DefInsights VOL.1 ISSUE 5 ~ OCTOBER 2017
A SUGOSHA PRESENTATION
EXCLUSIVE INTERVIEW
READY FOR FIT RESPONSE TO ENEMIES: IAF CHIEF AIR FORCE DAY SPECIAL
CONTENTS THE LEADERSHIP
INDIA-ORIGIN CEO KEY TO US DEFENCE TIES DEFENCE DIPLOMACY
INDIA-JAPAN STRATEGIC TIES: EMERGENCE OF A NEW WORLD ORDER
PROCUREMENT PROCESS
17
09
IDEAS FOR ACTION
14
BUREAUCRAT’S GUIDE TO SPEEDY COMBAT JET ACQUISITION
18
DEFENCE REFORMS: WHY IS IT CRITICAL TO BITE THE BULLET? INDUSTRY BUZZ
23
SAAB-ADANI ANNOUNCE INTENT TO BUILD GRIPEN IN INDIA
Editor’s Note
F-16 Vs Gripen: A tough choice before the nation The Indian Air Force’s need for the single-engine fighter jet in its inventory is gaining traction, with indications from Air Chief Marshal B. S. Dhanoa that the Request for Information (RFI) is likely to be out anytime soon - possibly before the end of this year. This eventuality has excited the military aviation market in India and obviously, it is an exciting time for all those involved in the process of selecting the winner of the next big combat aircraft deal that the world is witnessing. With the Strategic Partnership policy out a few months ago, the big-ticket single-engine combat aircraft acquisition would happen under this new guideline. No wonder that there is a sense of trepidation among the only two contenders for the huge pie from the Indian defence market. American giant Lockheed Martin and Swedish firm Saab have increased the pitch for bagging this lucrative deal with a positive campaign in India over the last year or so. Due to the single-engine requirement, the competition has now been restricted to just the F-16 Block 70 from Lockheed Martin and Gripen E from Saab. Under the Strategic Partnership route, the Indian government may go through the RFI for the single-engine combat planes, followed by an Expression of Interest (EOI) based on an assessment of the RFI responses from the two companies. Later, a Request for Proposals (the tender) would be issued to the two competing firms, before the winner is chosen based on technical and commercial evaluations. The process of selecting the foreign vendor and the Indian Strategic Partner could take place simultaneously. The Strategic Partnership policy provides the scope for the foreign vendor and the Indian Strategic Partner to form a joint venture or a special purpose vehicle or other means of tie-up when they submit their responses to the RFP. Lockheed Martin went ahead and signed a letter of intent with Tata Advanced Systems Limited in June this year at the Paris Air Show to build the F-16 Block 70 in India. Saab too announced its intent to collaborate with Adani Group at an event in New Delhi on September 1 (Read a report on page 23 in this edition) for its Gripen E. But, both the tie-ups have a caveat - the intent turns into reality if they bag the contract from India. India has been clear about what it wants from this possible deal. Among those factors that could influence the Indian decision, apart from the aircraft’s technical specifications and capabilities, are the industrial capability under the ‘Make in India’ initiative that the competing companies offer, the technology transfer that they are willing to do and share with the Indian partner, the export potential of the chosen aircraft to improve economies of scale, and the geopolitical strategic advantage that India gains from this deal. Industrial Capability and Technology Transfer Lockheed Martin: The offer is to shift its lone, functional production line at Fort Worth, Texas in the US lock, stock and barrel to India. This apart, many of the parts that go into the making of F-16 Block 70 would be made in India. This could mean the creation of jobs in the aerospace sector in India and the US. October 2017 | DefInsights | 3
For, the US suppliers of Lockheed Martin would love to keep some part of the business of making the F-16 for themselves. Lockheed Martin also boasts of having successfully set up production lines outside of the US in Belgium, The Netherlands, Turkey and South Korea. While all these production lines have closed after the orders ended, India would be the fifth production line of F-16 outside the US, if India decides so. What is not stated so openly is that Lockheed Martin has what is probably the world’s only operational fifth-generation fighter aircraft in F-22 Raptor. Along with F-35 Lightning II, India could gain from the fifth generation experience that Lockheed Marin has. Saab: The Swedish firm would be more than willing to set up a production base in India for the Gripen E and has made it clear that India could be its hub for meeting the requirements of the region. Saab Gripen has won a 36-plane order from Brazil, where it has begun a process for setting up a production line for Embraer. To enable the Brazilian facility to begin operations, Saab has taken Brazilian engineers to its production centre at Linköping (Sweden) to help them gain industrial skills on the Brazilian Gripens that Saab is building as part of their order. Saab promises to do the same for India what it is doing for Brazil. Going forward, Saab has also stated that it will help India to gain an aerospace capability for the future even as it upgrades the Gripen E with more capabilities and better performance, apart from providing all help in the development of the Advanced Medium Combat Aircraft. Strategic Advantage and Export Potential Lockheed Martin: The big picture is that Lockheed Martin is an American company and that nation has a lot to offer India as a ‘Major Defence Partner’. Being an advanced nation in defence technologies, US can arm India with the latest. With the kind of challenges that Indian faces from China, US is the only nation globally that can stand up to the Dragon. On the export orders front, Lockheed Martin has supplied over 4,500 F-16 variants globally, including to its home-customer. Nearly one-third of that order book has been for foreign customers. The US Air Force is still operating the F-16 and so do several other Lockheed Martin customers. All the F-16 customers would continue to operate the aircraft for decades more. If India decides on the F-16, it could take on the mantle of supplying the aircraft to Lockheed Martin’s global customers of Lockheed Martin. That would include India’s troublesome neighbour, Pakistan. This could mean a strategic advantage to India, if only it can choke the supplies to Pakistan’s F-16 fleet. Saab: This is the most independent choice that India could make. However, some of the equipment and systems on board Gripen E are American by make and technology. What’s more, if Saab Gripen is chosen, the Americans are still very happy. Thus, this also provides a double advantage of bringing two nations closer to India. The engine on Gripen E is from General Electric, which is a commonality it enjoys with the Indian-made ‘Tejas’ Light Combat Aircraft. Saab Gripen is currently operated by Czech, Hungarian, South African and Thai air forces, apart from the home-customer, Swedish air force. Brazil is the latest addition to the list of customers. If India makes the Gripen, it could be Saab’s partner nation when the aircraft is pitched to air forces in this part of the world. Parting Shot For now, the choice before the Indian government is too tough to make. However, the decision-makers will have to see the technical specifications of the two aircraft, their technological age and prowess, the systems on board and the aerospace advantage for the future. DefInsights will do an analysis of the technical specifications of the aircraft, its capabilities and the systems on board for the benefit of its readers in the coming editions. Till then, happy landings. N C Bipindra Editor 4 | DefInsights | October 2017
EXCLUSIVE INTERVIEW
IAF READY FOR FIT RESPONSE TO ENEMIES: AIR CHIEF MARSHAL DHANOA India’s military top brass is now completely engrossed in assessing and figuring out how to counter a two-front war scenario that is increasingly becoming a possibility. In this exclusive interview ahead of Air Force Day 2017, Indian Air Force chief Air Chief Marshal B. S. Dhanoa shares with DefInsights editor N. C. Bipindra the air force’s preparations to meet such an eventuality. Q. When the Indian Air Force celebrates its 100th year of operations a few years from now, what shape would the force will be in and what will be the size of its combat, rotorcraft, cargo, air defence and ISR capabilities? What is the scope of the emerging threats for which the IAF needs to and is preparing itself? What would it need in terms of equipment and manpower for the present threats and the future? What are its critical needs as of today? A. The IAF is planning its acquisitions according to a deliberate modernising schedule, designed to meet the evolving security requirements. The planned future acquisitions of IAF are aimed at improving the offensive and defensive capacity on both fronts. These are being factored into the Air Force and joint doctrines. The fighter aircraft strength is planned to be enhanced to 42 squadrons in a phased manner. Force multipliers are planned to be an integral part of the future conflict. Deployment strategies and training are also evolving to further enhance our capabilities. Towards this, infrastructure is being developed in all the sectors. In future, the IAF will have the adequate strategic reach to address security threats, peacetime military tasks, counter-insurgencies, anti-terrorist actions and international obligations as a major power. IAF is alive of the changing global and regional strategic environment. Q. What are IAF’s plans to meet the single-engine combat fleet needs and how does the IAF intend to go ahead with the induction plans for the same? How long does IAF think it would take it and the government to decide on the ‘Make in India’ single-engine combat platform?
A. The MoD has issued Chapter VII to Defence Procurement Procedure- 2016 (DPP-2016) for ‘Strategic Partnership’ model in which one segment is for Fighter Aircraft manufacturing. The aircraft produced through this route will meet the IAF’s requirement for Single Engine Fighter aircraft capability. The process will be as per DPP-2016 and timelines given in the DPP will be followed. The Expression of Interest (EoI) for the Single Engine Fighter aircraft is likely to be issued soon. Q. There is a projected need for twin-engine fighters. What are the plans for the Rafale jets? What does IAF think will be its future requirement of twin-engine combat planes, and the likely induction schedule? A. The IAF has a healthy balance between single engine and twin engine fighter aircraft. With the induction of the contracted Rafale aircraft, the number of twin-engine fighter aircraft will improve. The indigenous Advanced Medium Combat Aircraft (AMCA) is at Design and Development stage. Q. How does the IAF intend defending India’s airspace in the Eastern sector, Peninsular India, and the island territories, particularly the Andaman and Nicobar islands? What are the thoughts on likely deployment of combat capabilities in these sectors? A. IAF is well established on the path of modernisation to create a formidable, lethal and pervasive Air Defence cover over the entire country. As a first step, to enhance Air Surveillance capability, high serviceOctober 2017 | DefInsights | 5
EXCLUSIVE INTERVIEW
ability of the available sensors is being ensured along with replacement of the Legacy Radars with modern state-of-the-art Radars. The Low-Level coverage has been augmented by indigenous Rohini Radars which have replaced the legacy radars. Additional Low-Level Transportable Radars (LLTRs) and Man-Portable Short Range Radars/ Low-Level Light Weight Radars (LLLWRs) are being procured to bridge the low-level gap on Western and North Eastern borders, including mountainous terrain. To strengthen the primary radar cover pan India, cases for Medium Powered Radars (MPR) (Make), Aerostat Systems, High Powered Radars (HPRs) and Mountain Radars are being progressed. The existing Surface to Air Guided Weapon (SAGW) systems is being replaced with Long Range Surface to Air Missiles (LRSAMs) like S-400 and Medium Range Surface to Air Missiles (MRSAMs). The Short Range indigenous Akash Missile Systems have been successfully inducted in IAF and are replacing and augmenting the legacy SAGW systems. The induction of SPYDER Low-Level Quick Reaction Missile (LLQRM), Very Short Range Air Defence System (VSHORADS) and Close-In Weapon System (CIWS) will provide a lethal capability to tackle multiple targets at short ranges; while the Long and Medium Range SAMs would provide us Area and Offensive Defence capabilities by the SAGW systems. To further enhance our Air Defence capability, additional Airborne Warning and Control System (AWACS), Airborne Early Warning & Control (AEW&C) ac are being procured. To have integrated radar picture from the available sensors, Integrat6 | DefInsights | October 2017
ed Air Command and Control System (IACCS) has been operationalised which is a force multiplier. With operationalisation of additional IACCS Nodes to cover the remaining portion of the country’s airspace, a seamless real-time radar picture of the entire country including island territories would be available to decision-makers and operators alike, enhancing our decision-making and shortening the sensor-shooter time. Airborne platforms such as interceptor ac would play a greater role in ensuring required degree of AD cover. Our interceptor ac are undergoing Upgrade process such as the Mirage 2000 I/TI and MiG-29 Upgrade along with acquisition/ integration of longer-range air-to-air weapons. Q. What are the future joint air exercises with friendly foreign nations that are in the pipeline? A. FY 2017-18 is likely to witness joint air exercises with Russia, Humanitarian Assistance and Disaster Relief (HADR) exercise with Sri Lankan Air Force (SLAF) and Bangladesh Air Force (BAF), Joint Exercise with Israel Air Force and an exercise with the Royal Singapore Air Force (RSAF). Q. What progress has been made till date to ultimately have a Space Command as a tri-service formation? How long could this process take and what has been achieved till now? What has the Space Cell at the IDS HQ achieved in these years? A. The Integrated Space Cell (ISC) at HQ IDS coordinates joint space projects. IAF interacts with ISC regularly for effective utilization of all joint space assets.
EXCLUSIVE INTERVIEW A case is being processed for expanding Integrated Space Cell (ISC) at HQ IDS to Defence Space Agency (DSA). It will perform a role of Tri-Service Nodal Agency and will form a nucleus for future space command. Q. The IAF’s Sukhoi fleet has some critical issues regarding its maintenance and serviceability? How does the IAF intend to go about addressing this area of concern? A. All the critical issues that are identified from time to time are resolved proactively by engaging Original Equipment Manufacturer (OEM)/ HAL. Improvement in design, reliability etc, have been implemented/undertaken to improve serviceability, reliability and maintainability. Q. What are IAF’s preparations to put the Air Force assets to good use in a two-and-half-front war scenario? Could the IAF chief please tell us about the exercises conducted to envision such a scenario and work towards building capabilities? A. The IAF is prepared 24x7 for any threat and is ready for a befitting response to any contingency. The combat potential of any force can be judged by the overall assets available on its inventory. The IAF is undergoing a major modernisation drive which will enhance our capability significantly. We are working towards building up our fighter aircraft resources and combat support enablers like AWACS, FRA and ISTAR aircraft. IAF is capable of guarding the Nations skies and giving a befitting reply to any misadventures by adversaries. The IAF routinely conducts war games and air exercises throughout its area of responsibility. A pan IAF exercise was conducted in 2015 simulating this scenario. Q. Air Force is the pioneering force to allow women in combat roles. What are the current plans for the women fighter pilots going through training? How does the IAF plan to increase their numbers in the future? A. (a) Induction of women in flying branch of the IAF commenced in the year 1994. However, women got inducted only in transport and helicopter streams. Since the women pilots had coped well with transport and helicopter flying, it was felt that they would be able to undertake fighter flying also which is far more strenuous and demanding in nature. Hence, IAF decided to induct them into the fighter stream as a pilot project for five years. On June 18, 2016, three women officers of the IAF commissioned into the fighter stream of Indian Air Force for the first time. (b) The criteria for selection of women pilots for
fighter stream in IAF is same as that of male pilots. Selection is based on merit, recommendations of instructors and the willingness of the trainee to opt for fighters. Also, the training pattern is same as that of male pilots. Presently, no change in policy for selection of women pilots for fighters stream is envisaged. Therefore, their numbers in IAF in future will depend on the selection criteria. Q. Are there any gaps now in the training facilities and assets for fighter pilots? How do you intend to go about addressing this issue, considering the increased demands for effective training and preparation for the pilots to take on highly sophisticated platforms of the future? A. In the present training pattern, trainees fly the PC-7 Mk-II aircraft in Stage-I, Kiran Mk-I/ IA in Stage-II and the Hawk AJT in Stage-III. In addition to this, a pilot project has been taken up in which a limited number of trainees are being trained on PC-7 Mk-II aircraft in Stage-II. Training in modern Flight Simulators provides a realistic operational environment in which the crew can improve their basic and advanced flying skills. The current syllabi for flying training include embedded simulator training as well. Ground Training has also been revamped by making use of modern technology for enhanced teaching aids. Modernisation plans are already being exercised in all Training Establishments to upgrade classroom environment to match the modern assets being used for flying training. Computer Aided Learning System (CALS) with 3D graphics and animation are used extensively for training. The result of the present training pattern has been satisfactory and there are no gaps observed in the present training facilities and assets. October 2017 | DefInsights | 7
MISCELLANY
DAC nod to Navy for Sonars procurement Defence Minister Nirmala Sitharaman on September 27 chaired the Defence Acquisition Council (DAC) meeting for the first time since taking over the reins of the Defence Ministry. During the meeting, Nirmala Sitharaman reviewed the status of the Capital Acquisition Schemes as on date and directed that the schemes are to be meticulously monitored and brought to maturity within stipulated timelines. Towards this end, the minister stated that the DAC meetings are to be conducted once in a fortnight to enable speeding up the process of capability development of the armed forces. The DAC accorded ‘Acceptance of Necessity’ to the Indian Navy for procurement of upgraded Sonars for its destroyers and frigates through the ‘BUY INDIAN (IDDM)’ route at a cost of Rs. 200 crore.
These Sonars are designed, developed and manufactured indigenously by the Defence Research and Development Organisation (DRDO) and the Naval Physical and Oceanographic Laboratory, Kochi,
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DefInsights 8 | DefInsights | October 2017
and will provide a significant boost to the Navy’s anti-submarine warfare capabilities. The DAC additionally cleared procurement of missiles for replenishing the naval inventory.
DEFENCE DIPLOMACY
INDIA-JAPAN STRATEGIC TIES: EMERGENCE OF A NEW WORLD ORDER M id-September visit of the Japanese Prime Minister Shinzo Abe to India is significant in many ways. DPRK has set a new tune in the manner of which international relations are discussed. The pitch is queer, drums are louder, and a sense of disquiet prevails.
By Colonel K. V. Kuber
Katsuyuki Kawai, Special Advisor on Foreign Affairs to the Prime Minister of Japan was in India ahead of the visit of the Japanese PM, carrying the special message of Shinzo Abe: “I’m looking forward to the visit to India. Prime Minister Modi and I myself have built the strongest bond ever between India and Japan and I like to further deepen the relationship between the two countries in economy and security. I hope from the bottom of my heart that my forthcoming visit will mark a big leap for that cause.” There was hope, expectation, mutual trust, enormous confidence and an aroma of positivity in the message from Abe. India reciprocates in full measure, probably has done better in according the best possible welcome and the entire sequence of events only display the emergence of a new regional world order. It is regional in terms of the Indo-Pacific nature of the relationship and is global since it involves the might of the US as well. There are two aspects of Japan-India relationship, the high-speed railways, and the visit of the PM has provided impetus to this project. Also, Japanese technology could be used for Mumbai-Ahmedabad and for other lines under consideration. The second aspect impinging the relationship is Security and Defence Cooperation. The Malabar joint naval exercises among India, US and Japan conducted in July is a significant symbol of cooperation. Even at the Shangri La Dialogue in Singapore in June, Australian colleagues expressed their desire to participate in the Malabar exercises. Well, this participation is not too much in the distance and one can see it coming in 2018. The Defence agreement between Japan and India would be significant to both countries. The dastardly act of firing the ballistic missile over Japan on Aug 29, 2017, and the conduct of the sixth nuclear test (one still wonders if it was a fusion or a fission bomb), con-
sidered to be the most powerful test ever, unacceptable and unpardonable by Japan. The collaboration of weapons of mass destruction from North Korea is a de-stabilising factor in the region. Sanctions are necessary, as called by Japan, while both China and Russia have been preparing loop-holes for evading import of Coal and Iron Ore from DPRK. Japan conveyed three messages to US (i) a series of missile launches reiterates the position that now is not the time to have a dialogue with North Korea and is in fact the time for imposing sanctions (ii) Japanese value the stance of President Trump exhibited through words and actions with all options on the table, and (iii) to deal with North Korea action for action and not negotiation for sake of negotiation and dialogue for the sake of dialogue. It is not right to assume that Kim is becoming impatient and/or that North Korea is feeling cornered. Several people in Trump administration feel that Kim has the upper hand over the Chinese President Xi Jinping and (i) Kim is taking advantage of Xi’s desires of avoiding a turmoil in domestic and national front, ahead of the National Congress of the Chinese Communist Party in October; (ii) Chinese Communist Party has the aversion to the prospect of a unified Korea under the strong influence of the US, emerging at its doorstep. Aggravation of the North Korea crisis is enabling China’s desired outcomes to be realised by the US. US stance about naming China as a currency manipulator is a prime example. I am sceptical if Xi Jinping has lost his face by the recent missile launch conducted on the morning of the OBOR international forum opening ceremony in Beijing or by the recent nuclear test conducted on the opening day of the BRICS summit. The more provocative North Korea becomes the higher the value of China, more assertive role for China as a tamer of North Korea for the US. Both North Korea and China have around 200 ICBMs, US possesses none now, as it has abolished this type of missiles under the INF treaty. Japanese in any case do not possess any. Usually, potential regions, such as India and Pakistan in South Asia and Israel and Iran in October 2017 | DefInsights | 9
DEFENCE DIPLOMACY
the Middle East possess similar numbers of ICBMs, creating a situation of mutual deterrence. However, in the Far East, the balance of nuclear arsenals, including in the Korean peninsula, is extremely lopsided. Japan must face up to the fact that the security environment in and around it has moved to a decidedly different phase, compared with the previous situation. Time has come to seriously consider the Japan SDF possessing ICBM and cruise missiles to defend the peace and prosperity of Japan. The recently formed government of President Moon JaeIn may pursue a path of dialogue with North Korea. The five-year policy of the government in ROK has opened the Chesung industrial park and Mount Kang touring, but this will only subsidise their nuclear and missile development attempt, believes Kawai. Prime Minister Modi has a great relationship with President Trump and Shinzo Abe of Japan; US and India as like-minded partners must share values and strategic interest. Kawai said the decision making of the Obama administration is of a pyramid type, in contrast to that of the Trump administration which is like a multi-legged Octopus. Most of the officials in the inner circle directly report to the President and the situation in the White House is complex. 10 | DefInsights | October 2017
On the standoff at Doklam, Kawai said, Japan welcomes the understanding to disengage the two armies; a welcome path to diffuse the situation. Japan has been closely watching the situation there and is fully aware of the expansionist tendencies of China in the East China Sea and Seng Kaku islands. Strongly encouraged by the fact that the Indian government’s perseverance and resilient efforts, this border standoff has been calmed down. Japan will have a greater role to play as a standard bearer of the liberal International law and order. It is important for Japan to develop the capability to help themselves and formulate strategies on its own. They are no more waiting for advice from the US for any policy update. Kawai said that the first Japanese politician to use the word, “Indo-Pacific”, is Shinzo Abe, as it is his conviction that Japan’s interest in the Pacific is closely intertwined with India and will be heavily dependent on India and the Indian Ocean Region. Therefore, a strong India is in Japan’s interest and a strong Japan is in India’s interest. The bilateral relations between Japan and India is an indispensable cornerstone in the Indo-pacific region as well as for the world. The ever-growing relations between India and Japan will serve as a driving force for the world’s stability and prosperity.
DEFENCE DIPLOMACY
India too seeks to create strategic cooperation in addition to the Malabar exercises. War clouds are gathering strength in the area and we need to jointly investigate what is the implication and the impact both in terms of the ballistic missile over Hokkaido and the atomic capability whether it is fusion of fission and if these two were to be combined by N Korea to a strategic advantage then we need to ponder over this more. The Hwasong-14 fired on August 28, 2017, reached an altitude nine times of an International Space Station. The trajectory indicates a level of performance never seen in a North Korean missile. The projected reach is about 10,000 km while most US bases are within a striking range of 3,000 km. India opted for the Japanese technology in preference to alternate technologies available. As the two Prime Ministers lay the foundation stone for the Mumbai-Ahmedabad high-speed corridor, termed as the high-speed train for high-speed growth, to cover 548 km in less than three hours. PM Shinzo Abe committed to the “Make in India” initiative, “our industries are working with India to give a boost to manufacturing in India.” It is estimated that this project is expected to create 20,000 jobs in the construction phase itself. This is just the beginning, and other projects lined up are Chennai-Bangalore, as mentioned by In-
dia’s PM in his first visit to Japan, besides much more. This rail technology will also be effectively used for other programmes. Chennai-Ahmedabad and others in the Eastern corridors will just follow. Have the relations and to what extent, the initial tensions between US and China, has got altered by the Korean story? Propelled by China’s disregard to Intellectual Property Rights and the huge trade deficit falling in favour of China, was altering the entire approach of President Trump and has got deflected due to the significant issue of the Korean story and may impact for longer. The pressure exerted by Trump administration on economic issues in China may now be impacted and altered by the Korean Missile and Bomb story. These dynamics will change. A lot of the US economic policy will be shaped by this and the trans-pacific agreement has been dumped as would be the others. This is the time when Japan needs to make necessary changes to its constitution to bring its focus on Defence to be able to deliver to itself its own protection thus guaranteeing peace and security to its own people, as well as participate effectively in this emerging world order. In the last seven decades, India has been witness to the cold war era transgressing into to a October 2017 | DefInsights | 11
DEFENCE DIPLOMACY
post-cold-war, unipolar era and as many describe now as a multipolar era. What has not changed is the economic and geopolitical construct which ensured open sea lanes, rules-based engagements which ensured individuals and grouping of nations under China.
amond where democracies spanning across Pacific and the Indian Ocean need to work together.
The irony of this is that the challenges are those that have benefitted the most from this. The way China has benefitted from this and has been pushing the envelope is what concerns all of us. Two rouge states one pushing the militants into India and the other shooting missiles and exploding bombs over whoever they like or dislike, must propel democracies to unite with all at their command. While on the one hand, Kim has become a nuisance to China, the naughtier he gets, the more China will be needed by the International community of nations to help tame him, as a broker of peace.
This is the driving force for the India-Japan relations. India is at the pinnacle of growth and the growth story will explode as projects and programmes mature. It is for the Ministry of Defence to take the lead now to take the Strategic Partnerships policy to its logical conclusion with the single most aim of creating jobs. Nirmala Sitharaman has come at the most appropriate time to give this a gentle, yet a firm push, and continue her story of inclusive industrial growth in the Defence Sector. She is the Messiah, to ensure conclusion of all programmes by ensuring compliance to procedures and yet not become “Prisoner of Procedures.� She will do well to guide the procurement executive to see the spirit of the policy and not be in the confines of the letter.
One has witnessed, both in the Doklam crisis and in the BRICS summit that China can be engaged with resolve and work with friends to find amicable solutions. What they resisted successively at the UN, Chinese have opened in the BRICS summit on their own soil, to name terror. Democratic nations gave shared similar views and consensus and the concept of Di-
The technological advantage the nation gains from the high-speed train corridor can be effectively used in strategic sectors such as Defence. It is now the call of the hour to conclude the US2 to enable the Indian Navy to have the amphibious aircraft, a force-multiplier in the maritime domain. Synergy is the call of the hour to forge such relationships as was agreed in
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DEFENCE DIPLOMACY
the Defence Ministers meet on September 6. These include the institutionalised dialogues at ministerial levels, the interaction of the Japanese Self Defence forces with the Indian Army, Indian Navy and the IAF, increase in joint exercises, display a show of strength as suggested by the Japanese Defence Minister to also include the all-powerful state of art Japanese assets like the P-1 in the joint field exercises of 2018, besides inclusion of Anti-Submarine Warfare elements. India indeed has a capability to ramp up production of the BRAHMOS missiles and can supply to Japan, thereby mitigating the risks posed by North Korea to a large extent and share and build upon the Integrated Missile Development Programme with technologies at sub-system levels. India could also consider integrating the BRAHMOS into these joint exercises, as also considering the participation of Australia to create a strong teaming presence in the Indo-Pacific region. The relationship between Acquisition Technology and Logistics Agency (ALTA) and the Indian MoD (DDP) is getting strong with both government and industry participation, this needs to be further strengthened with a focus on identified products
with high technology content. Japanese Defence Minister Onodera has been more than forthcoming in strengthening the Defence relationships and this will do good for both countries. A new dawn with fresh outlook at countering terror, humanitarian assistance and a growing consensus to check rouge nations from spreading terror will need fresh relationships with like-minded nations. It is essential to engage China constructively in ensuring the success of peace in this region. Japan is now possibly India’s closest strategic partner in the world, as both sides converge in their strategic and economic outlook. Progress on the nuclear deal to take it to the next levels, investment in huge infrastructure and connectivity projects in the Asia Africa, all of them involving local content. In the case of the Japanese companies as stated by PM Abe, Mitsubishi, Toshiba, Hitachi and others will also help in design and development focusing on a co-development and co-production model. A new world order is emerging, with India at the centre stage. (The writer is an Indian Army veteran and CEO of Sugosha Advisory) October 2017 | DefInsights | 13
PROCUREMENT PROCESS
BUREAUCRAT’S GUIDE TO SPEEDY COMBAT JET ACQUISITION I
t may sound incredible but, according to official statistics, the number of fighter aircraft squadrons with the Indian Air Force (IAF) has gone up from 25 in 2014 to 33 in 2017. This has brought the IAF closer to the authorised strength of 42 squadrons, although the gap could widen again if induction of new aircraft does not keep pace with the inevitable de-induction of old ones.
By Amit Cowshish
It is becoming increasingly certain that this gap is sought to be bridged to a large extent by acquiring single-engine fighter aircraft, in addition to the HAL-built Light Combat Aircraft Tejas. Presently, Lockheed Martin and SAAB are the only two foreign manufacturers in the race in the single-engine aircraft category. Both have offered to make their products in India for which they have already signed agreements with the Tata Advanced Systems Limited (TASL) and the Adani Group, respectively. The Ministry of Defence (MoD) has also set the ball rolling by issuing the Request for Information (RFI) to these two companies. But this is as good as it gets, for RFI is just the first of the eleven stages through which every procurement programme has to pass before the deal is signed. Each of these stages carries within it the potential to derail the programme. Just to refresh memory, the programme for the acquisition of 126 Medium Multi-role Combat Aircraft (MMRCA) was aborted after more than three years of commercial negotiations. This incidentally is the penultimate stage before final approval is accorded by the competent financial authority to award the contract. Considering that acquisition of single-engine aircraft is susceptible to all the vulnerabilities of the existing procurement procedure, it is somewhat puzzling that MoD should have decided to adopt the strategic partnership (SP) model for this programme. Apart from the fact that any new model throws up numerous challenges when it is implemented for the first time, the success of the ragtag SP model is critically dependent on identification of the Indian
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companies which could be invited as prime vendors to manufacture the aircraft in India with the help of technology transfer from foreign manufacturers of the platforms chosen by the MoD. The process of identifying the Indian companies has not even begun. Even if it is assumed that this process will go through smoothly despite all odds, the pre-emptive tie-ups by the two main contenders in the single-engine aircraft programme with Indian companies have rendered this exercise redundant. It will be surprising if these agreements would permit Lockheed Martin and SAAB to tie-up with any other Indian company for manufacturing the aircraft in India. This poses a problem because under the SP model, the Indian partners, identified by the MoD as potential strategic partners, are required to approach the manufacturers of the platform, chosen by the MoD in a separate exercise, and enter into a legal agreement with the latter before submitting the bids. As things stand today, the two Indian companies with which Lockheed Martin and SAAB have entered into legal agreements have become their potential strategic partners by default. This should not bother the MoD. In fact, it should be welcomed for it saves MoD the trouble of having to identify the potential strategic partners and to convince the foreign vendors to get into production arrangements with them within the existing policy framework which allows FDI only up to 49 percent on the automatic route. It would be frivolous to question the wisdom of the already sealed tie-ups. The foreign companies would not have gone ahead unless they were absolutely certain that their Indian partners will be able to deliver what is expected of both of them under the SP model. More to the point, it should be a big relief for MoD that they have joined hands with the Indian companies of their choice without seeking any special dispensation in regard to control over their management.
PROCUREMENT PROCESS
As an added advantage, these tie-ups help in cutting short the time that will otherwise have to be given to the potential strategic partners – after they are identified by the MoD - to tie up with the foreign companies. However, in the event of the MoD not recognising the tie-ups already formed, this could end up creating legal difficulties if the main contenders are forced into new arrangements with other Indian companies. For sure, this problem may not arise if TASL and the Adani Group get selected as potential strategic partners through an unpredictable and laborious selection process. But what will be the point of it all? On the contrary, MoD can take a short route to issuing the Request for Proposal (RFP) if the validity of the tie-ups is acknowledged by it. This also opens up the possibility of categorising the acquisition programme under the ‘Buy and Make (Indian)’ category or the time-tested ‘Buy and Make’ category. In essence, the difference between the two is this: under the former category the RFP is issued to only Indian vendors, and under the latter category it is issued to foreign vendors. The same end-results
can be achieved under either of these categories. Of the two, however, the ‘Buy and Make’ category seems more appropriate in the present case because the success of the entire project hinges on the conduct of the foreign manufacturer, be it with regard to transfer of technology, quality assurance, maintenance, and the like, for which it will be jointly responsible under the terms of the contract along with the Indian partner. It is difficult to visualise any objective that cannot be achieved under the ‘Buy and Make’ category but which can be achieved only under the ‘Buy and Make (Indian)’ category or by adopting the SP model for this acquisition programme. In any case, the tricky part will be the drafting of the RFP in a way that serves the objective of the programme, which should primarily be to ensure that the Indian company is not only able to manufacture and maintain the aircraft but is also in a position to undertake its life extension/up-gradation in future without being unduly dependent on the foreign manufacturer or being constrained by IPR issues. October 2017 | DefInsights | 15
PROCUREMENT PROCESS
To illustrate, rather than specifying the scope, range and depth of technology required to be transferred by the foreign manufacturer, the RFP could simply seek information as regards the technologies and capabilities that the manufacturer will not be able to transfer as also the reasons for being unable to do so. The selection of the foreign company should be linked to the MoD being satisfied by the reasons proffered, and assessment as to whether the IAF can live with such denial of technology or capability, and what impact it will have on manufacturing/life-extension/up-gradation of the platform by the Indian company in future. It should also be possible to compress the time required for carrying out the trials if the platforms are trial-evaluated only in respect of the parameters which have been added to it by the manufacturers af16 | DefInsights | October 2017
ter these platforms were last evaluated in the context of the now-aborted programme for the acquisition of 126 Medium Multi-role aircraft, provided it is technically feasible to do so. All these measures will help MoD leapfrog to the commercial negotiation stage and, with some bold decision-making, even to the contract signing stage much before the end of the next financial year, which is effectively all the time that is available before the next general elections. It goes without saying that all this trouble will be worth the while only if there is a reasonable certainty of the programme not being stymied by the funds-crunch. (The writer is a former Financial Advisor (Acquisition) at India’s Ministry of Defence. The article was first published by New Delhi-based IDSA)
THE LEADERSHIP
INDIA-ORIGIN CEO KEY TO US DEFENCE TIES
Several global aerospace and defence companies today boast of having an Indian or an Indian-origin executive to head their operations in India. But one of the first people with Indian roots to head a global aerospace and defence giant in India was Vivek Lall. When Vivek Lall was in his mid-thirties, he headed Boeing’s India operations in the defence sector and he is one man, who is being credited with having brought back focus on India-US defence cooperation and the present aircraft carrier technology cooperation under the Defense Technology and Trade Initiative. Dr Vivek Lall is currently well established in the Asia-Pacific and US defence and political establishments as the “most influential Asian American in US defence industry.” In the past decade, from P8I to Harpoon to C-17 to Apache to Chinook to EMALS now, Dr Lall has been instrumental in getting breakthroughs for global US companies and the US establishment in the Indian military platforms and equipment market.
Even today, Dr Lall is recalled by the establishments in the US and India as someone who played a key role in the two nations’ bilateral defence relations. While he headed the Boeing Defense in India, the global aerospace company managed to bag orders worth $8 billion, including those for C-17 heavy-lift aircraft for the Indian Air Force (IAF), P-8I multi-mission maritime aircraft for the Indian Navy and Harpoon missiles for both the IAF and the Navy. San Diego-based General Atomics Electromagnetics had in 2014 hired Indian-origin Vivek Lall as its Chief Executive for U.S. and International Customer Strategic Development. Lall completed his Masters in Aeronautical Engineering from Embry-Riddle Aeronautical University in Florida and later completed his PhD in Aerospace Science from Wichita State University in Kansas. Later, he earned his MBA from Seattle.
In fact, senior officials in the Japanese establishment have also termed him as one of the most influential guys in the US defence vertical. He can speak five languages, including French, German and Swahili and is a reluctant, almost reticent, conversationalist.
Dr Lall has previously worked with Canada’s National Aeronautical Establishment and at Raytheon. He later joined Boeing in 1996, and in just over 10 years, in May 2007 precisely, Lall was appointed as Vice President and Country Head for Boeing Defense Space and Security in India.
During his stint in India before shifting to the US, Dr Lall was chairman of the Indo-American Strategic Dialogue. He is also an Adviser to the United Nations affiliates on Cyber Security and Broadband issues.
Currently, Lall is pursuing General Atomics’ nuclear business for India, apart from the company’s interest in helping India with its future aircraft carrier technology, particularly the Electro-Magnetic Aircraft Launching System or EMALS. October 2017 | DefInsights | 17
IDEAS FOR ACTION
DEFENCE REFORMS: WHY IS IT CRITICAL TO BITE THE BULLET? O By Vivek Chadha
n August 30, 2017, the then Defence Minister, Arun Jaitley announced a series of defence reforms which will result in the ‘redeployment and restructuring of approximately 57,000 posts of officers/JCOs/ORs and civilians’. The reforms are aimed at ‘enhancing Combat Capability & Rebalancing Defence Expenditure of the armed forces with an aim to increase the “teeth to tail ratio”.’ Initial approval has been given for 65 of a total of 99 recommendations pertaining to the Indian Army. This will begin with the closure of 39 military farms in a time-bound manner. The reforms are expected to be completed by December 31, 2019. The political initiative to undertake the reforms, including the initial set of measures that have been announced, is a welcome move. Both enhanced combat capability and efficiency, intended to be achieved through the ongoing reforms, are worthy objectives. This policy brief will attempt to suggest critical policy imperatives that must continue to act as guidelines for the ongoing attempt at defence reforms through the process that has been described as a major change if it is indeed envisaged as the first such exercise after independence. Military change is defined in a number of ways. In view of the conventional (state-on-state) and sub-conventional (counterinsurgency and terrorism) challenges faced by India, it may be best defined as “an attempt at developing a significantly more effective approach to existing or future military challenges.” India’s past experiences suggest that changes often witnessed in the conventional domain have been strategic, aimed at creating major shifts in the military’s approach to warfighting. These have also manifested in the organisational domain in the form of large-scale structural realignments. An example of a change in the approach to warfighting was the attempt at compellence during the mid-eighties after having followed a doctrine of offensive defence in the seventies. More recently, the strategy of ‘Cold Start’ or ‘Limited Pre-Emptive Offensive’ also qualifies as such a change. Change in the organizational domain is best
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illustrated by the structural changes that took place immediately after the failure in the 1962 India-China war. Some of the major steps initiated in this regard included an increase in the size of the army from 5,50,000 to 8,25,000 as well as the raising of six mountain divisions and a new command headquarter. The changes based on the 1975 Krishna Rao Committee report, which led to the mechanisation of the army along with strategic reorientation, is another example that comes to mind. In the sub-conventional domain, the raising of Rashtriya Rifles (RR) is an important and relatively recent example of organisational change. Each of these examples represents a major military change. However, that does not imply that all these changes were successful innovative steps or even an example of evolutionary adaptation. The factors that ultimately determined the success or failure of each of these initiatives were: an accurate long-term strategic assessment that became the basis for the change; support from the political establishment to steer the change; a visionary and committed military leadership which provided professional advice; strong institutional structures that enabled implementation of the reforms; and finally, efficient follow-up action undertaken by both military commanders and successive governments. In this regard, the changes undertaken post-1962 fell short of transforming institutions that had come up short, prior to, and during the conduct of the war. A constrained national strategic vision and weak institutional structures were responsible for the failure to improve intelligence collection, collation and analysis, take up systematic capability development, and create joint training, planning and fighting institutions. To give one example, the Joint Intelligence Committee continued to remain ineffective despite being shifted to the Cabinet Secretariat. The manner in which the plan for raising additional force levels was made indicated inadequate due diligence in assessing threats and capability development.
IDEAS FOR ACTION
This was echoed in various analyses, including Y. B. Chavan’s order to undertake a more systematic assessment, Palit’s assessment of the process as the then Director of Military Operations, and observations of General Taylor, Chairman of U.S. Joint Chief of Staff. A mere attempt at plugging shortfalls and increasing numbers did not offset the strategic disadvantage that India was plagued by for decades. Further, India failed to build infrastructure that could support a cohesive defensive battle, and logistic establishments to facilitate faster buildup. A quick reaction capability through better heli-lift resources remained a weakness decades after the war. That the poor state of infrastructure remained a costly error of strategic foresight and implementation was acknowledged by A.K. Antony on the floor of Parliament as late as 2013. These limitations have continued, occasionally being exposed when the reality of the challenge emerged in all its manifestations in the face of China’s military aggressiveness at Depsang, Chumar and more recently Doklam, making change imperative. Conversely, the reforms after 1975 that revolutionised India’s war-waging potential, particularly in the Punjab and Rajasthan theatres, did give India a perceptible strategic edge over Pakistan in the mid-eighties. This example suggests the successful contribution of all five factors listed above. The same was also achieved through the raising, orientation, training, deployment and employment of the RR in Jammu and Kashmir (J&K). Measures to enhance the combat effectiveness of the army must flow from a clear security intention outlined by the government. This, in turn, should em-
anate from India’s threat perception or in the event of no clear and obvious threats, which would be the case without of area contingencies, a capability that the country must possess to deter or neutralise any threat that emerges in the future. In our case, there are clearly discernible security threats and challenges that continue to adversely affect India’s security. These are a result of unresolved borders and continuing inimical actions by adversaries. Given the history of four major wars fought by India and its adversaries, the country has no option but to deter a future war and, in case deterrence fails, remain prepared to defend its sovereignty and territorial integrity. In addition, the security forces must build and retain the capability of protecting India’s core national interests beyond its borders. These include, inter alia, the safety of Indians working in regions like West Asia; protection of economic and energy supply lines and assets; contribution to international responsibilities like United Nations (UN) peacekeeping and anti-piracy operations; and humanitarian assistance and disaster relief (HADR) missions. In addition to these external threats and responsibilities are sub-conventional challenges like terrorism and insurgency, which have necessitated the active employment of a substantially large force, both army and central police. Some of these deployments are also focused towards Pakistan that manifests itself in a variety of forms to include terrorism. Further, challenges like economic and cyber warfare go beyond the traditional realm of security. October 2017 | DefInsights | 19
IDEAS FOR ACTION
All of these necessitate the deployment of “soldiers” with different skill-sets to fight the adversary in these non-traditional domains. War, as a result, is increasingly assuming hybrid forms and has been waged successfully by countries like Pakistan and China against India for a number of years. The threat presented by Fake Indian Currency Notes (FICN) and cyber attacks on security and critical infrastructure has, therefore, become a challenge for trained professionals fighting the adversary, often unseen and unheard by a vast majority of Indians. This assessment implies that the nature of threats and challenges has undergone a transformation in the recent past and transcend the traditional notions of security. It also suggests that the instruments of the state required to fight the “enemy” also need to diversify, given the means and tools that an adversary like Pakistan is employing. This leads to the conclusion that India needs to reassess its threats, challenges and desired capabilities in light of this new normal of hybrid war. The existing concept of defence is individual service-centric, where each service largely plans and operates within its particular silo. Similarly, the counterterrorism approach to remains distinct to each arm of the state, with cooperation occurring at best at the functional level to achieve a basic level of cohesion. There are obvious conclusions which emerge from this reality. The first has been raised all too often; the lack of unity of effort and consequently a failure to achieve economy of effort. The lack of joint planning, joint training, and joint equipment (which includes procurement) affects 20 | DefInsights | October 2017
both efficiency and economy. The analogy of the Blind Men of Hindoostan would not be out of place here, wherein, each arm of the state perceives threats and challenges in its own way. The eventual manifestation of the actual threat ultimately compels the various arms to hastily coordinate for finding a quick fix solution or “improvisation” as it is often referred to. Further, the inherent desire to protect turf remains a stumbling block for defence reforms. The fight often tends to centre around allocation of funds and numbers of senior ranks that must at least be protected if not enlarged, rather than finding the optimum solution for the challenge at hand. Under these circumstances, solutions are bound to be coloured and driven by parochial interests. This is further aggravated by the impact of isolationist thinking related to the emergence of hybrid threats that manifests across traditional boundaries and demands an unprecedented level of unity of effort. Beyond conventional deterrence, the role and employment of the armed forces, therefore, needs a reassessment. The emergence of hybrid wars should have logically questioned the undue focus on extensive standing armies with multiple strike corps, which are unlikely to be employed as envisaged in the eighties. It should have increased our concerns about and understanding of limited wars, which now represent the maximal option in the shadow of nuclear weapons. While there have been attempts to reorient existing force levels to meet this new reality, the structure of the past continues to govern the vastly different real-
IDEAS FOR ACTION
ity of hybrid wars. Further, the fast, limited context of future wars also raises the issue of the profile of the armed forces and the equipment philosophy they have been adopting. The scale of the existing challenge at hand and the limited availability of resources have repeatedly laid bare the reality of shortages in critical areas like reserves in ammunition, special force capability development and intelligence resources. The armed forces need a structure and size which enables them to fight a faster paced, shorter and more efficient limited war. This demands a very different equipment profile, as also an efficient logistical support base. Since the funding for modernisation is likely to remain at existing levels of approximately 1.55 percent, as a percentage of GDP, the obvious conclusion is to re-prioritise resources towards the challenges actually being faced. This includes limited wars in the conventional domain, terrorism, and non-traditional security challenges like HADR and cyber attacks. When this reality is transposed upon the reforms being affected, it indicates the direction that security planning needs to take. First, even as the enhancement of the teeth to tail ratio remains critical, its implementation without addressing the simultaneous challenge of services functioning in silos will yield only limited benefits. The decision to cut down numbers must be linked with synergised efficiencies amongst the Ministry of Defence (MoD), affiliated Public Sector Undertakings (PSUs), Defence Research and Development Organisation (DRDO) and the three services.
Second, the streamlining of logistics initiated will remain sub-optimal unless the exercise is undertaken as a tri-service, ordnance factory and quality assurance related endeavour. Even as some areas will continue to remain distinct, greater efficiencies and economy should be created through greater cohesion. The cutting down of numbers from amongst the logistic support elements has to be accompanied by joint services establishments to achieve economies of scale. Therefore, it should be accompanied by the theaterisation of armed forces. Third, the ongoing reforms cannot be limited to the three services alone. It must also include the MoD as well as the entire national security architecture with a view to building an overarching organisation that can cohesively address the challenge of hybrid wars. To that end, one of the most critical strategic tools that remain lacking is a Special Forces command, which can undertake tasks beyond the tactical domain. This becomes imperative in an environment where punitive, clinical, offensive actions may need to be undertaken without resorting to a large-scale deployment of forces in conventional mode. Further, this capability cannot be restricted to the three services alone, as the task of creating intelligence assets in potential combat zones and providing high-quality inputs remains critical to the success of special forces. The emergence of threats in cyber and space should, therefore, become the basis for the creation of a cyber and space commands, with a capability of both defensive and offensive actions. This too is a field which relates to the larger concept of security, rather than the one represented by the three services alone. October 2017 | DefInsights | 21
IDEAS FOR ACTION
Fourth, as has been reiterated by a number of analysts in the past, reforms must be holistic and homogenous. Any attempt at piecemeal implementation is unlikely to yield the desired benefits and dividends. Even if the approach to reforms is sequential, the decision to undertake them fully in phases is a course that will allow flexibility of implementation and desirable readjustment. Fifth, past experience with defence reforms has clearly indicated that success has only been achieved when reforms benefit from the professional advice of the services and are backed by the willingness of the political establishment to enforce implementation. The existing resistance within the services and the civilian bureaucracy is unlikely to allow reforms that affect their status and the size of their establishments. It is for the political leadership to take the onus and responsibility of leading such an effort. It is also for political leaders to outline national security concerns and envisaged capabilities, for which the security agencies must thereafter provide a blueprint. Any exercise in reform in the absence of this critical datum is likely to result in limited incremental steps and an opportunity lost. Sixth, the success of defence reforms hinges on the availability of financial resources. Unlike the enhanced resources made available for reforms after the 1962 war and while implementing the 1975 committee recommendations through the eighties, the allocation is likely to remain around the existing levels. Therefore, the scope and size of reforms must be tailored to the needs of specific modernisation targets, even if these are achieved sequentially rather than concurrently. As an illustration, if limited wars and combating terrorism in J&K are identified as priority areas, the focus must be on the same, rather than thinly spreading 22 | DefInsights | October 2017
precious and limited resources across the army. The absence of guidelines outlining such priorities will result in piecemeal procurement of part capability in a variety of domains, which will fail to create enhanced combat effectiveness. These six guidelines must become the basis for undertaking major structural changes of the kind that has been visualised. While pushing through the ongoing reforms, the government must assess the pitfalls of similar reforms in the past. If this is done, it is likely to find that the process has often been constrained by the temptation to address limited peripheral issues, even as big core changes were deferred for reasons like lack of political consensus. Decisions like GST and the push for triple talaq have proved beyond doubt that the government has the will and desire to bring about paradigm shifts that challenge outdated ideas. The opportunity to transform the national security structure does not present itself often. The government should take up for implementing the recommendations that have been successively made by the Arun Singh, Kargil Review and Naresh Chandra Committees. It would also be useful to compare them with all 188 recommendations of the Shekatkar committee and evaluate what has been implemented so far. It is equally important to assess what remains pending for implementation because the seeds of major military change might just be found amongst recommendations that are yet to be taken up for implementation. The statement of the Raksha Mantri alluded to this very transformation in the form of a major military change in his statement of August 30, 2017. And a major change it must be for India to successfully address the challenge of ongoing and future hybrid wars. (The writer is a Research Fellow at the New Delhi-based IDSA, which first published the article)
INDUSTRY BUZZ
Saab-Adani announce intent to build Gripen E in India
Saab President Hakan Buskhe (centre-left) shaking hands with Adani Group Chairman Gautam Adani (centre-right), as Saab India Country Head Jan Widerstrom (left extreme) and Adani Group Defence and Aerospace Head Ashish Rajvanshi look on. On September 1, at the Le Meridian Hotel in Central Delhi, Swedish defence firm Saab’s President and CEO Hakan Buskhe shook hands with one of India’s leading business tycoon, Adani Group Chairman Gautam Adani. And history was made. The two companies that day announced their intent to collaborate in the aerospace and defence sectors in India, aligning their interest with that of the Government of India’s ‘Make in India’ initiative. Their primary target is to bag the multi-billion-dollar single-engine combat plane deal from the Indian Air Force to meet its requirement for 100, and possibly more, aircraft. “The intended collaboration would encompass design, development and production of Gripen for India and other high-tech products of national importance for India and also the creation of joint ventures in India in line with and in support of the ‘Make in India’ policy,” the two companies said in a statement. Saab, in partnership with Adani Group, will discuss possibilities to offer solutions to bring required design and manufacturing capabilities in defence and aerospace to India. A collaboration between Saab and Adani will combine the technical and product excellence of Saab, along with the industrial engineering, system integration and mega project execution capabilities of Adani with the intention to manufacture defence systems locally in India. With India’s focus on creating future-proof and home-grown capabilities across all industries, Saab and Adani will explore how to cooperate to develop a wider aerospace and defence ecosystem in India. A critical part of a joint roadmap would be to encourage the development of small and medium-sized enterprises along with a robust national supply chain.
“Our plans in India are to create a new defence eco-system that would involve many partners, vendors and suppliers. To achieve this, we need a strong Indian partner who can help create the framework for the infrastructure and eco-system to come into place,” Buskhe said at the event. Asked why Saab chose Adani for the Gripen E project in India, Buskhe said, “the Adani Group has a long history of entrepreneurship, spanning through decades of dynamic growth. We have been in touch with each other for over 10 years now and hence know each other and our capabilities well. Having executed big infrastructure projects such as ports and power plants, Adani Group had the knowledge to perform on such big projects. That’s how we decided to come together.” In his brief presence and quick intervention at the event, Gautam Adani said, “in continuation of our vision of nation-building, we are keen to play an instrumental role in helping transform India into a destination for world-class high-tech defence manufacturing.” Under the intended collaboration, Gripen would be offered to the Indian government as the best solution for India’s single-engine fighter aircraft programme. The collaboration would also include projects, programmes and technologies of national importance to India. The two companies’ plan is to develop the relationship into a structure of joint ventures in India for execution of the programmes, including the single-engine fighter programme, to support the ‘Make in India’ policy and exhibit the two companies’ long-term commitment to be jointly successful. October 2017 | DefInsights | 23
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