Americanization of the Indian militaryNEW DELHI - Even though no final agreement has been reached on the India-US nuclear deal, the Americanization of the Indian military has begun.
India is looking to purchase six Lockheed Martin C-130J aircraft and accessories worth more than US$1 billion, the single biggest Indian military purchase from the United States. The C-130J is the latest version of the tried and versatile Hercules transport aircraft that has been a US workhorse for half a century, the longest continuous production run of any military aircraft. The model that India wants is an advanced version of the Super Hercules, capable of multiple functions.
The US Defense Security Cooperation Agency (DSCA), responsible for overseeing all foreign sales, announced last week that it had notified the US Congress of India's request for the sale of the aircraft as required by US law.
The major Indo-US defense deals so far are valued at much less. Recently, the Indian Army took delivery of 12 Weapon Locating Radars from US arms manufacturer Raytheon at a cost of $200 million.
Another is the recent $48.23 million acquisition of the amphibious transport vessel USS Trenton, with the six UH-3H helicopters to operate from it costing another $39 million.
The DSCA said in a notification to New Delhi recently that the sale "will enhance the foreign-policy and national-security objectives of the US by providing the Indian government with a credible special-operations airlift capacity".
The principal contractors will be Lockheed Martin Aeronautics Co in Fort Worth, Texas, and Rolls-Royce Corp in Indianapolis, Indiana. Offset agreements (30% investment in an Indian company) are expected to be worked out.
The Hercules purchase will mark an important diversification of India's military transport systems, which have traditionally relied on Soviet-supplied An-32 and Il-76 aircraft.
More important, it marks the first big entry of US arms to India's arsenal.
US arms exporters are keen to become major suppliers to the Indian market, while the US administration expects a breakthrough in bilateral defense relations next year, the US under secretary of state for political affairs said recently.
"In keeping with our new relationship, our firms want to be long-term partners," Nicholas Burns said.
Burns has been leading discussions to thrash out a final draft of the civilian Indo-US nuclear deal, which Washington wants to leverage for more defense deals.
India's import of military hardware and software will reach $30 billion within the next five years, the country's Associated Chambers of Commerce and Industry (Assocham) said in a study, "Private Sector Participation in Defense".
The big deals include 126 multi-role fighter jets (valued at close to $10 billion), a variety of helicopters, and long-range maritime spy aircraft.
In the past three years, India has spent as much as $10.5 billion, on radars (especially from Israel), submarines (from France), tanks (from Russia), and helicopters (France), making it the largest arms importer in the developing world.
Israel and the US
Observers say Israel and the US could become the main weapon suppliers to India, overtaking traditional partners Russia, France, the United Kingdom and Sweden.
Indian Defense Minister A K Antony said recently that Indian defense procurements from Israel in the period 2002-07 have touched the $5 billion mark.
Even with the US entry, no decline in defense trade between India and Israel is expected, as US manufacturers generally sell complete major systems such as fighter jets and naval ships, while Israel specializes in compatible ancillaries.
Over a period, Israeli defense companies have established subsidiaries in the United States and have been complementing US industry.
The one country likely to lose out is Russia, India's former Cold War partner, which still notches up annual sales of $1.5 billion to India.
To add to the 300 already procured, India is to take delivery of 350 more Russian T-90 tanks in the near future for close to $1 billion. T-90 tanks are recognized as among the best.
However, Moscow is unhappy with India's deepening defense relations with the West.
India's two biggest purchases in the recent past have been the Israeli Phalcon radars in 2004 for $1.1 billion, and six French Scorpene diesel attack submarines for $3.5 billion in 2005.
In a $600 million deal, the Indian Army is set to acquire 197 helicopters from European syndicate Eurocopter.
And now it is the Hercules.
Moscow has been letting its discomfort become apparent. In an arm-twisting tactic, Russia has asked for more money from India in the sale of aircraft carrier Gorshkov and Su-30 fighter aircraft, because of a weak US dollar.
Ideally, New Delhi would not like to annoy Moscow given the already entrenched relations, but the competition is stiff.
Dark horse, China
The US may not be the only new entrant in the intensely contested defense market. Experts in India have not ruled out dark horse China. Beijing is driven by business instinct, best demonstrated by its about-turn over the Indo-US nuclear deal, with prospects of contracts worth $100 billion.
Despite a recent ugly situation when Beijing refused a visa to a senior government officer from Arunachal Pradesh, an Indian state in the northeast that is claimed by China, New Delhi and Beijing have decided to take military ties to the next level by holding "periodic joint military training exercises".
Indian Army chief J J Singh recently visited China, a year after the defense ministries of both the countries set up an institutional process to ensure frequent high-level defense exchanges, including an annual calendar for joint military exercises.
Last week, speaking at a plenary session of the sixth Asia Security Conference in Singapore, Antony said: "Our relationship with China is improving considerably. We will try to settle all our issues [with China] through negotiations. For that, as a first step, we have started a lot of confidence-building measures."
Antony met with Lieutenant-General Zhang Qinsheng, deputy chief of the general staff of the People's Liberation Army.
Some experts say that it is not beyond Beijing to offer major concessions on a territorial/border dispute to make a dash for defense contracts, especially with Indian private firms likely to enter the arena in a big way. In the recent past, Beijing has recognized another disputed area, Sikkim, to be part of India, in the interest of maintaining business bonhomie.
With a defense-procurement and offsets policy in place, New Delhi has been looking to grant some of India Inc's biggest names, including Tata Motors, Godrej & Boyce, Mahindra & Mahindra, Larsen & Tourbo, Ashok Leyland and Bharat Forge, Raksha Udyog Ratna (RUR), or defense-industry status. The RURs would be treated at par with public-sector undertakings that currently dominate all aspects of the defense industry.
Until very recently it was unthinkable that the US, which focused on arming Pakistan for years, would sell armaments to India.
China's missile and defense capabilities are much ahead of India's, best demonstrated by its anti-satellite weapon test early this year.
Given its strategic relations with Pakistan, including in defense, Chinese firms have been prevented from entering the Indian ports and telecom sectors.
However, Chinese companies have executed several major infrastructure and energy projects in India, while Indian software companies have set up bases in China.
Siddharth Srivastava is a New Delhi-based journalist.