Making high-tech weapons in India gets tougher; foreign deals face hiccups

download (3)Source: Business Standard, Jun 06, 2018

New Delhi: Will India ever build a stealth fighter like the US, or even China? When will the country leave behind the tag of world’s largest importer of arms? Before such ambitions can be realised, the country’s defence production and procurement process will have to overcome various roadblocks.

The private sector in India needs to be increasingly involved in equipping the armed forces and keeping them battle ready if the country wants to wean itself off expensive military imports.

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India to go ahead with S-400 deal with Russia amid US sanctions

Source: Business Standard, Jun 05, 2018

New Delhi: India has very clearly conveyed to the US that the “time-tested” Indo-Russian cooperation in the defence sector will continue, including the deal for S-400 Triumf air defence missile systems for the IAF, notwithstanding the American sanctions against Moscow.

Sources said India wants its defence transactions with Russia to be insulated from the purview of stringent American law CAATSA and is likely to raise the issue with the US when the two sides meet in Washington for the 2+2 talks next month.

“In all our engagements with the US, we have clearly explained how India and Russia’s defence cooperation has been going on for a long time and that it is a time-tested relationship. We have mentioned that CAATSA cannot impact the India-Russia defence cooperation,” Defence Minister Nirmala Sitharaman said at a press conference.

She said India has got quite a lot of defence assets from Russia and the cooperation between the two countries will continue.

In January, the US announced sanctions against Russia under its Countering America’s Adversaries Through Sanctions Act (CAATSA) for Moscow’s alleged meddling in the American presidential election in 2016.

CAATSA, which came into effect in January, mandates the Donald Trump administration to punish countries and entities engaging in significant transaction with the defence or intelligence establishment of Russia.

Asked whether India will go ahead with the S-400 deal with Russia, the defence minister said the long-drawn negotiations relating to it have reached final stage.

“The S-400 deal has been on for a very long time and we have reached the final stage of negotiations. That explains it,” she said.

India wants to procure the long-range missile systems to tighten its air defence mechanism, particularly along the nearly 4,000-km-long Sino-India border.Official sources said both Russia and India are likely to announce the deal before an annual summit between Prime Minister Narendra Modi and Russian President Vladimir Putin in October.

There have been mounting concerns in India over the US sanctions against Russian defence majors including Rosoboronexport as billions of dollars of military purchases may be impacted because of the punitive measure.The issue is understood to have figured during Modi’s informal talks with Putin in Sochi last month.

Top American lawmakers and experts have warned that imposition of sanctions on India under a newly-enacted law if it buys the S-400 air defence missile system from Russia could be disastrous for the Indo-US ties.

Last month, the chairman the US’ House Armed Services Committee, Mac Thornberry, had warned that the S-400 deal may limit inter-operability between Indian and US militaries.

The Pentagon too had said it was “very concerned” over the possible implications of Russian sanctions on defence ties between India and the US.

$8.63-billion advanced fighter aircraft project with Russia put on ice

Source: Business Standard, Apr 20, 2018

New Delhi: The proposal for India and Russia to jointly develop an advanced fighter — the eponymous Fifth Generation Fighter Aircraft (FGFA) — has been formally buried. Business Standard has learnt that National Security Advisor Ajit Doval conveyed the decision to a Russian ministerial delegation at a “Defence Acquisition Meeting” in end-February.

Doval and Defence Secretary Sanjay Mitra, who attended the meeting, asked the Russians to proceed alone with developing their fifth-generation fighter. They said India might possibly join the project later, or buy the fully developed fighter outright, after it entered service with the Russian Air Force.

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Airbus, Lockheed rush to tap India’s $620 billion defence market

download (2).jpgSource: LiveMint.com, Apr 11, 2018

New Delhi: For a country that’s known as the world’s biggest arms importer, India’s defence market is a notoriously difficult nut to crack.

Airbus SE hasn’t won a single military contract for half a century. Unperturbed, the European firm is building a supply chain in the South Asian nation; training and expanding a slew of existent part-makers that already help it build commercial jets. The hope is to easily meet local sourcing norms when, and if, it eventually wins an order.

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Rs 15,000 crore weapons purchase proposal approved by government

Source: The Economic Times, Feb 14, 2018

NEW DELHI: The Defence Acquisition Council (DAC) chaired by defence minister Nirmala Sitharaman on Tuesday approved proposals worth more than Rs 15,000 crore to acquire light machine guns, assault rifles and sniper rifles for the three forces.

The council approved the procurement of an “essential quantity” of light machine guns (LMGs) for the three services through the so-called fast track procedure, at an estimated cost of Rs 1,819 crore. The fast-track process is to meet urgent requirements of the regular and special forces.

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India and Cambodia ink 4 pacts to boost defence ties

Source: Business Standard, Jan 29, 2018

Chennai: India and Cambodia on Saturday inked four pacts, including one to improve cooperation in prevention, investigation of crimes and legal assistance in criminal matters, besides a line of credit from India to fund Cambodia’s Stung Sva Hab water resources development project for $36.92 million.

The pacts were signed after comprehensive talks between Prime Minister Narendra Modi and his Cambodian counterpart Samdech Hun Sen, who agreed to further enhance bilateral defence ties, including through exchanges of senior-level defence personnel and capacity building projects.

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After Qatar and Australia, Russia lowers LNG price for India

Source: Financial Express, Jan 16, 2018

New Delhi: After Qatar and Australia, India has got Russia to lower price of liquefied natural gas (LNG) to be imported from May that will help save millions of dollars in import bill. State gas utility GAIL India Ltd has convinced Russia’s Gazprom to lower price of gas under a 20-year deal as well as defer delivery of some of the quantities by 3-4 years, sources privy to the development said. GAIL had in 2012 signed a 20-year deal to import 2.5 million tonnes per annum of LNG from now-cancelled Shtokman LNG in the Barents Sea. Gas under this contract was indexed to average price of customs cleared crude oil imports by Japan, called Japan Customs-cleared Crude or JCC. Deliveries were to start from second quarter of 2018. Sources said the benchmark has been changed to Brent crude oil with lower indexation. Exact price changes were not immediately known. Also, deliveries have been staggered. GAIL will begin with 0.5 million tonnes (MT) buy in the first year, which will be ramped up to 0.75 MT in the following year and then to 1.5 MT in the year thereafter. Entire 2.5 MT would start flowing only in year four or five, sources said, adding that the quantities not taken initially would be bought during the remaining period of the contract. Gazprom will supply LNG from Yamal LNG project in the Arctic peninsula, they said, adding that supplies have been delayed due to weak demand at home.

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