While all the noise is around the arms deal, if signed, it could violate the sanctions by the US under Countering America's Adversaries Through Sanctions Act (CAATSA), which is initiated by the US Congress on purchases of arms from Russian Federation.
China too would be keeping a close watch on Putin's India visit because any large defence deal between New Delhi and another country is seen by the Chinese as having possible ramifications for Beijing.
Putin arrived in Delhi on Thursday evening and he and Modi were due to have dinner before the main talks on Friday. It wants to bolster ties with New Delhi to counter China s growing assertiveness, something that has also rattled India.
The other major contract that will be signed on Friday includes a $2.2-billion deal to procure four new warships for the Navy.
The first deal pertains to S-400 Triumf air defence missile systems that India would be purchasing from Russian Federation for $5 billion (Rs 3,691 crore at current price). Putin is on a two-day visit to India.
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All eyes will be on the defence agreements for the S-400 missile defence system +, frigates and assault rifles. The two will also discuss the USA sanctions against Russian Federation and cooperation on counter-terrorism. "Negotiation on S-400 air defence systems has been on for a long while and it is at a stage where it can be finalised", Sitharaman said last week.
"We urge all of our allies and partners to forgo transactions with Russian Federation that would trigger sanctions under CAATSA", a State Department Spokesperson told PTI when asked about India's plan to purchase multi-billion S-400 missile defence system from Russian Federation. Moscow is now expanding India's biggest nuclear power plant in Kudankulam. The two countries will hold the 19th annual bilateral summit and sign 20 bilateral agreements.
Also on the agenda is Russian training for Indian astronauts as New Delhi aims to launch its first crewed space mission in 2022. India is the world's biggest arms importer and is undergoing a $100-billion upgrade of its ageing hardware, much of it of Soviet vintage including MiG jets that have frequently crashed in the Indian countryside. "The administration is not only trying to navigate competing geopolitical interests but relatively stringent conditions imposed by a Congress determined to tie its hands on Russian Federation policy". But annual Russia-India trade has slipped below $10 billion since 2014, as Modi cultivated closer diplomatic and economic ties with Washington, while Russia has courted Pakistan and China.
Sources said the two leaders spent a lot of time in Sochi, and there is a broad understanding between them that this is "not a transactional relationship".
India wants to procure the long-range missile systems to tighten its air defence mechanism, particularly along the almost 4,000-kilometre-long Sino-India border. India is also expected to ink the $5 billion S-400 Triumf deal with Moscow.