Closeness between Russia and Turkey raises concerns for NATO countries of which Turkey is a member.
- This is a serious concern, especially when Russia’s relationship with the Western and European countries is going through its low due to Russia-Ukraine war.
- It also holds the key to allowing Sweden and Finland admission into NATO, which the alliance might be eager to do given the events in Ukraine.
Turkey’s Importance for Europe: On the whole, Turkey is an important partner with the West and taking action against it could lead to a new range of issues cropping up for the West. For Example-
- Turkey’s instrumental role in dealing with the Syrian refugee crisis.
- Turkey hosted around 3.7 million Syrians as part of a deal with the EU, and “helped to stem the flow of migrants to Europe.