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Friday, 23 January 2015

From Today's Papers - 23 Jan 2015

Parleys on to push defence deal

Ajay Banerjee

Tribune News Service
New Delhi, January 22

India clearly not satisfied with the US allowing just two military-use items under the much-touted Defence Trade and Technology Initiative (DTTI) is pushing for more as last-minute negotiations are on ahead of US President Barack Obama’s three-day (from January 25 to 27) visit to India.

The points-person of both sides, G Mohan Kumar, Secretary Department of Defence Production, and US nominee Frank Kendall, Under-secretary (Acquisition, Technology and Logistics) of Defence Department, met in New Delhi today.

“A few issues have been discussed and negotiations are on for collaboration and co-development of military equipment is being discussed,” said a source while adding that in international diplomacy it’s a two-way street.

The US is looking for a graduated baby-step approach to commence the DTTI while India is looking at a licenced-production-style of approach like it does with Russia, its Cold war (1945-1991) military ally. Tanks such as the T-90 and the Sukhoi-30-MKI — both Russian products — are produced in India while a nuclear powered submarine has been leased for ten years to India, to name a few.

The Pentagon (Ministry of Defence) has selected just two pieces of equipment out of the original list of 17 that can be made with India.

It’s for joint production of hand-held Unmanned Ariel Vehicles (UAVs) as well as specialised surveillance and intelligence gathering equipment for the C-130-J transport planes. The Indian Air Force has five of these planes in its fleet.

The UAV project is said to be the RQ-11 “Raven”, world’s most widely used UAV for tactical surveillance. The US government has rigid controls for larger UAVs to other countries, but for the ‘Raven’ the controls are not that strict.

The intelligence gathering equipment includes modules that allow C-130s to be quickly refitted for surveillance and as VIP transporters or hospitals.

Since the DTTI was launched in 2012, the US proposed 17 projects for collaboration. India has had reservations as the projects did not have scope for transfer of technology, like it enjoys with the Russians.
Pak bans JuD, Haqqani network
Islamabad, January 22
In a paradigm shift in its policy against terrorism, Pakistan has included Jamaat-ud-Dawa led by the 2008 Mumbai attack mastermind Hafiz Saeed and the dreaded Haqqani network in the list of proscribed organisations after the US mounted pressure on the country.

The step was taken after pressure heaped on the country to stop making a distinction between good and bad militants following a deadly Taliban attack on an Army-run school in Peshawar that killed 150 people, mostly children.

A government official said that the decision to ban JuD and several other groups was taken by the government several days ago and tasked the Interior Ministry to decide the modality to implement it.

The ministry followed by including the name of JuD and Falah-i-Insaniat Foundation (FIF), the two groups led by Saeed, in the list of banned organisations for their involvement in extremism and militancy. An official told Dawn newspaper that it was the demand of the USA to ban the Haqqani Network and JuD but the Pakistan government was using "delay tactics". The decision comes days ahead of US President Barack Obama's visit to India.
Army modernisation takes a bad hit
Since 2009-10, the Army’s capital budget is on a continuous decline hitting the lowest point in 2013-14 when the capital budget was only 18 per cent of the total allocation. This was spent mostly on the “committed liabilities” or existing purchases. It may be noted that as per Pentagon’s annual report to the US Congress, India’s annual defence budget is just one-third of that of China despite the tensions that remain along their shared border. The official annual defence budget of China in 2013 was $119.5 billion as against India's $39.2 billion
Modernisation of the Indian defence forces is a continuous process based on threat perception, operational challenges, technological changes and available sources. The process is based on a 15-year Long Term Integrated Perspective Plan (LTIPP), Five Year Services Capital Acquisition Plan (SCAP) and an Annual Acquisition Plan (AAP). Procurement of equipment and weapon systems is carried out as per the AAP in accordance with the Defence procurement procedure. The Defence Acquisition Council (DAC) cleared a total of 41 proposals since June last year. This was stated by Defence Minister Manohar Parrikar in a written statement in Rajya Sabha, during the winter session of Parliament.

Unfortunately, the Army’s plan to modernise its arsenal with the latest weaponry took a beating as the Finance Ministry recently cut the budget by almost about Rs 5,000 crore, leaving that much less money to make fresh purchases.

Army Chief Gen Dalbir Singh had on 13 January stated that the Army identified seven critical projects, which would be pursued for equipping the soldiers with advanced firepower and mobility. These critical projects which the Army Chief outlined are 814 artillery guns, 8000 third generation antitank missiles (from Israel), acquiring 197 helicopters for the Army, upgrading of tanks and BMP armoured vehicles, procurement of assault rifles, bullet proof jackets and helmets for the infantry soldiers and night vision devices for the infantry mechanised forces.

Out of these two projects, 814 artillery guns at a cost of Rs 15,750 crore and more than 8,000 third generation anti-tank missiles (from Israel) at a cost of Rs 3,700 crore were approved by the Defence Acquisition Council (DAC) headed by Defence Minister Parrikar. However, other five crucial projects are still under consideration of the Ministry of Defence (MoD). Both would have to be cleared by the Cabinet Committee on Security (CCS) before the procurement process starts because any project with more than Rs 1,000 crore budget needs CCS approval.
Since 2009-10, the Army’s capital budget is on a continuous decline hitting the lowest point in 2013-14 when the capital budget was only 18 per cent of the total allocation. This was spent mostly on the “committed liabilities” or existing purchases.

For 2014-15, the Army's additional demand (for grants) was not met but capital budget, meant for acquisition was reduced by about Rs 5,000 crore apparently because the money was transferred to revenue heads used for paying salary, pension and fuel bill. Other two services are also likely to have suffered from the budget cut and the modernization is likely to be delayed further, which will have adverse effect for the defence forces as well as for national security.

One of the reasons behind enhancement of revenue budget is the BJP-ruled NDA government’s plan to implement one-rank-one-pension (OROP) plan for ex-servicemen which is pending for the past three decades. The government accepted the OROP in principle and modalities of implementation are being worked out.

India cleared a bulk of defence projects worth $13 billion in a bid to boost the country's national defence preparedness, the Indian DAC said on 25 October 2014. The council finalised purchase of 12 upgraded Dornier surveillance aircraft with improved sensors from Hindustan Aeronautics Limited (HAL) at a cost of Rs 1,850 crore.

The DAC also decided to buy 362 infantry mechanised vehicles at a cost of Rs 662 crore. The decision to manufacture the submarines in the country is in line with Prime Minister Narendra Modi's ‘Make in India’ pitch.

The Indian defence budget stood at $11.8 billion in 2001. On February 17, 2014, the then Finance Minister P Chidambaram announced a 10 per cent increase in India's defence budget, taking it to $36.3 billion. In March 2014 China announced a 12.2 per cent increase in its defence budget, raising military spending to $132 billion.

It may be noted that as per Pentagon’s annual report to the US Congress, India’s annual defence budget is just one-third of that of China despite the tensions that remain along their shared border. The official annual defence budget of China in 2013 was $119.5 billion against India's $39.2 billion.

India announced plans to boost defence spending in 2014-15 by 12 per cent over the previous year, and further opened the domestic weapons industry to foreign investment. The Modi government had long called for a militarily strong India to counter potential threats from both its neighbours – China and Pakistan. In July 2014 the new Indian military budget was set at Rs 2.29 trillion ($38.35 billion) for 2014-15, and the foreign investment limit in the domestic defence industry was raised from 26 per cent to 49 per cent.

Defence expenditure, which was 2.24 per cent of the GDP in 1997-98, has come down to 1.79 per cent of GDP in 2014-15 and this gradual decline is against the modernization of defence forces. Hopefully, the next budget will be around 3 per cent of the GDP keeping in view the long-pending demand of defence modernization and threat perception from adversaries China and Pakistan.
Indian Army holds joint exercise with MNDF
The fifth joint military training exercise between the Indian Army and the Maldives National Defence Force (MNDF), EKUVERIN 2014, has concluded at Maafilaafushi, the Maldives, under the supervision of Col Mohamed Shahid, Commander Northern Area, MNDF.

A total of 45 marines from the MNDF took part in the exercise along with 45 personnel from the Indian Army, represented by 9th Battalion of the Madras Regiment (TRAVANCORE).

The bilateral annual exercise, which commenced in 2009 in Belgaum, is being held alternately in India and the Maldives.

The aim of the exercise is to enhance the military cooperation between the two countries, an official release said here on Thursday.

Brigadier Samir Salunke, Station Commander, Pangode Military Station; Brigadier General Zakariyya Mansoor, Director General, Department of Counter Terrorism, the Maldives; and Lieutenant Colonel Abdilla Ibrahim, Principal Director, Marine Corps, MNDF, visited the Marine Corps Training Centre at Maafilaafushi to review the exercise.

A number of training activities and exercises were conducted, which included training in counter insurgency and hostage rescue missions.

Colonel Mohammed Nazim, Defence Minister and Interim Health Minister of the Maldives, along with Capt. (IN) R.S. Sunil, Defence Advisory, High Commission of India to the Maldives, interacted with the troops.
In the Asian Arms Race, the Prize Is India
Barack Obama will be the guest of honor at India’s Republic Day parade on Jan. 26. The celebrations will feature child acrobats, marching bands, and colorful floats representing India’s states and territories. Also on display will be the country’s military hardware, much of which dates from the Soviet era. One of the topics of discussion when Obama meets with Prime Minister Narendra Modi will be how to upgrade India’s defense capabilities.

India, the world’s largest importer of weapons and defense systems, spent $5.6 billion in 2013, according to the Stockholm International Peace Research Institute. Modi wants to spend more: Since taking power in May, he’s signed off on $20 billion in arms procurement proposals, about double the amount spent in the prior fiscal year. Harsh Pant, a professor at the India Institute of King’s College London, estimates the costs of modernizing India’s weaponry will run to $130 billion over the next seven years. “A lot of Western arms exporters would be interested in that,” he says.

The U.S. displaced Russia as India’s top supplier of armaments in 2013—a major coup, considering that just four years earlier sales by American defense contractors to the country amounted to only $237 million. The Modi administration’s shopping list includes everything from heavy guns to submarines. Boeing is close to winning a $2.5 billion order for 22 Apache helicopters and 15 Chinook heavy-lift transport aircraft. During Obama’s visit, the two countries are expected to discuss plans to develop and produce weapons. “It will be more than a buyer-seller relationship,” says Tanvi Madan, an India specialist at the Brookings Institution.
India is counting on improved defense ties with the U.S. to help neutralize the threat from its northern neighbor. The People’s Liberation Army is in the midst of a substantial upgrade: Last March, China announced a more than 12 percent increase in the military budget for 2014, to almost $132 billion. The countries dispute their borders in the Himalayas and Kashmir. The Chinese are also longtime suppliers of weaponry to India’s bitter rival, Pakistan. “We face a coordinated China-Pakistan axis,” says retired Indian diplomat Gopalaswami Parthasarathy. (The U.S. also provides military aid and equipment to Pakistan, to support counterterrorism activities.)

American administrations spent the last decade rebuilding ties with India, with an eye to creating a military counterweight in the region. Those efforts may get a boost from Obama’s nomination of Ashton Carter for secretary of defense. As No. 2 at the Pentagon from 2011 to 2013, Carter helped oversee a program to increase technology transfers to India.

Imports account for more than two-thirds of India’s military purchases, by some estimates. That dependence leaves the country vulnerable in negotiations with foreign contractors, according to Bharat Karnad, a research professor at the Centre for Policy Research in New Delhi. “We are the foolish rich guy easily separated from his money,” he says.

India doesn’t have a strong record in designing and building its own sophisticated weaponry. On Jan. 17 the government held a ceremony in Bangalore to celebrate the completion of the Tejas light fighter aircraft, a project that had been in the works since 1983. The Defence Research and Development Organization, a government-run agency with a near-monopoly on military research, is “more notable for its self-promotion than the production of weapons,” according to a report from Brookings analysts Stephen Cohen and Michael O’Hanlon.

Modi sees increased military spending as a way to help jump-start his “Make in India” campaign. To help Indian defense contractors become more competitive, the government has eased limits on foreign investment in the local arms industry. It’s also leaning on foreign suppliers to share some of their valuable know-how with Indian firms. Dassault Aviation won a 2007 competition to supply the Indian air force with 126 Rafale fighter jets, but wrangling over whether the French company will guarantee timely delivery of the 108 planes to be assembled locally by state-owned Hindustan Aeronautics has delayed the contract’s award.

Expect the jousting for market share to continue. Russian Defense Minister Sergei Shoigu traveled to New Delhi on Jan. 21 to meet with representatives from the country’s Defence Ministry. The next day the Indians were due to host Frank Kendall, the U.S. under secretary of defense for acquisition, who’d been dispatched to the Indian capital to go over agenda items in preparation for Obama’s meeting.

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