On 20 March 2007, the oil and gas ministry of Kalmykia (a constituent republic of the Russian Federation) signed an agreement with Myanmar Oil and Gas Enterprise (MOGE) and Singapore's Silver Wave Energy for exploration and production of oil and gas from the B-2 onshore block, which borders India. According to reports quoting the Kalmykia republic's oil and gas minister, Boris Chedyrov, the participation will be "partial" with "only its specialists and drilling crews" taking part. Earlier in 2006, Russia's oil company Zarubezhneft and Myanmar's Energy Ministry signed a production-sharing contract for oil and gas exploration and production in Block M-8 of Mottama offshore fields in Southern Myanmar.

Russia's importance for Myanmar was demonstrated earlier this year when it vetoed the US-sponsored resolution on Myanmar in the UN Security Council. Russia's veto (along with that of China's) was welcomed by Myanmar's junta. On several occasions its leadership has thanked Russia for vetoing the resolution, which from Myanmar's viewpoint, marks another cornerstone in its relations with Russia.

China and India have been the focus of Myanmar's foreign relations with the attendant geostrategic implications for the region, and Myanmar's ties with Russia have not received much attention from either regional governments or the strategic community. However, a closer look is needed at the ties between Naypyidaw (Myanmar's new capital) and Moscow because these could change the regional geopolitical dynamics and have strategic and security implications.

Since the 1990s, Myanmar has been diversifying its foreign relations. Its geostrategic importance and rich natural resources, particularly oil and gas, has redefined its neighbour's policies towards Myanmar. Myanmar has taken advantage of these changes to strengthen its ties with its neighbours. For Myanmar, the significance of its ties with Russia derives from its hope for support from a powerful country in international forums and from its desire to balance its ties with regional powers. Russia too, hopes to get a 'foothold' in the region. While this serves each other's strategic interests, Russia's presence in the region will also impact on the regional environment.

Exchange of high-level visits between Myanmar and Russia have increased since the mid-1990s and after signing a joint declaration on the basic principles of bilateral relations in 2000, the two countries have strengthened their ties in the defence and energy areas. During the visit of Vice Chairman Sr. Gen. Maung Aye to Moscow in April 2006, the two sides signed agreements for cooperation in the oil sector, anti-drug trafficking, and protection of secret information.

Defence ties between the two sides have been growing since 1995 with Myanmar buying Russian military hardware and Russia providing training for Myanmar's technicians. In 2002, Myanmar reached a deal for the construction of a 10 MW nuclear test reactor in Myanmar. No information on this deal has been available since then. Again, in 2002, Myanmar purchased 10 MiG-29 jet fighters from Russia. According to unconfirmed reports over one thousand Myanmar technicians have been trained in Russia since 2001 and hundreds of Myanmar soldiers have undertaken courses on military science in Russia from 2003-04.

Myanmar has welcomed Russian investment and technology in agriculture and energy, and encouraged private sector cooperation between the two countries. Some areas where Russian business has shown interest include power-generation and telecommunication equipment, transportation and agricultural machinery, as also pharmaceuticals and tourism.

Myanmar's location in a region increasingly important in the geopolitical competition over strategic resources has drawn Russia into the region. Viewed from this strategic perspective, analysts believe that Russia's interest in Myanmar is to gain "greater access" to a country which is strategically located between China and India. Moscow also expects to expand its presence into Southeast Asia to watch China's activities more closely and "take advantage" of China and India's "rivalry" in Myanmar.

As one observer commented, "Myanmar appears to have become Russia's destination of choice for re-establishing a strategic foothold in the region." However, Russia is not likely to have a smooth ride. There are risks involved in this game. Analysts believe that Russia may be entering a "competition" that might adversely affect its relations with India and China.

Russia's moves in Southeast Asia seem compatible with Myanmar's own interests. Naypyidaw sees Russia as a "potential alternative" to pursue its balancing strategy. Myanmar has used the same strategy to engage India in countering the increasing presence of China in Myanmar. Russia's presence in the region may upset the strategic calculus of the regional powers considering the basic nature of the ties between Myanmar and Russia. However, whatever the implications of this relationship for the regional powers, the current ties between Myanmar and Russia are unlikely to be affected by such factors. Further cooperation between the two countries may be expected in the future.