Over the last two years, India has signed deals worth over Rs 16,000 crore with US aviation suppliers, and deals totalling another Rs 16,000 crore are on the cards.
Money can’t buy me love, went the lyrics of a famous Beatles song in the Sixties, but all that seems so long ago and far away as India looks at cementing new alliances with the most powerful countries in the world, both for love and money, on the back of a fast-rising economy.
Clearly, none is more powerful these days than the US, despite its continuing inability to escape its own economic ‘chakravyuh’ and the fact that China, World Number Two, is snapping at its heels. But with the arrival of President Obama to India, where he is going to spend the best part of four days in Mumbai and Delhi, the air seems pregnant with the possibility of large defence deals, which Delhi hopes will persuade Washington to help consolidate India’s footprint not only in South Asia, but also expand it in areas like Afghanistan, South-East Asia and East Asia.
The fact that defence deals are likely to be signed at all during a major head of state’s visit — and several other large ones discussed — are a sign of the times. Usually in India, the political class and the bureaucracy have been disdainful of openly inking defence pacts, unwilling to publicly accept that quid pro quos are at the heart of its strategic partnerships.
But the times, clearly, are a-changing. Obama signed on to the Indo-US nuclear deal before he became President — the Bush administration at the time sought bi-partisan support for the unprecedented nuclear deal with India — and now needs support to revive his flagging economy. What better way than for Delhi to give him a thanksgiving gift that will help create thousands of jobs back home?
Obama’s Diwali will be delayed by two days — official talks and signatures on all agreements will take place in Delhi on November 7 — but it seems the postponed gratification is well worth it.
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On the cards is the largest-ever defence deal between India and the US, worth $3.5 billion or Rs 16,100 crores, for the acquisition of 10 C-17 Globemaster transport aircraft, that will replace the ageing fleet of Russian-made Ilyushin-76 transport aircraft. These are used to carry supplies as well as heavy equipment like tanks and helicopters, and are often used to also drop paratroopers as well as evacuate people in emergency situations.
Then there are the long-range maritime reconnaissance aircraft, the P-8I Poseidon, which will help both countries give teeth to their likely agreement on cooperation in the Indian Ocean. In its last Quadrennial Review, the US openly challenged India to reclaim the Indian Ocean as its own, by beefing up its maritime patrolling, protecting the sea lanes from the Straits of Hormuz to the Straits of Malacca and keeping them safe from pirates.
As many as eight P-8I have already been ordered for $2.1 billion, but India is now ordering four more. As the Chinese increase their dependence on the Indian Ocean to move their energy supplies and assert themselves in the South China Sea as well as in the Yellow Sea, the US is encouraging India to shoulder greater responsibility as a maritime power.
The Poseidons are likely to replace the Navy’s current fleet of eight Russian-made Tupolev-142M turboprops, five Ilyushin-38SD aircraft (which have been upgraded), a handful of Dornier-228 squadrons as well as 12 Israeli Heron and Searcher-II spy drones.
But these planes are more than just patrol aircraft. According to the literature, they are capable of “deadly anti-submarine and anti-surface warfare, armed as they will be with torpedoes, depth bombs and Harpoon missiles.” In other words, they could become the foundation of India’s secret dream of having a blue-water Navy.
But the biggest defence acquisition on the cards is the 126-fighter jet deal that will also likely find its way to the discussion table between India and the US. In fact, a task force on defence matters is likely to be set up between the two countries, to pursue “acquisitions with a strategic objective.”
Clearly, the biggest shift in India’s post-independence history in defence matters is these days taking place before our eyes. For the last 40-50 years, since the time Jawaharlal Nehru’s government moved closer to the Soviet Union — and Moscow began to invest heavily in India, from industry to defence — India leant heavily in favour of Russian defence technology and equipment, fired by the left-of-centre zeal of its intellectual classes.
But with the break-up of the Soviet Union 20 years ago and the new Russia going the way of the capitalist West with a vengeance, Delhi has finally arrived at the conclusion that it must ally much more closely with powerful players like the US rather than bank on the good old nostalgia of the “Hindi-Russi bhai-bhai” days.
That is why, over the last two years, according to a KPMG-American Chamber of Commerce study, three US companies have won a whopping 42 per cent of India's defence contracts. Boeing, Lockheed Martin and GE Aviation beat 13 companies from other countries to bag deals worth Rs 16,631 crores or $3.75 billion. Besides the P-8I Poseidon planes that Boeing will sell, Lockheed Martin sold several C-130 J transport planes, while GE bagged the contract for supplying engines to India’s light combat aircraft, Tejas, Harpoon anti-ship missiles as well as ultra light howitzers.
India knows it will have to pay more than top dollar for US defence equipment — Russian equipment is relatively cheaper — and that an ideological shift in favour of the US will mean that Indian defence platforms will be slowly weaned away from its adherence to the Russian military.
But over the last decade, as India has determinedly adopted free market norms, centre-right governments led by the BJP as well as the Congress have seen Washington as a closer friend than Moscow. The tipping point came with Bush’s zealous pursuit of the nuclear deal for India, with Russia following tamely in its wake. France, UK and the rest of Europe were left far behind in their clamour for India’s affections.
Indian officials will never admit it, but there’s a third reason: China. With Delhi and Beijing locked in an unspoken race for expanding their respective spheres of influence, America’s current antipathy vis-à-vis Beijing comes in handy for Delhi. In fact, analysts say, in the coming years, India, the US and Russia could even come together in an informal alliance against the world’s fastest rising power, China.
Still, Obama’s trip to India is not expected to be without its thorny spells. For a start, Delhi isn’t totally happy at Washington’s conspicuous lack of enthusiasm about announcing a Security Council permanent seat for India. On the subject of removing India from categories that demand end-user verification for certain highly sensitive technologies, Washington remains hesitant. It is also unwilling, at the time of going to press, to lift export controls on Indian entities associated with the Department of Atomic Energy, although it has agreed to remove Bharat Electronics and the DRDO from this Entities List. Space cooperation between the Indian Space Research Oraganisation and the US National Aeronautics and Space Administration is going well, but no dramatic initiatives have been announced.
It’s not as if Delhi isn’t also dogged by the shadows of its past. Malingering is a common trait in the corridors of South Block, and when this is compounded by an unwillingness to look ahead at a brave new world, insecurities are common. India’s unhappiness over US refusal to part with high-end communications technologies — that should normally come with sophisticated aircraft like the P-8I aircraft — is a function of its refusal to sign agreements like the Logistics Support Agreement (LSA), the Communication and Information Security Memorandum of Agreement (CISMOA) and the Basic Exchange and Cooperation Agreement for Geo-Spatial Cooperation (BECA).
The Americans are insisting that if India wants to be treated on a par with its allies like the UK, which entitles them to top-end defence equipment and technology, these pacts must be signed. But Indian officials remain hesitant about offering US officials the right to use their equipment on the ground to map sensitive terrain — as BECA would allow — or give access to high-end communications technologies, as CISMOA would pre-determine. The hackles on both sides today are a result of both India’s and America’s inability to look at the big picture. Barack Obama’s visit to India and his interactions with the Indian leadership will not only be an exercise in resolving these irritants but also how well both sides are able to paint the big picture of our times.