Category — Defense/ Security

Modi Accelerates India Defense Spending

In a concentrated effort to modernize its armed forces, the Defense Acquisition Council of India has approved 41 proposals at a cost of $19 billion since June, defense minister Manohar Parrikar told parliament in New Delhi this December. In July this year, Modi increased the limit on foreign direct investment in defense to 49 percent from 26 percent.

“I don’t recall the council clearing these many number of procurement proposals within six months and in four meetings,” Air Marshal R K Sharma, who has served in the air force for four decades, said in an interview in New Delhi on Dec. 4. “The indication from the government is that this trend in decision-making will continue.”

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December 21, 2014   No Comments

India’s First Nuclear Sub Begins Sea Trials

India’s first indigenous nuclear-powered submarine INS Arihant (Sanskrit: Ari = enemy; hanta = to destroy) was flagged off for sea trials from Visakhapatnam harbor – on the eastern coast in the state of Andhra Pradesh – by defense minister Manohar Parrikar. The Arihant, is a 112 meter 6,000 ton SSBN, or nuclear ballistic missile submarine.

Since the submarine has the capability of firing nuclear-tipped missiles from air- and sea-based platforms, India will be able to complete the nuclear triad of responding to nuclear strikes from land, air and sea.

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December 21, 2014   No Comments

“American investors want to be part of the Indian growth story…” – CSIS

Richard M. Rossow, Senior Fellow at the Center for Strategic and International Studies, Washington DC, where he occupies the Wadhwani Chair in US-India Policy Studies, delivered a talk on ‘US-India Economic Ties: The Next Ten Years’ at the ICFAI University, Hyderabad.

According to him, with further simplification of investment policies that is expected from the new government, American investors would find India even more attractive as an investment destination. Three areas which are likely to see significant growth in US-India partnership are civil aviation, defense and insurance sectors, which were, incidentally, opened up for foreign direct investment recently.

Rossow pointed out that it is very rarely that the voices from Washington, whether they are policy hawks, investors or strategy experts, speak in one voice and it is happening now. The roll out of Goods and Service Tax, simplifying of labor laws and reforms in land acquisition policies are three significant developments that global investors are awaiting in India. Anything else that improves the ease of doing business in India would significantly advance the economic ties between the two nations.

Specifically, while India-watchers are aware of the challenges in moving key legislation through the Rajya Sabha, the upper house of parliament, at this point of time, the investor community at large still has placed great hopes on significant progress in the economic environment in India, he said. Any disappointment on that front could again slow down the deepening of economic ties between the two nations, he added.

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December 15, 2014   No Comments

U.S.-India Discuss Projects in Defense

Speaking at the Institute of Defense Studies and Analyses in New Delhi on December 3, Puneet Talwar, U.S. assistant secretary of state for political-military affairs said that the U.S. and India are discussing more than a dozen production and development projects in defense. Talwar headed an inter-agency delegation, which includes officials from the U.S. state department, the Pentagon and the U.S. Pacific Command, to co-chair a political-military dialogue with officials from foreign and defense ministries.

Talwar said in his speech, “To us, our defense relationship with India is not transactional; it is an investment in our future together. We want to move beyond a buyer-seller relationship, towards one of co-development and co-production, where both our nations will benefit.” Since 2008, bilateral defense trade has grown from near zero to $10 billion, Talwar affirmed.

The New York Times reported last month that India was the world’s largest buyer of weapons, accounting for 14% of global arms imports, nearly three times as many as China, and that the U.S. had surpassed Russia, the traditional military hardware source, as India’s biggest arms supplier. India had short-listed five of 17 hi-tech items of military hardware offered by the U.S., the Press Trust of India reported earlier this week. These include naval guns, mine-scattering anti-tank vehicles, unmanned aerial surveillance system, Javelin missiles, and aircraft landing system for carriers, the report said. One of the ways the U.S. is moving the defense relationship forward was by modernizing the American defense exports licensing system. Less than 1% of licenses destined for India are denied, a figure that is on par or better than many of the U.S.’s closest partners, noted Talwar.

In the Indo-Pacific region, both the U.S. and India have key and complementary interests, Talwar said, adding that both sides “share a vision where all parties pursue resolution of their territorial and maritime disputes through peaceful means, in accordance with universally recognized principles of international law, including the United Nations Convention on the Law of the Sea. Securing these sea lanes peacefully is crucial to ensuring that international commerce can continue to flow without disruption,” Talwar explained, almost mirroring India’s view on freedom of navigation.

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December 4, 2014   No Comments

New Defense Minister Acts Quickly

Six times since the infamous Bofors scandal of the 1980s, India has cancelled the purchase and upgrade of its artillery. This is set to change. At his very first opportunity to chair the Defense Acquisition Council meeting, Manohar Parrikar issued orders for a Request for Proposal to be launched for 814 mounted-gun systems. The guns will be bought under ‘buy and make’ category – the first 100 guns will be bought off the shelf from an original equipment manufacturer and the remaining 714 will be manufactured in India by an Indian company.

Indian companies are already working in tandem with their partners. Larsen & Toubro  has a tie-up with Nexter of France, Tata with Denel of South Africa while  Kalyani group has a tie-up with Elbit of Israel. The Russians are already working with the Ordnance Factory Board which is a unit of India’s Ministry of Defense.

The India Expert hopes that the seventh time is a charm for this acquisition program.

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November 22, 2014   No Comments