Tuesday, 17 September 2019

Limited choices in “Strategic Partners”



By Ajai Shukla
Business Standard, 17th Sept 19

Serious drawbacks were highlighted last week in the defence ministry’s so-called “Strategic Partner” (SP) model of procurement, when five Indian entities submitted Expressions of Interest (EoI) for being the SP in Project 75-I – the plan to build six conventional submarines for an estimated Rs 45,000 crore. There were two responses from the private sector – Larsen & Toubro (L&T) and Reliance Naval and Engineering (RNaval). Another two came from defence public sector shipyards – Mazagon Dock Ltd, Mumbai (MDL) and Hindustan Shipyard Ltd, Visakhapatnam (HSL). A fifth response came from a proposed special purpose vehicle (SPV) between HSL and Adani Defence, even though SPVs were not invited to bid. HSL thus submitted two bids, effectively competing against itself.

In many ways this mirrored the response to the only other SP procurement progressed earlier – for building 111 naval utility helicopters (NUH) for Rs 21,738 crore. In May, EoIs were received from L&T, TataAdvanced Systems Ltd, Adani Defence, Mahindra Defence, Reliance Defence and the Kalyani Group. Although the defence ministry solicited bids only from private firms, public sector Hindustan Aeronautics Ltd (HAL) also threw its hat in the ring, submitting two EoIs – one in its individual capacity and another in a joint venture with Russian Helicopters Ltd called Indo-Russian Helicopters Ltd (IRHL). The defence ministry has remained silent.

To understand how the SP model works, let us consider Project 75-I. The selected Indian SP will build the six submarines in technology partnership with a foreign “original equipment supplier (OEM) that is being chosen in a separate process. Four OEMs – Rubin Design Bureau (Russia), Thyssenkrupp Marine Systems (Germany), Naval Group (formerly DCNS, France) and Saab-Kockums (Sweden) formally responded to a “request for interest” the Indian Navy floated in October 2017. Since then, two more shipyards – Navantia (Spain) and Daewoo (South Korea) – have also indicated interest. Which of these six are actually in the fray will become clear on September 24, the last date for OEMs to submit EoIs. Then, after examining the SP and OEM proposals, the defence ministry will shortlist those it considers eligible. Shortlisted SPs will then pair up with approved OEMs to submit formal proposals. The defence ministry will award the contract to the SP-OEM pairing that it believes would build the submarines most cheaply, with the highest indigenous content and the most technology transfer. The aim is to equip the Indian defence industry with the skills and infrastructure to design and build the navy’s next 12 submarines without foreign help. Towards this end, Project 75-I proposes to incentivize OEMs who will deliver higher indigenous content than the minimum mandated level – which is 45 per cent in the first submarine, increasing to 60 per cent in the sixth.

However, somewhere along the way, the defence ministry has lost sight of what it intended to achieve – which was to nurture private defence firms that would compete on equal terms with the nine defence public sector undertakings (DPSUs) and the 41 factories of the Ordnance Factory Board (OFB) that monopolised defence production until 2001. In 2005-06, the Kelkar Committee recommended that technologically capable and deep-pocketed private firms be nominated Raksha Udyog Ratnas (RuRs, or Defence Production Jewels), each operating in a specific technology sphere. The RuR identified for fighter aircraft would compete with Hindustan Aeronautics Ltd (HAL). The RuR chosen for artillery guns would compete with the OFB. The chosen RuR for submarine building would compete with MDL.

Before long, this excellent initiative encountered push-back from OFB/DPSU trade unions, which feared job losses as manufacturing orders, hitherto handed to them on a plate, flowed instead to the more nimble and productive RuRs. Defence ministry bureaucrats, many of whom directly oversaw the defence public sector, also opposed competition from RuRs. Further, there was deep bureaucratic reluctance to be involved in selecting RuRs, especially after the decision-makers in the allocation of telecom spectrum and coal mining blocks faced corruption accusations. Consequently, for the duration of AK Antony’s defence ministership, the plan to pro-actively build up private defence manufacturers was put on the shelf.

In 2015, Manohar Parrikar, a defence minister who had once been an entrepreneur, resurrected a similar proposal, incorporating private sector SPs in place of RuRs. Two Parrikar-appointed committees – the Dhirendra Singh Committee and the VK Aatrey Task Force – set out stringent modalities for choosing SPs, including the financial and technical requirements companies were required to meet. But familiar resistance from bureaucrats and unions held Parrikar back until he relinquished charge as defence minister in March 2017. His successor, Arun Jaitley, took only weeks to announce an SP policy that entirely subverted its original aim. Jaitley allowed in OFB/DPSUs, forcing the private sector to compete with public sector entities that had been built up through decades of government largesse, including land, construction infrastructure, manpower skilling and technology transfer over multiple contracts awarded without tendering. Jaitley’s policy also diluted the domain competence needed to be an SP. A company no longer needed submarine building skills or “system-of-systems” domain competence to bid as an SP in a submarine project. Instead, it was enough to have commissioned, or owned a power, steel, chemical or automobile plant.

Besides the requirement for private companies to compete on unequal terms, there are other concerns about how Project 75-I is being pursued. Eyebrows have been raised over theentry of Adani Defence, which has neither a shipyard nor any shipbuilding experience; its participation rests on the parent Adani Group’s power plant. Since dry docks, wet basins and outfitting berths are essential for building submarines, Adani Defence relies on its SPV with HSL to meet those EoI conditions. But the rules demand that a bidding company must exist on the date the EoI is submitted – the Adani-HSL entity apparently does not. Nor is HSL eligible to bid alone, since it neither meets the EoI’s financial criteria (turnover and net worth), nor has it delivered a platform worth Rs 300 crore in the last five years.

Project 75-I starkly underlines the ambitions of Adani Defence, which, despite never having manufactured a single defence item, is on track to contend in all the four SP procurements planned. It is already participating in the NUH project and Project 75-I. Having tied up with Saab of Sweden, Adani will almost certainly pitch for the forthcoming SP tender for building 114 fighters in India. That leaves only the project for building tanks and, given the stakes Adani has picked up in tank electronics firm Alpha Design Technology, armoured vehicles seem to be in its crosshairs too.

The Reliance Group seems equally focused, despite the Rafale controversy, RNaval’s severe financial woes and a looming corporate insolvency process under the Indian Bankruptcy Code. RNaval might shelter behind its parent group’s financials, but Reliance Infrastructure’s poor liquidity and a credit rating of ‘D’ severely dents its prospects to qualify. Intriugingly, the defence ministry has diluted the credit rating requirement in its EoI request. The Defence Procurement Procedure of 2016 requires a credit rating of “A” for projects worth Rs 1,000 crore. The EoI request dilutes it to “BBB” for a project worth 45 times more. The logic behind this could be interesting.

Finally, timely delivery is everyone’s bugbear, except for L&T which is delivering vessel after vessel ahead of schedule. RNaval is years overdue in delivering patrol vessels to the navy. HSL was years late in overhauling a navy Kilo-class submarines. MDL is years late in delivering the Scorpene submarines under Project 75. It would seem the defence ministry is not spoilt for choice.

Saturday, 14 September 2019

Navy Tejas fighter conducts landmark “arrested landing”

Video of the first arrested landing by a Naval Tejas fighter

By Ajai Shukla
Business Standard, 14th Sept 19

On Friday, India took a giant step towards designing and building a Tejas fighter capable of operating off aircraft carriers, when a Tejas prototype fighter carried out an “arrested landing” in the navy’s Shore Based Test Facility (SBTF) in Goa.

Even air force pilots accept that the most dangerous and spectacular flying mission is one that naval fighter pilots perform every day: landing a fighter on an aircraft carrier deck, which is often just 200 metres long.

Such a landing is only possible if the pilot can successfully snag a “tail hook” on the tail of the aircraft onto a series of “arrestor wires” on the aircraft carrier’s landing deck. The wires then unspool, dragging the aircraft to a halt.

That is what Commodore Jaideep Maolankar, flying a naval Tejas prototype developed by the Defence R&D Organisation (DRDO), demonstrated on Friday on a land-based airstrip, with the aircraft absorbing the huge deceleration stresses. This opens the door to actually landing the Tejas on an aircraft carrier, and thence to introducing the fighter into operational service.


 "Today is a golden letter day in the history of Indian naval aviation. This has put India on the world map as a nation with the capability to design a deck landing aircraft,” said a DRDO official who briefed the media after the event.


To be sure, the naval Tejas is still a long way from operational service. The navy has stated that the Tejas Mark 1’s current General Electric F-404IN engine is not powerful enough. This means that the navy will wait for the Tejas Mark 2, which will be powered by the peppier GE F-414 engine.


Yet, a small but highly motivated team of designers, flyers and technicians at the Aeronautical Development Agency (ADA), the DRDO agency responsible for the Tejas, are continuing to develop the Naval Tejas Mark 1 as a prototype for perfecting key elements needed for carrier deck operations – such as a rugged undercarriage that can absorb the impact of the aircraft with the landing deck.

This has been a delicate process, in which designers must strike a balance between weight, strength, speed, maneuverability and other flight aspects. For example, strengthening the fighter’s undercarriage adds weight, which reduces speed, climb rate and turning radius.

“Over multiple iterations over a sustained period, we have balanced these aspects in the naval Tejas. This has resulted in our developing a body of priceless technical experience and knowledge. Today’s achievement is not so much about developing an aircraft, as it is about building up a team of designers that will form the backbone of Indian naval aviation design in their working lifetime,” said a senior ADA official on Friday.


 The Naval Tejas flight test team that executed the landing will remain in Goa over the next month, consolidating the experience and conducting further testing.


Of the total budget of Rs 14,047 crore sanctioned for the Tejas project, the naval fighter has been sanctioned Rs 3,650 crore. Of that amount, Rs 1,729 crore has been allocated for the naval Mark 1 fighter, while Rs 1,921 crore is earmarked for the Naval Tejas Mark 2.

Wednesday, 11 September 2019

Indian defence SME beats out global giants to deliver command system to Malaysian warships

C2C DB has developed a new-generation CMS for two Malaysian Navy frigates, including KD Jebat (pictured here) and KD Leiku

By Ajai Shukla
Business Standard, 11th Sept 19

On Monday, the Royal Malaysian Navy (RMN) cleared a combat management system (CMS) that a small, but cutting-edge, Indian electronics company has developed for two of its frontline warships – the British-origin RMN frigates, KD Leiku and KD Jebat.

A warship’s CMS is the brain of its combat capability. The CMS continuously interacts with all the ship’s sensors and weapons – including radar, sonar, missiles, rockets and torpedoes – and assesses the threats that they detect. Then, the CMS suggests weapons to neutralise the threat; and it fires and controls those weapons. 

In addition, the sophisticated CMS software collaborates with friendly warships’ command systems over a real time datalink. This develops a “common operating picture” for fleet operations.

Validating the truism that high-technology is mostly developed by micro, small and medium enterprises (SMEs), C2C DB Systems is the only Indian firm that has developed a complete CMS, including tactical datalink capability and warfighting modules (which navies guard zealously). 

For example, the Indian Navy’s warfighting modules are developed secretly by an in-house department called the Weapon and Electronics Engineering Establishment (WESEE). The CMS’ supporting modules are developed by companies like Bharat Electronics Ltd and Tata Power (Strategic Engineering Division).

C2C DB Systems is based in Bengaluru and has a total strength of 50, including senior management, hardware and software engineers and mechanical design engineers. Its annual turnover is around Rs 25 crore.

Yet, this small firm partnered with a Malaysian firm, Marine Crest Technologies, to wrest the tightly contested RMN contract from global competitors such as Thales of France, Saab of Sweden and UK-headquartered BAE Systems.

RMN placed the order for the two CMSs and tactical datalink systems in April 2018, stipulating a delivery period of just nine months for the first system. Typically, developing a similar system in India takes about two years. 

With C2C DB demonstrating the complete functionality of the CMS and datalink  during “factory acceptance trials” in January 2019, and the system shipped to Malaysia the next month, C2C DB Systems became the only Indian entity to have developed a complete CMS, along with a tactical datalink. It is also the only Indian entity to have exported such a system.

The complete system was installed on board the first RMN frigate in March, after being fully integrated with the warship’s weapons and sensors. “Harbour acceptance trials” of the tactical datalink were unconditionally cleared on Monday, while CMS trials are under way. Next will come “sea acceptance trials” at the end of this month. 

C2C DB Systems is tightly integrated into India’s warship production eco-system. It has worked with WESEE to develop the complete front-end software for the CMS of India’s first indigenous aircraft carrier, INS Vikrant. It has also done classified work for the nuclear missile submarine, INS Arihant.

Tuesday, 10 September 2019

IAF chief “resurrects” his former squadron to receive the Rafale

Air Chief Marshal BS Dhanoa resurrects his old squadron to receive the Rafale fighter


By Ajai Shukla
Business Standard, 10th Sept 19

Indian Air Force (IAF) chief, Air Chief Marshal BS Dhanoa, who retires from service in another 20 days, has given the kiss of life as a parting present to the squadron he commanded during the Kargil War.

On Tuesday, at a solemn ceremony in Ambala, Dhanoa formally “resurrected” Number 17 Squadron, also known as the “Golden Arrows”, which was retired from the active list five years ago when its MiG-21Ms were phased out of service.

The resurrected Golden Arrows will be the first IAF squadron to be equipped with the Rafale fighter, which French firm Dassault is scheduled to begin supplying this month. This Rafale squadron will be based in Ambala and operationally committed to the India-Pakistan frontier.

“In the near future, 17 Squadron will be the first squadron to be equipped with the state of the art Rafale aircraft, which is an extremely capable, fourth generation, multirole aircraft with advanced weapons,” announced the IAF on Tuesday.

The IAF also plans to resurrect another former MiG-21 squadron, 101 Squadron or the “Falcons”, which too was “number-plated” (removed from the active list, and its identity mothballed for future use) some years ago when its MiGs become too old to fly. 101 Squadron, the second Rafale squadron, will be based in Hashimara to operate on the Sino-Indian front.

17 Squadron has an illustrious combat history. It was formed at Ambala in 1951 and was equipped with the Harvard-II B fighter. In 1957, it converted to the Hawker Hunter fighter, which it flew with distinction in the 1971 war, winning numerous gallantry awards. 

The Squadron converted to the Mig-21 M in 1975. Under the command of then Wing Commander BS Dhanoa, the squadron distinguished itself in Operation “Safed Sagar”, as the IAF termed the Kargil conflict of 1999.

Sunday, 8 September 2019

HAL-built trainer aircraft HTT-40 clears crucial “six-turn spin test”

With the import-addicted IAF insisting on imported Swiss trainers, HAL has funded the HTT-40 with its own money

By Ajai Shukla
Business Standard, 8th Sept 19

Hindustan Aeronautics Ltd (HAL) has underlined its growing capability to design and develop fixed wing aircraft by steering its home grown Hindustan Turbo Trainer – 40 (HTT-40) basic trainer to the brink of final flight clearance.

In flight-testing on Saturday in Bengaluru, HAL’s test pilots threw the HTT-40 into multiple spins and, each time, the trainer returned to level flight smoothly. In so doing, the HTT-40 cleared the so-called “six-turn spin test”, regarded as the ultimate and most difficult test for a prototype aircraft.

The HTT-40 has already met and, in many aspects of flight performance, surpassed the so-called “Air Staff Qualitative Requirements” (ASQRs), which lists out the flight performance – speed, turn, ceiling, etc. – that the IAF demands from an aircraft. 

Since 2012, the Indian Air Force (IAF) has consistently opposed the HTT-40, first pressuring the Ministry of Defence (MoD) into importing 75 Pilatus PC-7 Mark II basic trainers from Switzerland, and then demanding more imports because HAL would allegedly never be able to steer the HTT-40 through all its tests.

“There is no need for [the HTT-40 trainer]”, then IAF boss, Air Chief Marshal NAK Browne, had dismissively stated at the Aero India show in 2013. “We have the Pilatus PC-7. It’s a proven aircraft. The project HAL plans is from scratch. Our indications are that the cost will be too high. There is no need for all this.”

Each successive IAF chief followed the same line, criticizing the HTT-40, while demanding more Pilatus imports. As Business Standard reported (June 10, 2019, “IAF block on indigenous HTT-40 trainer aircraft keeps door open for Swiss trainers”) the current IAF chief refused to even issue a tender for the HTT-40, which was needed to procure engines for the production aircraft. The IAF stated it would only do so after the HTT-40 cleared the six-turn spin tests.

HAL has responded to IAF opposition with defiance. Successive HAL chiefs backed the HTT-40, committing Rs 350 crore of internal HAL funds to the project. A team of young, talented HAL designers have worked without IAF assistance or funding, backed to the hilt by former defence ministers, AK Antony and Manohar Parrikar. 

For the Pilatus PC-7 Mark II trainer, the procurement of which is already under the scanner of the Central Bureau of Investigation, this most likely spells the end of further imports. The HTT-40 falls under the category of “Indian designed, developed and manufactured” (IDDM) equipment, and the MoD cannot import more Pilatus without a detailed explanation of why the HTT-40 is being ignored.

“For HAL, clearing the HTT-40’s six-turn spin tests removes a monkey from our backs. Our intermediate jet trainer (IJT) aircraft had failed its spin tests and we were determined this would not be the fate of the HTT-40. In fact, not just has the HTT-40 cleared its spin and stall tests, we have revived the IJT project as well,” said HAL’s design chief, Arup Chatterjee.

HAL has manufactured the IAF’s fleet of Hawk advanced jet trainers (AJT), with technology from BAE Systems. With the HTT-40 poised for final clearance, a breakthrough on the IJT could mean that the IAF’s entire training aircraft fleet comprises of HAL-built aircraft.

Friday, 6 September 2019

MoD to release revised Defence Procurement Procedure (DPP) by March

The MoD's procurement chief, Apurva Chandra, is chairing the committee that is revising the Defence Procurement Procedure

By Ajai Shukla
Business Standard, 6th Sept 19

The ministry of defence (MoD), which has been criticised for its cumbersome and slow procurement, is evolving reformed procedures to make defence tendering and contracting simple, flexible and quick.

The MoD’s procurement head, Apurva Chandra, told an aerospace industry gathering in Delhi on Thursday: “An empowered committee has been instituted to review the Defence Procurement Procedure (DPP 2016) and the Defence Procurement Manual (DPM 2009) [and] to release revised versions of both documents by March 2020.” 

The DPP stipulates the procedure for buying weapons and equipment from the defence capital budget, whereas the DPM governs acquisitions from the defence revenue budget. The former is regarded as the procedure for “equipment modernization”, while the latter is the procedure for “running expenses”.

DPP-2020 will be the eighth revision of a procurement procedure that was first formalised in 2002. Successive defence ministers, most recently Manohar Parrikar, vowed to make it shorter and more flexible. However, the DPP has only grown wordier and more process oriented, rather than outcome oriented.

Chandra stated that he was chairing the empowered committee in his capacity as Director General (Acquisitions). Under him, there would be three specialised subcommittees for reviewing various aspects of the DPP.

The “Subcommittee on Air Systems”, chaired by the Indian Air Force (IAF) deputy chief, Air Marshal VR Chaudhari, would evolve a better procedure for purchasing aircraft.

The “Subcommittee on Trial and Testing”, chaired by Air Marshal Rajeev Sachdeva, would simplify and improve the processes of equipment trials, which have often taken years to conclude.

The third subcommittee chaired by Chandra himself, would integrate all acquisition processes such as Make-1, Make-2, iDEX and procurements from the Technology Development Fund (TDF) into a unified, common procedure.

Chandra also said his subcommittee would consider including a separate chapter for information and communication technology (ICT) projects in the revised DPP. 

“The subcommittees will be inviting industry to deliberate and seek their inputs to formalise the DPP and DPM.  A draft DPM has already been shared with industry for their feedback”, stated the Confederation of Indian Industry, which organised the aerospace seminar. 

The Director General (Acquisitions) also revealed that some important contracts would fructify in the next few months. This includes a Rs 5,500 crore contract for the indigenous Akash air defence missile, which Bharat Electronics Ltd is building. 

In addition, the MoD’s negotiating committee for buying 83 Tejas fighters from Hindustan Aeronautics Ltd (HAL), has finalised the per aircraft price two days ago. Negotiations are now centred on the cost of “life cycle support” for these aircraft. The contract is likely to be signed in the next three-to-four months, said Chandra.

Meanwhile, negotiations with HAL for procuring the indigenous Light Combat Helicopter are making progress and a contract could be three-to-four months away, he said.

Thursday, 5 September 2019

Russia, already India’s biggest arms supplier, has more deals in its sights

$12 billion worth of “Make in India” projects in hand, Moscow eyes $25 billion more

By Ajai Shukla
Business Standard, 5th Sept 19

On the eve of his two-day visit to Vladivostok for a summit meeting with President Vladimir Putin, Prime Minister Narendra Modi proposed combining Russia’s high technology with India’s low production cost to build weaponry more cheaply. This is already happening, with contracts worth over $12 billion in the pipeline.

In March, the Stockholm International Peace Research Organisation named Russia as India’s biggest arms supplier from 2014-18, accounting for 58 per cent of India’s defence imports. While no big defence announcements are slated for Modi’s visit on Wednesday and Thursday, a slew of “Make in India” contracts could ensure Russia holds its position in the years ahead.

These projects are over and above the $5.43 billion contract for five units of the S-400 Long Range Surface to Air Missile System, which was announced at the last Modi-Putin summit last October. 

Kamov 226T helicopters

In 2015, on Putin’s personal request, Modi agreed to buy 200 Kamov-226T utility helicopters for the IAF and army without competitive tendering. The $2 billion deal involves building 140 Kamovs in Hindustan Aeronautics Ltd (HAL), after its joint venture (JV) partner, Russian Helicopters, supplies the first 60, fully built.

With this in hand, Russian Helicopters is fielding a “navalized” Kamov-226T in the Indian Navy’s tender for 111 “naval utility helicopters”. With its production facilities amortised over the first 200 Kamovs, Russian Helicopters could offer the navy a compelling price of around $1 billion.

Kalashnikov AK-203

New Delhi and Moscow have signed an inter-governmental agreement (IGA) to build 750,000 Russian assault rifles for the Indian army, at a likely cost of about one billion dollars. In March, Modi inaugurated an Indo-Russian JV in Korwa, near Amethi, which will soon start manufacturing Kalashnikov AK-203 rifles.

The JV includes the Ordnance Factory Board, with a 50.5 per cent majority stake; Kalashnikov, with a 42 per cent stake, and Russia’s state-owned export agency, Rosoboronexport, owning the remaining 7.5 per cent.

Krivak-III frigates

In October 2018, the cabinetapproved the purchase of four Russian Krivak-III class frigates. The first two frigates are lying partially built in Yantar Shipyard, Russia and India will pay about $1.5 billion to complete them, install Ukrainian Zorya gas turbine engines and sail them to India. 

Meanwhile, a contract is being negotiated to build the next two Krivaks in Goa Shipyard Ltd.

India already operates six Russian Krivak-class frigates. The first three, INS Talwar, Trishul and Tabar, were commissioned in 2003-2004. Subsequently, INS Teg, Tarkash and Trikand, were commissioned in 2012-2013.

BrahMos missiles

The BrahMos missile, which India and Russia co-developed and now co-produce in Hyderabad, is on order for several Indian warships. Last December, the MoD announced that the BrahMos would arm the four new Krivak-III frigates. Each vessel’s BrahMos system, including the “vertical launch system” and missiles on board, will cost Rs 1,250 crore ($175 million).

BrahMos missiles are also on order for the navy’s four Visakhapatnam-class destroyers and will equip the seven Project 17A frigates under production. The total cost amounts to about $2.6 billion.

Igla-S

Last November, the ministry of defence (MoD) announced it had chosen Russia’s Igla-S missile as the “very short range air defence system” (VSHORADS) for the army, navy and Indian Air Force (IAF).

Russia’s export agency, Rosoboronexport (ROE) bid $1.5 billion for 5,175 Igla-S missiles and 800 launchers, beating out Sweden’s Saab and French firm, MBDA.

The Igla-S VSHORADS, with a range of eight kilometres, will protect soldiers from enemy combat aircraft that have sneaked through the IAF’s defences. While the Igla-S is an older system, with even the Russian military having switched over to the 9K333 Verba, it presents an affordable option.

Sukhoi-30MKI

With Hindustan Aeronautics Ltd (HAL) Nashik completing delivery of its contract to build 222 twin-engine, heavy Sukhoi-30MKI fighters, negotiations are under way for extending the licence to build an additional 18 aircraft.

At HAL’s price of about Rs 450 crore ($65 million) for each Sukhoi-30MKI, the IAF will pay about $1.15 billion for 18 new fighters. Delivery of these could start next year and be completed by 2022, increasing the IAF’s Su-30MKI fleet size to 14 squadrons, or 290 fighters.

* * * *

Firm agreements between Moscow and New Delhi underlie the $12.25 billion worth of Make in India production mentioned above comprise of. However, the real money lies in three procurements that Russia hopes to corner. These include:

Project 75-I submarines

Rosoboronexport is pursuing a navy tender, worth some Rs 50,000 crore ($7 billion) for six new submarines, with “air independent propulsion”, under Project 75-I. 

The navy’s 30-year submarine plan calls for building 12 vessels with foreign technology, and the next 12 indigenously. So far, only six Scorpene submarines have been built and Project 75-I is the last chance to obtain foreign technology.

Russia has promised a high degree of technology transfer for building its Amur-class submarines in India. It is competing for the contract with Thyssenkrupp Marine Systems from Germany, Naval Group from France and Kockums from Sweden.

Medium fighters

After the 2004 tender for 126 “medium multirole combat aircraft” (MMRCA) was aborted with the purchase of 36 Rafale fighters from Dassault, the IAF initiated a fresh acquisition for 114 medium fighters. Two Russian fighters are competing – the MiG-35 and Sukhoi-35.

Meanwhile, last year the navy initiated the procurement of 57 multi-role carrier borne fighters for its two indigenous aircraft carriers. The MiG-35 is competing for this too.

These are easily the biggest on-going Indian procurements, together worth an estimated $18-25 billion. The Make in India component amounts to 50 per cent of the contract value

However, an obstacle to India’s defence contracts with Moscow is an American law – Countering America’s Adversaries Through Sanctions Act (CAATSA). This binds Washington to impose sanctions against countries that engage in “significant transactions” with Russian, Iranian and North Korean entities. While President Donald Trump can grant New Delhi a waiver from CAATSA, there is no certainty that he would.

Tuesday, 3 September 2019

IAF gets its first Apache helicopters, army aviation stakes its claim










By Ajai Shukla
Business Standard, 3rd Sept 19

Providing the Indian armed forces with a badly needed firepower boost, The Boeing Company formally handed over eight Apache AH-64E armed attack helicopters to the Indian Air Force (IAF) at Pathankot on Tuesday. 

These are the first of 22 Apaches that will equip two IAF attack helicopter squadrons that have, so far, flown Russian-origin Mi-25 and Mi-35 attack helicopters. The first to fly the Apache will be Pathankot-based 125 Helicopter Unit, named “Gladiators”. Next up for the Apache will be 104 Helicopter Unit, based in Suratgarh, Rajasthan.

Both these Apache units are scheduled to be fully equipped and operational by end-2020. “I am happy to note that the delivery schedule is on time with eight helicopters already being delivered,” said IAF chief, Air Chief Marshal BS Dhanoa, at the handing-over ceremony in Pathankot.


The Apache, especially its latest, and most advanced, variant called the AH-64E, is widely respected as the world’s most formidable attack helicopter. Sixteen countries have bought more than 2,000 Apaches since the initial variant entered service in the early 1980s.

The United Progressive Alliance (UPA) government initiated the procurement of 22 Apaches, while the current government signed the $1.4 billion contract in September 2015. 

The Apache is primarily designed to provide fire support to ground forces, including to infantrymen who can manpack only limited weaponry, especially in the mountains; and to mechanised units that have pinned down enemy tanks frontally, setting the stage for Apaches to fly in from the flanks, hidden by tree lines or sand dunes, and set enemy tanks ablaze with missiles and rockets.

The Apache is the world’s most lethal tank killer, firing Hellfire missiles from a distance of four-to-five kilometres – too far for the tanks to engage the Apache accurately. To destroy enemy unmanned aerial vehicles (UAVs), attack helicopters or even fighter aircraft, the Apache mounts AIM-92 Stinger missiles on its stub wings. For ground targets, it carries 70 millimetre Hydra rockets and a 30-millimetre chain gun. All these weapons are integrated through the vaunted Longbow fire-control radar, which is carried by every second Apache.

“Alongside these capabilities… it also has modern electronic warfare capabilities to provide versatility to helicopters in network centric aerial warfare. These aircraft have been modified specifically to suit the exacting standards demanded by the IAF,” said Dhanoa.

There is deep conflict, however, between the IAF and the army over who should fly the Apache. While the IAF flew the Mi-25 and Mi-35 attack helicopters, the army argues that such support assets, which are directly employed in the tactical ground battle, should be flown and operated by army pilots who understand the ground battle.

The army cites the employment of attack helicopters in the US context, where Apache units are a part of the US Army. This is also true of most other evolved militaries such as the British Army.

The IAF, however, cites precedent. Initially, the IAF operated all flying platforms, including light helicopters such as the Chetak and Cheetah that flew only passengers and medical evacuation sorties. That began changing in the 1980s and 1990s, when the Army Aviation Corps was raised and took over charge of light helicopters. The army’s role gained momentum with the induction of the indigenous Dhruv chopper, and its armed version, the Rudra, both of which the army has inducted in numbers.

The army also took a stake in India’s first indigenous attack chopper, the eponymous Light Combat Helicopter (LCH), which is nearing completion. “The Rudra and LCH are basically army platforms, since they must be integrated to provide fire support to army operations. The same is true for the Apache, especially in mechanised warfare,” says a former army lieutenant general, who headed the Army Aviation Corps.

This logic has been acknowledged in the defence ministry. Negotiations are currently underway for another six Apache AH-64Es for the Army Aviation Corps.

The IAF argues that the Apache is not just a battlefield support platform, even though an official release on Tuesday mentions that its procurement “will enhance the capability of IAF in providing integrated combat aviation cover to the army strike corps.” Air force planners argue that Apaches could mount “shallow surgical strikes” across the Indo-Pakistan frontier; and that the attack helicopter could fly low-level strikes on Pakistan’s air defence radar network, in order to clear an “electronic safe path” for IAF strike fighter to fly safely to strike deeper-lying targets.

Other planners counter that such missions were possible only in highly asymmetric wars, such as the Gulf Wars, where the absence of a well-developed Iraqi radar network allowed US Army Apaches a free run. Pakistan, which has a sophisticated radar and air defence network, would be able to detect the Apaches and engage them effectively, it is argued.

Monday, 2 September 2019

IAF chief, Dhanoa, flies farewell sortie with Balakot hero, Abhinandan Varthaman













By Ajai Shukla
Business Standard, 3rd Sept 19

Indian Air Force (IAF) chief and veteran MiG-21 pilot, Air Chief Marshal BS Dhanoa, who will retire this month, flew his farewell sortie on Monday in a MiG-21 BISON fighter, with Wing Commander Abhinandan Varthaman as his co-pilot.

As the MiG-21 accelerated down the Pathankot Air Base runway for its notoriously fast take off, the sortie was laden with symbolism. Dhanoa and Varthaman are amongst the few IAF pilots who have flown combat missions against Pakistan -- Dhanoa during the 1999 Kargil conflict and Varthaman on February 27, the day after the IAF strike on Balakot, in Pakistan. Both pilots have experienced ejection by parachute from their stricken MiG-21s. Finally, in a tradition-bound military where sons often follow their fathers into service, Dhanoa has flown extensively with Varthaman's father – himself an air marshal who retired recently.

“I’ve flown with his (Varthaman’s) father. It’s an honour for me to do my last sortie in an IAF fighter aircraft with his son,” said Dhanoa after the sortie.

Varthaman was cleared to return to operational flying a couple of months ago, after recovering from injuries sustained during his ejection over Pakistan Occupied Kashmir (POK). Varthaman was captured by Pakistani ground troops and released unharmed two days later.

His gallantry in combat and in Pakistani captivity brought him the award of a Vir Chakra on Independence Day. The IAF claims that, before Varthaman was shot down, he shot down a Pakistan Air Force (PAF) F-16 fighter.

While the PAF denies the claim, it would be a creditable achievement for a MiG-21, a four decade-old, Soviet-era fighter, to shoot down an F-16 – the PAF’s premier combat aircraft.

During his tenure as IAF chief, Dhanoa – who is regarded as a “flyer’s flyer” – has flown several sorties in the MiG-21, to bolster confidence in the IAF’s oldest fighter. While it is not unknown for senior air marshals to fly ceremonial sorties as co-pilots in the rear seat of fighters, with the aircraft actually being flown by a younger frontline pilot, Dhanoa often captains the sortie himself.

In Pathankot today, Dhanoa took the pilot’s front seat and flew the entire sortie, while Varthaman occupied the co-pilot’s rear seat.

Notwithstanding Dhanoa’s forthright advocacy of the MiG-21, the fighter has only a short tenure left in service. There are just four-to-five squadrons remaining in service (each squadron has about 20 aircraft), and they are likely to be phased out by 2022-23. They are to be replaced by the Tejas light combat aircraft, but the Tejas production line cannot yet manufacture the fighter in the numbers that are required.

The retirement of the MiG-21 fleet is likely to see the IAF’s fighter strength dropping below 30 squadrons, against the 42 squadrons it is authorized.

Sunday, 25 August 2019

Ordnance Factory workers end strike, MoD to review “corporatisation”

OFB officers wonder how "corporatisation" will more than double the turnover of ordnance factories

By Ajai Shukla
Business Standard, 25th Aug 19

Ordnance Factory Board (OFB) workers’ unions have called off a strike, launched on August 20, to protest against the Ministry of Defence’s (MoD’s) decision to “corporatize” the 41 ordnance factories. The unions have asked OFB employees to re-join work on Monday.

“Corporatising” the OFB involves converting what is currently a department of the MoD that produces tanks, guns and ammunition, into a defence public sector undertaking (DPSU). That would require the OFB to maintain a balance sheet and a profit and loss account, with transparency about inputs, production costs and salaries.

The MoD believes that corporatizing the OFB will increase annual turnover from the current Rs 14,000-16,000 crore to above Rs 30,000 crore by 2025. The unions counter that turnover is not in their hands, since it depends wholly upon the orders placed by the army.

Consequently, some 60,000 of the OFB’s 76,000 workers struck work since August 20, in accordance with a strike notice issued on August 1. The OFB’s 1,500 Class “A” officers continued attending office, while about 6,000 “junior works managers” were not a part of the strike, but did not come to work.

The decision to call off the strike follows several rounds of meetings between the unions and the government, represented by the Secretary of Defence Production (Secretary DP) Ajay Kumar. A breakthrough was achieved on Friday, when the government agreed to review the question of corporatization.

On Saturday, a circular issued by the employees’ unions stated: “After considering the statement/assurance of the Secretary DP that no final decision has been taken yet about converting the OFB into a corporation and that a high level official committee will be constituted by the government… employees will resume work from 6 a.m. of 26/08/2019.”

Business Standard has reviewed the minutes of the MoD’s Friday meeting with the unions, in which the government assured the unions that “the matter regarding corporatization of OFB is under examination… [and] that no final decision has been taken by the government in this regard. It was therefore agreed to recommend setting up of a High Level Official Committee (sic) to interact with the Federations and make suitable recommendations to the government.”

OFB employees worry that corporatisation could trigger mass layoffs or salary cuts. There are also concerns about what pensions they would be paid, with all post-2004 employees covered under the New Pension Scheme.

Addressing the OFB employees’ key concerns, the MoD minutes stated: “The meeting recognized some of the concerned raised by employees federations regarding how the benefits/interests of employees in terms of wages, health facilities and other service matters etc. may be affected by converting OFB into a public sector entity.

OFB union sources point out that they conducted themselves responsibly. To prevent damage to tooling and inventories during the planned month-long strike, workers grease-packed equipment and machinery. Several thousand employees involved in essential services like electricity and water supply and fire fighting, were allowed by the unions to come to work.

While the OFB’s Class “A” officers were not part of the strike, they wrote a memorandum to the prime minister through their union, the Indian Ordnance Factories Service Officers’ Association (IOFSOA) on August 3. This pointed out that the OFB constituted a “war reserve” that could leverage surplus production capacities to quickly ramp up production in the event of war. Before the Kargil war began, OFs were producing ammunition worth Rs 700-800 crore annually. Faced with crisis, the OFB ramped up production to Rs 2,200 crore.

The PM was also told that ramping up production from the current Rs 14,000-15,000 crore to Rs 30,000-35,000 crore by 2024-25 would require large annual increases in the army’s budget, failing which it would be unable to absorb this enhanced production.

The IOFSOA letter to the PM also rebutted the notion that OFB products are overpriced. “OFB is highly competitive when compared with international prices. To quote a few: T-90 tank, AK-630M naval gun… OFB prices are less by 25-100% as compared to international prices. This is substantiated by international bidding in which OFB has participated,” it stated.

Multiple unions, including the Bharatiya Janata Party-affiliated Bharatiya Pratiraksha Mazdoor Sangh, represented the OFB employees. The others were the Left Front-affiliated All India Defence Employees’ Federation, and the Congress-affiliated Indian National Defence Workers’ Federation. They came together under the umbrella of the Confederation of Defence Registered Associations.

Friday, 23 August 2019

Editorial comment: Old can be gold

Combat aircraft with upgrades remain in service for many decades

By Ajai Shukla
Editorial in Business Standard
23rd Aug 19

The government must take seriously Indian Air Force (IAF) chief, Air Chief Marshal BS Dhanoa’s recent lament that the IAF was still flying 44-year old MiG-21 fighter jets, a vintage far older than the cars that people currently drive. With Defence Minister Rajnath Singh listening on, this was an unmistakeable indictment of the defence ministry’s tardy procurement system, which compels the IAF to make do with just 29 squadrons of fighter aircraft, against the 42 that defence planners say the country needs. The IAF will have to manage with even fewer squadrons, because the MiG-21 fleet will retire soon, and only a handful of Rafale, Sukhoi-30MKI and Tejas Mark 1 fighters would be inducted in their place. Further, as this newspaper has reported, the IAF has decided against extending the service life of four Jaguar squadrons, which means even more fighters will become due for retirement. The defence ministry has commenced the purchase of six more fighter squadrons but, going by past experience, they could take a decade-and-a-half to come. All of this was foreseeable, but has still come to pass.

Notwithstanding the real crisis in fighter numbers, the IAF chief’s complaint does not reveal the full picture, which is that combat aircraft routinely remain in service for many decades. The US Air Force, unarguably the world’s most cutting edge, continues to fly several aircraft that are over half a century old. The B-52 bomber has been in service more than 60 years, and the KC-135 Stratotanker has been refuelling American fighters for over half a century. The T-38 Talon supersonic trainer has trained close to 60,000 US pilots over the last fifty years.

The IAF should know this, since it is procuring American combat aircraft that have crossed the half-century landmark. The CH-47 Chinook, which began entering IAF service earlier this year, has already flown in combat for 57 years. The US Air Force plans for the Chinook to remain till 2050, by when it will be 90 years old. The C-130 Hercules, which the IAF happily bought, has completed 50 years of service and will continue for another 30 years. The AH-64 Apache which will enter IAF service next month is not far from its golden jubilee.

There is a lesson for the IAF in how these “vintage” American aircraft remain at the cutting edge even today, even as Indian MiGs become flying jalopies much earlier. The US military works with the American defence industry in developing its own aircraft, and then in incrementally upgrading them, progressively introducing new technologies that improve combat capability, without obsessing about flying performance. The F-16, which is also close to its half-century age landmark, flies today much like it did in the early 1970s. 

However, its current airborne radar, data links, communications and weaponry make it far superior to its initial variant. The IAF too has upgraded its MiG-21s, MiG-27s and MiG-29s, largely with Israeli avionics. However, there are limits to the extent to which one can upgrade a foreign aircraft, whose design parameters and software source codes are not known. The answer is to introduce indigenous aircraft into service early, and continually upgrade them, keeping them combat-worthy for decades. This is the most economical way of structuring an arsenal. The Tejas light combat aircraft would be a good place for the IAF to start.