Saturday, 31 March 2012

Menchuka: visit to Shangri-La

A view of the Menchuka valley, with the Yar Gyap Chu river dividing mid-stream into what looks very much like a map of India... of course, with the northeast missing!!

by Ajai Shukla
Business Standard, 31st Mar 12

My first glimpse of Shangri-La blows away the fatigue. After eight gruelling hours of bumping along the mountain road from Along (itself a full day’s drive from the Assam plains), the Bolero rounds a corner and the thickly-forested gorge opens into a wide valley. Here is Menchuka, the remote, mystical valley through which meanders the medicinal Yar Gyap Chu river. (In Tibetan, men is “medicinal”, chu is “water”, and ka is “alongside”.) It is a crystal-clear day, rare on the rainy, 17,000 ft-high Himalayan watershed which is the McMahon Line, the disputed border between India and Tibet in Arunachal Pradesh. Steep mountain walls enclose the valley on either side with snow-clad ramparts.

Such is the geography of Arunachal Pradesh, our north-eastern version of the Land of the Five Rivers. Five major rivers flow from the eastern Himalayas to the Brahmaputra in Assam, their valleys separated by 16,000 ft-high ridges. These are not rivulets but mighty torrents — the Lohit, Dibang, Siang, Subansiri and Kameng — which meet to form the Brahmaputra, the soul of Assam. A mere handful of roads connects these river valleys to one another. For the most part, the only way to travel from one valley to the next is to drive down the valley for a day or more to Assam, then drive along the Brahmaputra on National Highway 52, and then do the long drive upriver to one’s destination in the other valley. This downriver-upriver layout sometimes requires a three-day road journey to a destination that is just 70 km away on the map.

Near the river, at the entrance to Menchuka, a town of 10,000 people, is a spot marked by a sea of Buddhist prayer flags. This commemorates what used to be the rock seal of Guru Rimpoche, which marked Menchuka as one of the “hidden valleys” of Tibetan lore. According to legend, the 8th-century Guru Padmasambhava — since he carried Buddhism from India to Tibet and founded the Nyingma sect, Tibetans regard Guru Rimpoche as second only to the Buddha himself — guarded against the inevitable moral degeneration of his followers by secreting a number of hidden sanctuaries, each a remote, beautiful, unpopulated paradise, to which the faithful could migrate when life became unbearable.

Guru Rimpoche hid the keys to these sanctuaries. It required an exceptional person, known as a terton, endowed with high moral qualities, to decode the location of a hidden valley through a set of clues called a terma. In Guru Rimpoche’s great plan, the terton would then guide his followers to one of these Shangri-Las which would be marked by a sign, such as a rock shaped in a certain way or stamped with a seal. Legend has it that Sikkim was the first of these hidden treasures to which paradise-seekers migrated in the 14th century. That initial foothold was followed by full-scale Tibetan colonisation in the 17th century and the establishment of a dynasty by the Choegyals, who ruled Sikkim until India annexed it in 1974.

In the early 18th century, a terton from Kongpo, the rugged yet beautiful area around the Tsangpo bend in Tibet, led his paradise-seeking followers away from the depredations of the invading Mongols into what is today Menchuka. Paradise, however, was short-lived. By the 19th century, Menchuka became a lucrative addition to the Gachak estate in Kongpo and its wealth of agricultural produce, livestock and medicinal plants was heavily taxed. Even after India’s independence, the local Buddhist Memba people continued to pay tribute to the masters in Tibet. That relationship ended with the arrival of India, when a platoon of 2nd Assam Rifles marched into Menchuka in 1948.

* * * * *

The Indians brought in strange ideas, recounts 70-year-old Pema Phelye, including the abolition of slavery, a tradition by which Tagin tribesmen from Subansiri were purchased by Membas for domestic and agricultural work. A cadre of competent and sensitive administrators from the pioneering Indian Frontier Administrative Service ended slavery and the rule of the local Tibetan chieftains, one of whom was Deb Pema. But what made India unquestionably welcome in Menchuka was an end to the punishing tax payments to the overlords in Kongpo.

Menchuka today, like Tawang, and the neighbouring valley of Manigong, remains a Buddhist enclave in an area that was historically home to the tribal Lhobas, or “savages”, as the Tibetans saw them. The people of the Brahmaputra valley saw these remote hill tribes the same way; the Assamese called them Abors or “uncontrolled”. These masters of the forest are today the Adi tribe, as cultured and sophisticated as any people in the country, who have long played a dominant role in the politics of Arunachal Pradesh.

The old links with Tibet made Menchuka a key Chinese objective in the 1962 war, along with Tawang and Walong. A handful of Indian defenders from the 2 Madras and 2/8 Gorkha Rifles were ordered to withdraw in the face of a Chinese advance and join a larger force at Taliha in the neighbouring Subansiri valley. Harried by fast-moving patrols from the People’s Liberation Army, most of them perished in the retreat. An entire Gurkha platoon (36 soldiers), led by four officers, disappeared without trace in the thickly forested mountains while attempting a suicidal cross-country move to Taliha. Locals still recount tales about the month that they spent under PLA occupation, after Beijing’s unilateral ceasefire of November 21, 1962. Chinese soldiers did everything they could to win local loyalty, but the Membas, with memories of the Tibet revolt of 1959 fresh in their minds, saw through the opportunism in their overtures.

Today, the Chinese would face an immeasurably more difficult task if they attacked Menchuka. It is strongly defended by the army’s Red Devils. The army presence can hardly be missed, whether in the form of heavy vehicles growling along the roads, a very visible army encampment, military signposts everywhere (sample: “After a hard day’s work and sweat we, the Red Devils, love to have Chinese for supper”), or the AN-32 transport aircraft that roar in and out of the airfield in the middle of Menchuka town, bringing in the supplies that keep the army going. On their way back to Assam, the AN-32s give lifts to locals who need to move out in a hurry.

The actual border with China is at the Lola Pass, some 45 km from Menchuka. The Line of Actual Control (as the border is called) is not disputed here, as it is in other sectors like Longju. But Tibetan civilians have been apprehended in Indian territory while gathering the medicinal plants that this valley has always been famous for. Locals tell us that the Indo-Tibetan Border Police (ITBP), which physically guards the border, arrested a large group of Tibetans some six years ago when they intruded into India.

Intrigued, I go to the sub-division headquarters, where I meet Additional Deputy Commissioner Gepak Poyum, an Adi from Along. A small-framed man in a tiny office, with a photograph of Subhas Chandra Bose hanging on the wall, Poyum is kept warm by a wood-burning bukhari that crackles comfortingly. With not a file on his desk, he is happy to chat with a visitor from Delhi. Yes, the Tibetans did come, and were kept by ITBP for about a month, he tells us. They must have been collecting yartsa gunbu, the magical plant that grows in high mountain pastures, transforming into a caterpillar in winter and a fungus in summer. China loves yartsa gunbu, I learn; it is reputedly a potent aphrodisiac. It is sent to Tibet for the equivalent of Rs 80,000 per kg; the street value in Menchuka of 1 kg of yartsa gunbu is Rs 30,000.

What happened to the Tibetans, I ask? Poyum tells me that release orders came from New Delhi because they had strayed across by accident. In early 2007, they were repatriated across Lola. Clearly things on the ground between India and China are not as bad as many imagine!

* * * * *

Menchuka’s long tradition of medicinal herbs, which formed a sizeable component of the tax payments to Kongpo, is now being commercialised. Pasang Sona, the MLA from Menchuka, has leased a large tract of land to Pronaali Agro-Tech, a company run by former tea planter Giri Sodhi. Perched on a hillside with a spectacular view of Menchuka, Sodhi has converted this into a plantation for Taxus bacata, an evergreen conifer long known as the yew. The toxic component of Taxus Bacata, known as taxol, is a powerful chemotherapeutic drug for treating breast and cervical cancer.

Sodhi has tied up with German pharmaceutical company Fresenius Kabi Oncology (it acquired Dabur Pharma some years ago) which will process Menchuka’s Taxus bacata in its laboratories in Sahibabad and Kalyani into anti-cancer medicines. Fresenius Kabi currently imports Taxus bacata from Europe and South America; it hopes to cut costs to one third by sourcing it from Menchuka.

For Sodhi, this is a high-stakes, high-risk game, with a strong element of adventure. He says, “My expenditure on 70 hectares of Taxus bacata, over 20 years, on field development, planting, irrigation and labour will work out to about Rs 25 crore. And my income flow will only begin after six or seven years. But Fresenius Kabi is supporting this strongly.” He adds: “This is hard work, 20 hours’ driving time from Assam in a very remote area. But it is very enjoyable, and I take satisfaction in being able to cut treatment costs for cancer patients in the future.”

The Arunachal Government is watching and waiting. Poyum says, “We are watching to see how this works. If it is a success, other locals will also start growing. And definitely, we will support [it] because the tradition in Menchuka of growing medicinal herbs stopped due to medicines coming from Kolkata and Mumbai.” We look out at Menchuka from Sodhi’s fields, where lovely Memba women tend to the plants. The Yar Gyap Chu flows placidly, an island in midstream shaped exactly like India. An army patrol climbs the hill slowly, familiarising itself with the area they are tasked to defend.

A few years ago, when the road to Menchuka was being completed, the Border Roads Organisation was blasting Guru Rimpoche’s rock seal which was in the way. But nobody from Menchuka protested. In traditional Tibetan Buddhist belief, paradise had already been desecrated when armed forces entered it and a war was fought there in 1962. Menchuka has moved on from its legendary past.

Friday, 30 March 2012

Defence Min signals growing acceptance of private sector

The defence minister, AK Antony, talks to crewmen from 75 Armoured Regiment atop an Arjun tank at the Defexpo India 2012

By Ajai Shukla
Business Standard, 30th Mar 12

A series of policy statements by top ministry of defence (MoD) officials today highlighted the government’s growing belief that India’s private sector should be entrusted with a significantly larger role in defence production.

Defence Minister AK Antony, while inaugurating Defexpo India 2012, the seventh in a series of Indian Land and Naval Systems Expositions that began in 1999 and is organised every alternate year, also indicated that India’s defence spending would remain at a modest level of about 2% of the country’s Gross Domestic Product (GDP), which he termed “consistent with our security needs, as well as our requirements in the area.”

Projecting an optimistic view of India’s economic growth, the defence minister stated, “With the projected growth of the Indian economy expected at a trajectory of 8-10% for the next two decades, expenditure on defence in absolute terms is bound to increase.”

Speaking later at a Defexpo seminar, the MoD’s top procurement manager, the Director General (Acquisitions) Vivek Rae put a figure to the spending growth. Rae projected, “you will see a growth in defence modernisation budgets of about 13-14% per year, which means that the budget would double every five-six years.”

The capital allocation in the defence budget for 2012-13 is Rs 79,578 crore (US $15 billion).

The defence minister also sought to dampen longstanding disquiet over the Indian defence industry’s failure to sufficiently indigenise equipment development and manufacture. Antony said, “the ratio of foreign to domestic industry procurement by the Armed Forces was 70:30 some years back, but it has started changing and is (today) approaching 60:40.”

Antony’s own indigenisation target, announced through repeated public statements, has been to reverse the 70:30 import-to-export ratio to 30:70.

Most significantly for the private sector, Minister of State for Defence, MM Pallam Raju, affirmed that the MoD would very soon concede a long-standing private sector demand that the three services’ long-term equipment plans be communicated to them, to enable private companies to make timely decisions about developing futuristic equipment. Currently, the public sector industries are party to long-term plans, while the private sector has often learned about future equipment requirements too late to participate meaningfully.

Acknowledging this concern, Pallam Raju said, “The lack of adequate information regarding the (military’s long-term) defence requirements has been one of the major impediments in the growth of the defence industry in India. The government is in the process of finalizing the Long Term Integrated Perspective Plan (LTIPP) of the Armed Forces.”

The LTIPP specifies the equipment and technologies that the military will require over a 15-year time horizon. The LTIPP was initially supposed to cover the period 2007-2022, but after five years of delay will now cover the period 2012-2027.

Once this is finalised, says Pallam Raju, “a public version of the document outlining the ‘technology perspective and capability roadmap’ of the armed forces covering a period of 15 years will be published and placed on the MoD website. This would enable the domestic industry to plan investment in the defence sector and take up Research and Development, technology upgradation and forge tie-ups and arrangements of collaboration with their associated foreign industry partners in order to meet the future requirements of the Armed Forces.”

DG (Acquisitions) Vivek Rae provided another indication of the MoD’s new inclination towards private sector participation by strongly supporting the “Make” procedure. According to the Defence Procurement Procedure, this allows private industry to bid for building complex military platforms, with the MoD funding 80% of the cost of development. There are currently only two “Make” projects being pursued: the Future Infantry Combat Vehicle (FICV); and the Tactical Communications System (TCS).

“To build up the defence base, we need to generate a lot of “Make” procedure (procurements). We will make a list of 150-180 “Make” procedure projects…. I think we could energise the industrial base of the country.

Pallam Raju, however, cautioned the private industry not to expect a fully-funded stroll into defence production. “The industry also needs to commit itself to the field in terms of establishing the required infrastructure and develop the capacities. Commitment to R&D effort is also required by the defence industry both in the public and private sector if the long-term goals are to be met,” said Raju.

Thursday, 29 March 2012

Defexpo 2012: Kalyani Group artillery to be featured

The Austrian Maschinenfabrik Liezen (MFL) 155 mm, 45-calibre gun that the Kalyani Group has imported, along with an entire gun-making factory that it bought from RUAG, Switzerland. The Kalyanis are making an ambitious foray into gun-making, with the intention of playing a major role in manufacturing India's large requirement of artillery

by Ajai Shukla
Business Standard, 29th May 12

Army chief General V K Singh’s leaked letter to defence minister A K Antony, which flagged the country’s lack of defence preparedness, casts a shadow over Defexpo India 2012, which kicks off in New Delhi tomorrow. However, the silver linings in the four-day event would be the impressive presence of several Indian private companies and newcomers in developing complex weaponry, with capabilities the defence ministry (MoD) can no longer ignore.

Among the most visible would be the Pune-headquartered Kalyani Group, which would emphatically project its ambition to develop artillery systems for the Indian Army. With foreign artillery procurement stalled for two decades, Baba Kalyani — who has shaped his flagship company, Bharat Forge, into the world’s largest forgings manufacturer — has committed the finance, the manpower and the strategic mind space he believes would make the Kalyani Group a full-spectrum developer of artillery systems.

Kalyani intends to start by building a 155 mm, 52-calibre towed howitzer, which the army desperately wants. Several years of user trials of foreign guns have only resulted in vendors being rejected, blacklisted, or withdrawn from the contest. Kalyani is now boldly offering an Indian alternative.

“I will offer to the Indian Army a fully developed artillery gun system, integrating all the command and control elements, before 2015,” he asserts.

To this end, the Kalyani Group has imported from Austrian gun manufacturer Maschinenfabrik Liezen (MFL) a service version of its famous 155 mm, 45-calibre, autonomous gun system, which had impressed Indian gunners when they evaluated it in the mid-1980s (though they bought the Bofors gun instead).

The Kalyani Group has also bought, knocked down and transported to India an entire operational artillery gun factory from Swiss company RUAG. Instead of learning the ropes of manufacturing artillery from scratch, Kalyani’s designers in Pune intend to absorb foreign technology, thereby leapfrogging an extended development process. Unlike many Indian private companies, Baba Kalyani is investing his own money into building capabilities. Given Bharat Forge’s hardcore engineering pedigree, he is confident he has the solution.

Says Kalyani: “There are the DRDO ((Defence Research & Development Organisation), the OFB (Ordnance Factory Board) and other excellent organisations that have design talent and capability. What India lacks is the ability to convert designs into manufactured products. This is where the Kalyani Group comes in. Building an artillery gun system is largely about materials, forgings and manufacturing. We have in our group the capability to be a top-class manufacturer of precision products.”

Kalyani Steel would provide the steel and metallurgy. The drives, engine, transmission, etc would be built by Automotive Axles Ltd, the Rs 2,000-crore Kalyani Group company and the largest manufacturer of axles in the region.

Alongside the engineering bravado, there is realism, too, about the Kalyani Group’s inexperience in creating the sophisticated software that underpins the gun control, fire correction and command and control systems, about 50 per cent of the overall gun system.

“Our strategy is to collaborate with entities that already have capabilities in electronics and guidance. (For this) we are in constant dialogue with the DRDO and the MoD. But we are confident about the precision engineering needed for the mechanical parts of the gun,” says Kalyani.

The only “missing link”, as Kalyani puts it, is the reliance on the MoD for testing facilities. Guns under development must be periodically tested through live firing. In India, this can only be conducted in cooperation with the Army. The MoD, rattled by the repeated failures of artillery gun procurement programmes, has already initiated two projects in the public sector to develop an artillery gun. The OFB has been asked to construct two 155 mm, 39-calibre guns from the engineering drawings that came with the Bofors gun in the mid-1980s. The OFB would then try to upgrade these into longer-range 155 mm, 45-calibre guns.

Simultaneously, the MoD has sanctioned Rs 150 crore for the DRDO to develop a 155 mm, 52-calibre gun. The DRDO’s Armament R&D Establishment (ARDE), Pune, would soon float a tender for an Indian industrial partner, in which the Kalyani Group intends to bid.

Such is the aggressiveness within the Group that it intends to develop its own gun on a parallel track, even if it becomes an industrial partner to the DRDO for the ARDE’s gun. Rajinder Bhatia, who would head this project, says, “We are willing to compete against ourselves. On one track, we will work with the DRDO, funded by the government. On our own track, we will fund ourselves. Baba Kalyani is willing to commit Rs 100 crore for this.”

Defexpo India 2012 kicks off today

Most of the 230-odd foreign companies that will display their wares at Defexpo India 2012 in New Delhi from 29th Mar to 1st April will be primarily targeting the Indian defence market

by Ajai Shukla
Business Standard, 29th Mar 12

Defexpo India 2012, the country’s biggest-ever land, naval and homeland security systems exhibition, would be inaugurated here tomorrow. About 580 exhibitors (compared with 425 exhibitors in Defexpo 2010, the last exhibition), spanning the spectrum from global defence giants to Indian small scale industries, have worked around the clock for over a week, putting together displays that might catch the eye of MoD acquisition managers in the capital city of the world’s biggest buyer of weaponry.

Scheduled to be inaugurated by defence minister A K Antony, this would be the seventh in the series of land, naval and internal security systems exhibitions India holds every other year. The exhibitors will include 232 foreign firms, mainly from the US, Russia, France, Israel, the UK and Germany, along with 60 official delegations.

While defence expos all over the world have forums for interaction between buyers and sellers from all countries, the Defexpo India series feature primarily one buyer: India. The bulk of the exhibitors frankly admit they focus solely on selling arms to this country alone.

Held at the capital’s Pragati Maidan, Defexpo India 2012 has been organised by the Defence Exhibition Organisation (DEO), an MoD organisation that promotes exports of the defence public sector undertakings (DPSUs), the Defence Research & Development Organisation (DRDO) and the Ordnance Factory Board (OFB). Besides the Defexpo, it is also the nodal and co-ordination agency for the Aero India show, an air show held every alternate year in Bangalore. Partnering the DEO as event manager is the Federation of Indian Chambers of Commerce and Industry.

For global defence vendors, Defexpo 2012 is an important opportunity for entering the Indian market, estimated at about $100 billion between now and 2022. Supplementing this figure would be another $19 billion by 2017 on homeland security. The Indian capital budget is already $16 billion this year, and rises at about 15 per cent annually.

Currently, foreign vendors supply an estimated 70 per cent of India’s weaponry. New Delhi has repeatedly declared, without setting any timeframe, it should source 70 per cent of its defence needs indigenously. Global majors, therefore, are establishing partnerships with Indian defence producers to become a part of the Indian defence business. Currently, there is a cap of 26 per cent on foreign direct investment in defence. The commerce ministry, however, is pressing for this to be raised to 74 per cent, or at least 49 per cent.

Tie-ups with Indian companies are also driven by foreign vendors’ offset liabilities, which would accrue from defence sales to India. The MoD’s offset regulations impose a minimum offset of 30 per cent of the contract value for all contracts above Rs 300 crore. This must be discharged through the purchase of products or services from Indian defence companies or investments into the industrial infrastructure of Indian defence joint ventures or investment into Indian research & development organisations. In all the cases, the foreign vendor must identify an Indian partner through which it would discharge its obligations. Defexpo 2012 provides defence companies a platform to meet prospective offset partners.

Wednesday, 28 March 2012

Bribe row puts spotlight on BEML's Tatra

Why has the army bought 7000 of these vehicles from BEML, over a quarter of a century, without insisting on full customisation and indigenisation?

by Ajai Shukla
Business Standard, 28th Mar 12

The electrifying revelation by Chief of Army Staff General V K Singh that he was offered a bribe of Rs 14 crore — apparently to sanction the purchase of 600 Kolos Tatra high-mobility vehicles — has highlighted a crucial question: How has the defence public sector undertaking, Bharat Earth Movers Limited (BEML), been supplying the army with what it considers a largely imported vehicle at an exorbitant price for a quarter of a century?

Since 1987, when BEML supplied the army with the first Tatra high-mobility vehicles that had been procured from Czechoslovakia, today 7,000 Tatra vehicles feature on the army’s inventory. Successive army chiefs cleared the purchase of repeated tranches of Tatra vehicles. But, in 2010, General V K Singh turned down a fresh procurement request, ordering instead a multi-vendor procurement of a suitable Indian vehicle.

Singh’s objections to the Tatra were threefold, explains a top-ranking army officer who plays a key role in equipment procurement. First, BEML had not indigenised production adequately. Almost 70 per cent of the Tatra was sourced from abroad. Second, despite BEML’s so-called ‘manufacture’ of the Tatra for decades, it remained a left-hand-drive vehicle that was unsuitable for Indian conditions. Third, Gen Singh believed BEML was making windfall profits on the Tatra, selling it to the army for about a crore rupees a vehicle, when it could be bought in Eastern Europe for half that cost.

“The Tatra was horrendously expensive. BEML was focused on maximising profits without even substantial indigenisation,” says a top procurement official of that time.

BEML chairman V R S Natarajan rejects charges of insufficient indigenisation and points out the purchase contract with the Tatra did not include transfer of technology (ToT). “We didn’t buy the technology for the Tatra. They are helping us indigenise without India paying for it… Despite that, the Tatra today is 60 per cent indigenous,” says Natarajan.

But top army officials, who are seeking a replacement for the Tatra, call that laughable. “In 25 years, BEML has not even bothered to modify it into a right-hand-drive vehicle; what indigenisation have they done?” asks a senior serving general.

Natarajan has an answer. “If the army wants to make it right-handed, we can do it. But they are not asking for that… The army is used to (the Tatra); they are driving it; and we are supplying it,” says the BEML chief.

Asked to confirm how much of the Tatra is built in India, the MoD’s joint secretary (land systems), Rashmi Verma, puts the figure at 45 per cent. But Natarajan dismissed her assessment. “If you ask her a specific question, she will ask information from me and then tell you. On her own, she might not know. But I know 100 per cent.”

With General Singh exasperated at BEML, he pushed for an alternative. Army records show the MoD cleared the procurement in mid-2010; by end-2010, a tender was floated for an Indian replacement for the Tatra. Four companies — Tata Motors; Ashok Leyland; Ural (India) Ltd; and BEML — fielded their high-mobility vehicles in trials, conducted through 2011. A winner is likely to be declared this year, say army sources.

For BEML, this signals the end of a series of lucrative repeat orders for the Tatra. All these years, the Tatra was not governed by the strict safeguards the Defence Procurement Procedure imposes on fresh procurements. The safeguards do not govern repeat orders for an “in service” vehicle. For such orders, the Master General of Ordnance, a lieutenant general in army headquarters, New Delhi, has the power to initiate a fresh purchase without clearance from the MoD.

But there still existed the possibility of one last lucrative order for the Tatra, before other domestic alternatives ended its long-running monopoly. Sources close to Gen Singh allege that this was the proposition for which he was offered Rs 14 crore.


Entered Indian Army service : 1983-84

Usage : Tank transporters, carriers for assault bridging, cross-country logistics vehicles, command posts, signals communications nodes

Country of origin : Czechoslovakia; Currently built in both Czech Republic and Slovakia

Ownership : Vectra Global, owned by NRI Ravi Rishi


Wheel configuration : 8 x 8

Engine power : 347 horsepower

Climbing gradient : 60 per cent

Weight (empty) : 15 tonnes

Maximum road speed : 80 kmph

Trench crossing : 2 metres wide

Maximum load : 15 tonnes

Range : 650 km

Water fording : 1.4 m depth

Monday, 26 March 2012

Foreign arms vendors contest MoD’s unexplained blacklists

Sudipta Ghosh, whose arrest by the CBI soon after he retired as the Ordnance Factory Board chief, led to the unexplained blacklisting of multiple arms vendors

By Ajai Shukla
Business Standard, 26th Mar 12

For years, eagerness to enter India’s massive arms bazaar has led the world’s biggest and most influential arms companies to meekly accept diktats from New Delhi that no other buyer imposes. Overseas vendors spend fortunes on developing India-specific weaponry and on “no cost, no commitment trials” in the hope of a lucrative order. But the defence ministry (MoD) now faces a rebellion after blacklisting four international arms companies early this month, apparently on the mere suspicion of wrongdoing.

In a sharply worded statement on Friday, Swiss arms giant Rheinmetall Air Defence (or RAD) says it “objects to the decision of the Indian Ministry of Defence announced on 5 March 2012 to exclude it from doing business with India’s Ordnance Factory Board (OFB). This decision was based on allegations against RAD which the company categorically rejects as false and as entirely without merit.”

Criticising MoD high-handedness, the company notes, “The Indian authorities have yet to inform RAD of the details of these allegations. Transparency with regard to investigations would enable RAD to put forward conclusive evidence that will refute all claims made against it.”

Another vendor, Singapore Technologies Kinetics (ST Kinetics), has already dragged the MoD to court. In three petitions, filed in the Delhi High Court last March, the company protested “the arbitrary suspension of ST Kinetic’s defence business activities.”

Now the Swiss company could go to court too. RAD has told Business Standard that, “Rheinmetall Air Defence is contemplating all options, including legal, to defend its reputation and prove these allegations false.”

The ongoing controversy over blacklisting stems from the arrest, on 19th May 09, of the former Ordnance Factory Board (OFB) chief, Sudipta Ghosh, who was being watched by the Central Bureau of Intelligence (CBI) on suspicion of accepting bribes from potential vendors. After the CBI arrested Ghosh, Defence Minister AK Antony announced through the media that seven arms vendors were blacklisted until further notice. These were ST Kinetics; Israel Military Industries Ltd (IMI); Media Architects Pvt Ltd, Singapore; BVT, Poland; and three medium-sized Indian companies. Rheinmetall was not on that list.

To date none of the companies that Antony publicly named have been told the charges against them, nor has any CBI charge sheet been filed. On 28th July 2010 Antony told parliament that charge sheets have been filed against Sudipta Ghosh; and against two Indian companies, TS Kisan & Co; and RK Machine Tools Ltd.

The foreign vendors emphasise that they have cooperated closely with the CBI in attempting to clear their names. According to STK, “we had even offered on several occasions to open our account books for inspection by the Indian authorities, but these offers were never taken up by them.” Similarly, RAD tells Business Standard that it has provided “comprehensive documentation in exchanges with Indian authorities.”

With only silence from the MoD, and Antony’s ban blocking them from the Indian market, ST Kinetics approached the Delhi High Court last year, seeking clarification on why they had been blacklisted. Court records indicate that, despite repeated opportunities given by the court, the MoD failed to provide an explanation. A public statement from ST Kinetics says, “the MoD repeatedly (told the court) that ST Kinetics is not blacklisted and that the ‘putting on hold’ of ST Kinetics’ defence business activities is but an interim arrangement only.”

With the court set to deliver final orders on 21st Mar, the MoD hurriedly announced a blacklist on 5th Mar. This debarred six firms --- ST Kinetics; IMI; RAD; Corporation Defence, Russia (CDR); and two Indian companies, TS Kisan & Co; and RK Machine Tools Ltd --- from doing business dealings with the OFB for ten years.

According to the MoD: “The firms were recommended for blacklisting by the CBI on the basis of evidence collected against them…. The decision to debar was taken today after taking into consideration their replies (to the MoD’s show cause notices).”

It remains unclear why this blacklist differs from the one Antony announced to the press after Ghosh’s arrest in May 09. The blacklist is also significantly different from the one Antony gave parliament on 28th Jul 10, naming seven foreign companies that the CBI had recommended for blacklisting. Besides ST Kinetics, IMI, RAD and CDR, that list included South African company, Denel; Israeli company, Soltam; and Varas Associates, from the Isle of Man.

ST Kinetics seems likely to file a fresh case against the MoD. While disposing of ST Kinetics’ earlier petitions, which the MoD had scuttled by announcing a blacklist, the Delhi High Court had directed that ST Kinetics had the liberty to file a fresh petition. The company has stated that, “ST Kinetics intends to vigorously take appropriate actions (sic) to clear its name and defend its reputation.”

Says procurement analyst Major General Mrinal Suman: “The flimsiness of the MoD’s case is evident. Instead of the vendors being charged and prosecuted in court, they are taking the MoD to court. How can the MoD impose bans without due process? They must explain to the accused the charges against them; there are hard-won corporate reputations at stake here. And each time a ban is imposed, one or more procurement programmes get derailed.”

ST Kinetics plans to participate in the MoD’s Rs 8,000 crore tender for 155 mm, 52 calibre towed artillery guns; and in another Rs 3,000 crore tender for 140 ultra-light 155 mm, 39 calibre howitzers for the Indian Army. The company is also a strong contender for supplying the Ministry of Home Affairs with 43,318 close quarter battle (CQB) carbines, with day and night sights, as well as even larger MoD tenders for modern carbines.

Thursday, 22 March 2012

DRDO wants say in procurements: Says indigenous weapon programmes should not be scuttled by substandard production

The Akash production line at Bharat Electronics Ltd, Bangalore. The DRDO wants to choose the production agency for the weapons platforms that it builds

Ajai Shukla
Business Standard, 22nd Mar 12

Besides asking for more funds for research and development (R&D), the Defence R&D Organisation (DRDO) has pleaded not to let its successful indigenous weapon programmes be scuttled by substandard manufacture in defence public sector undertakings (DPSUs) and in production units of the Ordnance Factory Board (OFB).

There is a serious concern within the DRDO after the Arjun tank, which outperformed the Russian T-90 tank in army trials last year, disappointed the frontline combat units for whom it was bulk-produced by the Heavy Vehicles Factory, Avadi (HVF). The apparent reason: poor manufacture and ineffective quality control.

DRDO chief V K Saraswat, during the organisation’s 36th Laboratory Directors’ Conference that concluded here, on Wednesday, demanded that DRDO have a say in choosing the factory that manufactures its systems.

Seeking intervention of the defence minister, Saraswat stated: “DRDO is mandated to develop prototypes and then hand over to production agencies for large-scale manufacture. But we have realised that a substantial amount of handholding is required in the post-development phase. DRDO would like to play a lead role in (the) selection of production partners and the lead integrator for production of DRDO-developed products, so as to ensure seamless transfer of technology, productionisation and product support."

DRDO seeks to pre-empt potential production glitches in the 248 Arjun Mark II tanks that HVF Avadi will build. Another concern is the Tejas light combat aircraft. While the DRDO-headed Aeronautical Development Agency (ADA) has developed the Tejas, it will be mass-produced by public sector giant, Hindustan Aeronautics Ltd, which is apparently insufficiently prepared for the job. Saraswat also drew attention to the need for “hand-holding” by DRDO in producing the Akash missile system, being built by two DPSUs — Bharat Electronics Ltd and Bharat Dynamics Ltd.

Top DRDO sources tell Business Standard that identifying a production partner at the start of a project, and involving that partner through the development process, is essential for successfully delivering a high-tech product to the military. Instead of the current practice of the MoD arbitrarily nominating a DPSU or OFB factory to build the product, usually when development is almost completed, the DRDO would select a capable partner company from the outset, from the private sector if necessary.

But the MoD quickly made it clear that DRDO would not be given discretionary powers. Defence Secretary Shashi Kant Sharma agreed it was crucial to involve a production partner from the beginning of a project, but arbitrary selection was not an option. “For selection of a production partner at the development stage itself, a fair and transparent methodology is much (sic) essential. Also, preferably, there should be multiple development of production partners instead of a single production partner,” said Sharma.

Defence Minister A K Antony also implicitly opposed Saraswat’s proposal, suggesting DRDO discretion might contravene the requirement for transparency. “You must develop this collaboration in a transparent manner. Otherwise, midway, you will land in trouble. We will not tolerate any malpractices… otherwise, ultimately, we will have to cancel the collaboration. At every stage, you must see that we are proceeding as per correct procedure.”

“The problem is that nominating a DPSU like BEL, or an ordnance factory, for mass producing an equipment is considered transparent. But choosing a private sector company, even on logical grounds, risks being viewed as a malpractice,” says the CEO of a private sector company pursuing opportunities in defence production.

Almost Rs 1,50,000 crore worth of DRDO-developed military equipment has already been introduced into service with the military. The bulk of this has been produced by the public sector, although private sector manufacturers are now beginning to get a small share of the production.

Tuesday, 20 March 2012

DRDO requests for more funds

The Prahaar short range surface-to-surface missile, pictured here during its first test last year. The DRDO chief mentioned this missile yesterday as one of the DRDO's recent triumphs

by Ajai Shukla
Business Standard, 20th Mar 12

The chief of the Defence Research and Development Organisation (DRDO) complained to Defence Minister A K Antony today that the ministry had not allocated enough funds for research and development, given the number of weapon development projects on the anvil.

Speaking at a DRDO conference in New Delhi, where Antony was present, DRDO’s director V K Saraswat, said, “At the recently concluded Indian Science Congress, the honourable PM had promised a substantial increase in fund allocation for science and technology. But, it is noted in the Budget proposals for 2012-13, the share of funds for DRDO remains more or less the same. DRDO has a requirement of about Rs 14,000 crore against an indicated allocation of Rs 10,640 crore.”

Saraswat cited several new development projects that demanded immediate funding, specifically the short-range surface to air missile; the Arjun Mark II tank; the Tejas Mark II fighter; and the Agni-5 and Agni-6 nuclear-capable, long-range, ballistic missiles. “We request the honourable RM (raksha mantri) to consider higher allocation of funds for DRDO,” said Saraswat.

Antony said the government’s precarious finances made additional funding unlikely. “I know the limitations of this year’s defence budget. The finance minister is very sympathetic to defence ministry; he himself was the defence minister earlier. But this year he is in a very difficult situation. Difficult is a mild word… it is a very, very critical situation. Let us see if our economy revives this year; then in the second half, we will try and get more money. This year, despite the difficulties, we were able to give some more money to the Navy. Let us see if, in the second half (of the year) we are able to help the DRDO,” said Antony.

Saraswat’s request for more funding received support from Satpal Maharaj, chairman of the standing committee of Parliament on defence. Maharaj noted the share of R&D in the defence budget has risen from one per cent in the 1960s to six per cent today. He said the committee had recommended an R&D allocation of at least 10 per cent, given “certain countries in our neighbourhood” were spending up to 15 per cent.

The DRDO’s revenue budget for this year was Rs 5,995 crore, marginally up from last year’s Rs 5,386 crore. But the capital budget, which funds the development of new weapon programmes, remained stagnant: Rs 4,640 crore this year, against Rs 4,628 crore last year. If depreciation of the rupee and inflation are factored in, the capital budget was significantly reduced.

But Saraswat struck an upbeat note, playing up several landmarks that are coming up soon. The most keenly anticipated would be the first launch of the Agni-5, which can carry a nuclear warhead to a target 5,000 km away. Saraswat revealed the Agni-5 would be launched in April. Also coming up in “a few months” are the first flight of the Nirbhay long-range cruise missile; the Naval Tejas light combat aircraft; and a fully integrated airborne early warning and control system — an aircraft with a radar that can cover a large combat zone. The DRDO-developed radar system has been fitted on a Brazilian Embraer aircraft and has made its first flight in Brazil.

Get real with China on Tibet

A cellphone video grab of a self-immolation in Tibet, believed to be the sacrifice of Palden Choetso, a nun in China's Sichuan province

by Ajai Shukla
Business Standard, 20th Mar 12

In Arunachal Pradesh, where I travelled over the last 10 days, there is little illusion about the brutal character of Beijing’s rule over Tibet. Even Itanagar’s politically aware youngsters, who angrily contrast infrastructure development across the McMahon Line with the slothfulness and corruption in their own state, know about the paranoia that makes Beijing perceive in every Tibetan shadow a threat to the core interests of the Middle Kingdom.

Which was why I was startled, on my return to Delhi, to find an illustrious group of Indian thinkers recommending that Sino-Indian tensions be eased by “persuading China to seek reconciliation with the Dalai Lama and the exiled Tibetan community”. Their policy paper, entitled “Nonalignment 2.0: A foreign and strategic policy for India in the twenty-first century”, declares, “The Dalai Lama’s popular legitimacy among his own people is a fact that the Chinese government must acknowledge.”

The authors of this quixotic proposal – Sunil Khilnani; Rajiv Kumar; Pratap Bhanu Mehta; Lt Gen (Retd) Prakash Menon; Nandan Nilekani; Srinath Raghavan; Shyam Saran and Siddharth Varadarajan – do not represent the Indian government. But the preface notes that National Security Advisor Shivshankar Menon and his two deputies, Alok Prasad and Latha Reddy, also provided inputs.

The notion that New Delhi can talk Beijing into engaging the hated “Dalai clique” is entirely fanciful. Tibet, alongside Taiwan, remains the deepest of China’s many insecurities. Beijing considers India the biggest potential external threat to its brutal stranglehold over Tibet, just like America is its bugaboo on Taiwan. India provides life support to the Dalai Lama and the Central Tibetan Administration even as global leaders co-operate with Beijing in spurning His Holiness. Tibet’s historic monasteries – Ganden, Sera and Drebung amongst them (traditional power centres that China has desecrated and emasculated in Tibet) – now radiate influence from mirror-image establishments in southern India. And India’s 100,000-strong Tibetan refugee community is a potent reservoir for fomenting a major uprising in Tibet whenever New Delhi chooses. For Beijing, the idea of taking advice on Tibet from such a key potential adversary would be anathema.

Compounding Beijing’s misgivings would be its failure to extinguish simmering opposition within Tibet. Since March 1989, when martial law was imposed in Lhasa (three months before the PLA’s massacre of protesters in Tiananmen Square), Tibet has been subjugated by a security establishment so repressive that self-immolation has emerged as the only feasible expression of protest. Given the paranoia that drives Beijing’s militarised control, even self-immolation is treated as a challenge to the regime. Many Chinese security personnel in Tibet’s cities now tote small fire extinguishers alongside their intimidating array of weaponry. Last week Premier Wen Jiabao blamed self-immolations on “disaffection” spread by the Dalai Lama, intended to split Tibet from China. Wen declared that Beijing has a “firm position” on this.

Wen’s “firm position” has taken the form of a two-pronged strategy of “stability” and “development”. The former is the euphemism for essentially handing over Tibet to a multitude of security agencies that range from the feared People’s Armed Police to a growing rash of outfits that are given to black, commando-style uniforms and heavy truncheons. “Development” has involved resettling rural Tibetans into depressing cinder block communities from where they must pursue professions that are alien to the Tibetan tradition.

This has served only to deepen resentment. In 2008, riots broke out outside the Tibet Autonomous Region, across the Tibetan-inhabited areas of Amdo and Kham, which are now in the Chinese provinces of Sichuan, Gansu and Qinghai. That outbreak of rebellion continues in various forms even today.

In these poisoned circumstances, bumbling Indian do-gooders who seek to encourage dialogue would hardly be welcomed. How would Delhi have reacted to Pakistani suggestions to engage with Syed Ali Shah Geelani during Kashmir’s summers of rioting from 2008 to 2010? Remember, Beijing’s visceral hostility towards the Dalai Lama far exceeds Delhi’s animus to Geelani.

Nor should “Nonalignment 2.0” forget Beijing’s going-nowhere talks with the Dalai Lama’s representatives, which have sputtered along since the 1990s. This has allowed China to appear reasonable while conceding nothing. Beijing indicates that the only things to be decided are: when the Dalai Lama would resume his position as vice-chairman of the National People’s Congress; and in which part of Beijing he would like to reside after returning to the motherland. Qu Xing, director of the officially affiliated China Institute of International Studies, indicated Beijing’s approach last year. Referring to Tibet as a Chinese core interest, Qu said: “An important criterion of core interests is that they are not allowed to be negotiated and no compromise can be made on [them].”

For decades, New Delhi has danced to the Chinese tune, shrinking from even mentioning Tibet for fear of angering Beijing. This has allowed China to keep the spotlight on Arunachal Pradesh and, therefore, off its deepening vulnerabilities in Tibet. New Delhi must now strategically reposition the Sino-Indian dialogue, turning the spotlight squarely onto Tibet and asserting our legitimate interests there. These include border trade; religious linkages; people-to-people contacts; and the reopening of India’s consulate in Lhasa that was shut down in the 1950s. India’s regrettable abandonment of Tibet in 1950 and the abject surrender of the 1954 Panchsheel Agreement are now unchangeable history. But self-interest now demands a more realistic and assertive stance on Tibet.

Sunday, 18 March 2012

Army modernisation slow, navy & air force push ahead

IAF AN-32 transport aircraft supplying a forward location at India's Himalayan border.

by Ajai Shukla
Business Standard, 18th Mar 12

The defence budget for 2012-13 that was presented in parliament on Friday confirms the Indian Army’s degeneration into a low technology, manpower-intensive force that spends most of its money on day-to-day running, while the navy and air force are built up into modern, space-age forces.

Also evident from the figures is that inflation and the slide in the value of the rupee has caused the military’s modernisation budget to be effectively reduced for the first time in decades. Even more worryingly, India’s dependence on foreign weaponry could continue with R&D expenditure slashed in real terms.

This gloomy conclusion was not immediately evident when Finance Minister Pranab Mukherjee announced in parliament yesterday that the government had allocated Rs 1,93,407 crore for the military in 2012-13, a hike of 13.15% over the current year’s revised allocation of Rs 1,70,937 crore. The capital budget, which is the main source for the procurement of new weaponry, was raised by a seemingly healthy 15% from Rs 69,198 crore last year, to Rs 79,578 crore for 2012-13.

But a different picture emerges when one translates the capital budget into US dollars, import-dependent India’s primary currency for arms purchases. Last year’s capital budget (at Rs 44.45 per dollar on 1st Apr 2011) was $15.56 billion. This year’s capital budget (conservatively assuming an exchange rate of Rs 50 per dollar) translates into $15.91 billion.

“Factor in cost inflation, which is roughly 10-15% per annum for weapons systems, and this year’s capital budget will buy significantly less than last year’s,” points out G Balachander of the Delhi-based Institute for Defence Studies and Analyses.

The Defence R&D Organisation (DRDO), India’s main source of indigenous defence systems, must also make do with less. In rupee terms, the R&D allocation of Rs 4,640 crore for 2012-13 just about matches last year’s R&D spend of Rs 4,628 crore. But, given inflation and the falling rupee, and the high percentage of foreign parts in DRDO-built weaponry, the DRDO’s spending power will be significantly eroded during the coming year.

Another worrying issue is the army’s slowdown in modernisation. The navy will spend almost twice as much in the coming year on force modernisation as it will on manpower and running expenses (capital spend: Rs 23,882 crore, vis-à-vis revenue spend of Rs 12,548 crore). The IAF will be only slightly lower (capital spend: Rs 28,503 crore, vis-à-vis revenue spend of Rs 17,705 crore). In contrast the army will spend only Rs 13,803 crore (half the capital expenditure of the much smaller navy and IAF); while spending Rs 78,114 crore on running expenditure (roughly four times as much as the IAF and six times more than the navy).

“The army has always been a manpower-intensive force, given our mountain borders, but its fighting capability will be seriously eroded if modernisation is choked. The army badly needs new artillery, the helicopter fleet is obsolescent, there are hardly any serviceable attack helicopters, and night fighting capability remains a gaping hole. Most importantly, the infantry, which is operationally committed around the year, must be modernised urgently,” says Lieutenant General Pradeep Khanna, who retired last year as the chief of the army’s southern command.

A key reason for the IAF emerging as the biggest beneficiary of the capital budget is the expected signing of a contract this year for 126 Rafale medium multi-role fighters. Normally, about 15% of the overall price is paid at the time of signing; with the Rafale contract expected to be for around 70,000 crore, the IAF will pay some Rs 10,000 crore this year, with the balance distributed over the coming decade.

The IAF is also making annual payments for the earlier contracts for the American C-130J Super Hercules and C-17 Globemaster III transport aircraft. A contract could also be signed this year for 197 light utility helicopters, and for urgently needed trainer aircraft for rookie IAF pilots.

Similarly, the navy is budgeting for the impending contract for Project 17A frigates that will be built in Mazagon Dock Ltd, Mumbai (MDL) and Garden Reach Shipbuilders & Engineers Kolkata (GRSE). It is also making annual payments for several ongoing warship programmes: Project 28 anti-submarine corvettes being built by GRSE; and Project 75 Scorpene submarines, and Project 15A and 15B destroyers being built at MDL. In addition, it is paying Boeing for the P8I Poseidon multi-mission maritime aircraft (MMA) that are being built in the US.

On an average, more than two-thirds of any year’s capital budget is pre-committed towards annual instalments for defence contracts concluded earlier. Weapons platforms are often paid for over a decade or so. Just about 30% of any year’s capital budget goes towards new contracts.

Earlier this month, China had announced that it would spend $106 billion (670 billion Yuan) on its military in 2013. Defence experts estimate that Beijing actually spends 50-100% more than the declared figure. Like India, China too has steadily increased defence spending in line with its economic growth.

Wednesday, 7 March 2012

Travelling to Arunachal Pradesh... book research!

Leaving in a few moments for Arunachal, to one of the most beautiful spots on earth: Mechuka. This is a strategically important valley on the McMahon Line... and one of the areas that China's People's Liberation Army attacked and captured in 1962.

Photo of Mechuka attached for your viewing pleasure.

See you all in a couple of weeks!

Tuesday, 6 March 2012

Dragon soup for the Indian soul

(Photo: courtesy Ajai Shukla)
A view of the McMahon Line from Bomdi La

by Ajai Shukla
Business Standard, 6th Mar 12

On Sunday Beijing announced that it would raise defence spending this year by 11.2 per cent to 670 billion yuan (Rs 5.26 lakh crore). This is thrice India’s allocation of Rs 1.64 lakh crore for the current year, and one-fifth America’s allocation of $530 billion (Rs 26 lakh crore) for 2013. Many wonder how a rising and assertive superpower, with the world’s largest military in the People’s Liberation Army (PLA), gets away with allocating for national defence just 1.3 per cent of its national product. The answer of most China-watchers is that Beijing fudges the figures.

That is a comforting thought, Dragon Soup for the Indian Soul that has never quite recovered from the 1962 lambasting. But obsessing over Chinese perfidy blocks us from some badly needed analysis. Even if actual Chinese defence expenditure is twice the declared figure – the outer range of Pentagon estimations – that still begs the question: how is China building a world-class military (not there yet, but on its way) with so little? Even a defence spend of 2.6 per cent of GDP is relatively restrained.

This is all the more striking after President Obama threw down the gauntlet in January by announcing America’s “pivot” to the Asia-Pacific. China can hardly gloss over the challenge in its own backyard. Adding further to the pressure on Beijing for greater defence spending is the election climate in China. That country’s “fifth generation” of leaders will take power this autumn at the 18th National Congress of the Chinese Communist Party. Candidates who covet a seat in the all-powerful Politburo Standing Committee can hardly overlook the PLA’s backing.

Yet Beijing has reacted with a mere 11.2 per cent increase in defence spending. What on earth is Zhongnanhai doing, shriek the right-wing hordes in China’s blogosphere?

The answer is that China does more with less. Two crucial policies work to get more bang for the renminbi. Firstly, China’s national defence doctrine is rooted in truly national elements. In a conflict with America, Beijing will exploit the advantage of fighting close to home against an enemy hamstrung by extended lines of communication. Purpose-built PLA weapons like the Dong Feng 21D anti-ship ballistic missile will strike American aircraft carriers, the centrepiece of its armada. China is also perfecting cyber capabilities and satellite warfare capabilities to disable crucial US command systems, disrupting the application of focused US firepower. And the PLA is pioneering “swarm tactics” in which high-tech US fleets are swamped by hordes of cheap, small, expendable vessels. This indigenous, proactive doctrine is more effective and affordable than attempting to match a wealthier and technologically superior US weapon-for-weapon (although that option is not ruled out for the future).

Secondly, China has built an indigenous defence production capability that provides the PLA with weaponry cheaply and quickly. This has not happened by accident. Till the late 1990s China, like India, was a major buyer of overseas weaponry and a “catch-up country” in indigenous weapons development. During the last decade, though, Beijing’s focus on military indigenisation has transformed it into a major producer that is now a serious player in the global arms bazaar. This was achieved through the opportunistic recruitment of out-of-work Soviet scientists after the Soviet Union collapsed; by focusing on technology absorption; and by ruthlessly restructuring a moribund defence production behemoth (not unlike India’s defence public sector undertakings) into result-oriented, innovation-driven enterprises.

Indian planners show no such nimble-mindedness. Our national defence doctrine (so far as one exists!) assumes that a Chinese attack in 2012 would faithfully follow the script that Mao wrote half a century ago in 1962. In Arunachal Pradesh, Indian troop deployment centres on Tawang and Walong, China’s 1962 objectives, in the belief that difficult terrain precludes major offensives elsewhere. This is false, given China’s infrastructure build-up in Tibet. Even more worryingly, this defensive-mindedness cedes the initiative to the enemy, who is allowed to decide where and how to fight. Instead of shaping the battlefield to its advantage, as China plans to do with America, India aims merely to block China until international pressure halts the war. True, New Delhi plans to raise a mountain strike corps over the next five years that, it hopes, will take the battle to China. But islands of operational initiative cannot exist in a sea of defensiveness.

While India’s geographical disadvantages, stemming from its difficult mountainous terrain, are regularly compared with China’s easy operations on the Tibetan plateau, there is little recognition of China’s enormous difficulties in operating through a resentful Tibetan populace that seeks any opportunity to strike at Beijing. An Indian think tank recently recommended that the military should plan to leverage Tibetan partisans in the event of war with China. But such boldness, it would appear, is alien to our security planners. Even while planning war with China, there is fear of angering Beijing.

Meanwhile, India’s weapons procurement follows an even more depressing trend, evident from our shameful status as the world’s largest arms buyer. Just as India financed Russian R&D in the 1990s when Moscow was staring at bankruptcy (and when China was poaching their scientists and reverse-engineering weaponry), the continuing purchases of overpriced foreign platforms like the Rafale fighter will only breathe life into the R&D and production establishment of foreign countries instead of enhancing India’s indigenous capability. Indian success stories like the Tejas Light Combat Aircraft and the Arjun tank are criticised, held to an exalted standard, and eventually stalled by the Indian military — which fails to see the connection between its enthusiastic backing of French, Russian or American platforms and the failure of indigenous production.

There are many lessons that India can learn from China. Right up there is the need to indigenise defence strategy and production based on local advantages. That is the only way to confront a superpower.

Saturday, 3 March 2012

MoD announces the next Indian Army chief: Lieutenant General Bikram Singh

The MoD's press release, issued at 6 p.m. on Saturday, is pasted below

Lt Gen Bikram Singh will be the next Chief of Army Staff

New Delhi: Phalguna 13, 1933
Friday, March 03, 2012

The Eastern Army Commander, Lt Gen Bikram Singh, PVSM,UYSM,AVSM,SM,VSM,ADC has been designated as the next Chief of Army Staff, in the rank of General, with effect from the afternoon of 31 May 2012. He will succeed the present COAS, General VK Singh, PVSM,AVSM,YSM,ADC, who retires from the service on 31 May 2012.

Lt Gen Bikram Singh was commissioned into the Sikh Light Infantry Regiment on 31 March 1972.

During his long and distinguished career, spanning nearly 40 years, he has served in a variety of Command and Staff appointments. He has commanded a Corps in the Northern Command. The General had served as Deputy Force Commander of a multi-nation UN Peace Keeping Mission in Congo. He had also served as UN Observer in Nicaragua and El Salvador during the early 90s.

Lt Gen Bikram Singh has studied with distinction at the Defence Services Staff College, the Army War College and the US Army War College, Pennsylvania. He has also done M.Phil in Defence Management from the Indore University.

He is a recipient of PVSM, UYSM, AVSM, SM and VSM Awards. He is also one of the Honorary ADCs of the President of India.

He is married to Mrs Surjeet Kaur, housewife and the couple have two sons.

Friday, 2 March 2012

MoD slams door on private sector in submarine project

I took this photo last year at L&T's shipyard being built at Katupalli, near Ennore, Tamil Nadu. The yard, which is close to completion, marks L&T's emergence as a serious shipbuilder

by Ajai Shukla
Business Standard, 3rd Mar 12

The defence ministry (MoD) has ruled that no private sector shipyard in the country has the infrastructure and capability required for building the high-tech conventional submarines that the Indian Navy wants. The long-delayed Project 75I, to build six conventional submarines for an estimated Rs 30,000-35,000 crore, will be divided up between foreign shipyards and the defence public sector.

The Secretary Defence Production, Shekhar Agarwal, has told Business Standard that the ministry has decided that the first two Project 75I submarines will be built abroad by the foreign vendor that wins the MoD contract. The next four vessels will be built in India, in the two defence shipyards that have the infrastructure for building submarines: Mazagon Dock Limited, Mumbai (MDL); and Hindustan Shipyard Ltd, Visakhapatnam (HSL).

This decision is a blow to private sector shipyards, especially L&T, which is playing a major role in building the Arihant-class nuclear submarines; but also to ABG Shipyard and Pipavav Shipyard, which have invested lavishly on infrastructure. Three successive MoD committees have considered the thorny question of which shipyards can build a submarine. The latest, headed by V Krishnamurthy, Chairman of the National Manufacturing Competitiveness Council (NMCC), submitted a split opinion last year, which mentioned that L&T could also be considered.

“The MoD has examined the Krishnamurthy Committee report and decided that no private sector shipyard individually has the capability to build a submarine,” said Agarwal.

Contacted for a comment, L&T's defence business chief, MV Kotwal said "We have not been informed about any such development by the MoD. But if it is true, it is extremely surprising. We have informed the MoD already about the capabilities and capacities that we have put in place for submarine building. These have already been demonstrated in the Arihant project. L&T has the engineering and manufacturing capability needed for building submarines in India."

This decision was taken by the MoD’s apex Defence Acquisition Council (DAC) in January, says Agarwal. But, since it countermands an earlier CCS sanction, this will require sanction from the Cabinet Committee on Security (CCS). In 1999, the CCS had sanctioned the 30-Year Submarine Construction Plan for constructing 24 conventional submarines entirely in India. The latest MoD decision to build two submarines abroad runs contrary to this.

Business Standard has learned that the Indian Navy has argued forcefully for building the first two Project 75I submarines abroad. The navy hopes that this would forestall the delays that marred the ongoing Project 75, which involves constructing six Scorpene submarines in MDL, in partnership with Franco-Spanish consortium, Armaris (which was subsequently taken over by French shipbuilder, DCNS). The first Scorpene, which was to be delivered this year, will only be completed in 2015.

Top MoD sources apprehend that the CCS might be wary of okaying the proposal to build two submarines abroad. In 1999, the National Democratic Alliance (NDA) had regarded Indian shipbuilders capable of building 24 submarines in India. Thirteen years later, and with significant shipbuilding successes under its belt, including the indigenous production of a nuclear submarine, the CCS faces risks for any decision to build abroad?

The CCS also faces a difficult decision in sanctioning a fresh Transfer of Technology (ToT), which the navy insists upon. India has already obtained ToT thrice: from Germany for the HDW submarine line; from France, for the Scorpene; and, to an unclear extent, from Russia for the nuclear INS Arihant. The technology for Scorpene alone cost Rs 6000 crore. A fresh request for ToT risks accusations of failure in absorbing technology.

Senior naval officers who favour indigenisation point out that, when India bought the HDW Type 209 submarine in the 1980s, HDW built the first two submarines abroad. But the next two submarines, which were built in MDL, faced lengthy delays. Eventually, the MoD decided not to build any more, largely because of corruption allegations. Now the CCS will again have to recommend that construction model.

The MoD’s Acquisitions Wing is drafting a Project Note, which summarises these issues for the CCS. This effort has been under way for more than a month now.

The Scorpene is a 1,800-tonne submarine that can remain at sea for 40-50 days. A submarine traditionally lurks underwater, firing torpedoes to destroy enemy battleships. It dives as deep as 300 metres to evade detection, but its diesel-electric engines are not as silent, or have as much endurance, as the new “air-independent propulsion”, or AIP, that the navy wants in the new Project 75I submarines. India has an option to install AIP in the last two Scorpenes that MDL builds, and then retrofit AIP into the other four Scorpenes as well.

Thursday, 1 March 2012

Readying for defence: Eastern Air Command conducts Exercise Pralay

The MoD press release on Exercise Pralay is pasted below


New Delhi – March 01st , 2012

The IAF’s Eastern Air Command commenced Exercise codenamed “Pralay’ on 29th February 2012 in the Brahmaputra and rest of the Eastern region of India. The exercise involves joint Army Air operations by the IAF’s Eastern Air Command and Eastern Command of the Indian Army.

This is an annual exercise aimed at testing the combat potential of the Air Force in various roles such as Air Defence, Ground Support operations, Counter Air Operations, Electronic Warfare, Joint Operations with the Army including special operations by day and night. SU-30, Mirage-2000, MiG-29, Jaguar, Bison, Mi-17, AN-32, C-130J, AWACS, Flight Refuelling aircraft as well as remotely piloted aircraft from the Army are taking part in the exercise.

It also includes conduct of Special Forces operations and night operations in conjunction with ground forces during the exercise. The entire spectrum of Air Operations by aircraft under dense air defence environment is being practiced both by day and night. The exercise also includes facets of network centric operations, electronic warfare as well as information warfare.

Apart from war fighting in the skies various ground contingencies related to Air Force Operations are being tested. Lessons learnt from this exercise would be incorporated in future operational strategies. Eastern Army Command is actively taking part to train the forces in joint operations.