The race is on for India's mega
fighter deal By Siddharth
Srivastava
NEW DELHI - Competition and
lobbying is going to be intense for the US$11
billion 126 multi-role combat aircraft deal that
India is likely to sign a couple of years from
now.
This Monday, the six contenders of
the mega contract submitted their bids to the
federal Defense Ministry, each offering "strategic
and unequivocal partnerships", including joint
production, government support and advanced jets
at the cheapest cost.
The bids were
submitted following an extension from February
when they were first due, with major fighter jet
aircraft makers from America, Europe and Russia
staking claims. The request for proposals for the
deal was issued in August 2007, after
delays
that
span over a decade and a half.
The
fighters in the fray are the American Boeing's
F/A-18 Super Hornet, Lockheed Martin's F-16
Falcon, Russian MiG-35s, Swedish Saab's Gripen,
French Dassault Rafale and the Eurofighter Typhoon
by a consortium, the European Aeronautic Defense
and Space Company (EADS).
The multi-role
fighter is a crucial cog in India's combat
aircraft modernization plans, involving three main
systems: the Indian-developed Tejas as a light
combat aircraft, the new multi-role fighter in the
medium combat aircraft category, and Russian
Sukhoi-30MKIs as heavy combat aircraft.
"We will now seriously examine all the
bids and shortlist the companies in due course to
two or three, before taking a final decision," a
Defense Ministry spokesperson said. "Even if
everything does work out smoothly, we don't expect
the first batch of fighters in India before 2011."
The selection process will begin with the
Indian Air Force (IAF) making a technical study.
It then submits its report to the Defense
Ministry, which looks at both the financial and
technical aspects. Then it goes to the cabinet
committee on security, which comprises top
ministers, including the prime minister, to make a
final call. It is at the cabinet stage that the
political and strategic aspects come into play.
Middlemen can be involved at any stage of
the deal. In the past, sting operations, such as
those by the noted investigative website
Tehelka.com, have shown that defense officers,
political party representatives as well as
friends, relatives and minions, can be involved in
influencing defense contracts.
About 20
fighters will be bought off-the-shelf and the
remaining 100-plus will be produced in India under
a transfer of technology agreement. New Delhi has
said it will ultimately settle for a single
fighter jet platform, instead of multiple sources.
Since 1999, India's military purchases have been
worth $25 billion; the country is likely to spend
another $30 billion by 2012, making it one of the
biggest military buyers among developing
countries.
Many defense analysts say
Lockheed and Boeing are front-runners to win the
jet contract, but the race is far from over, given
domestic Indian politics that opposes any US
"hegemony", whether actual or apparent, apart from
technical considerations. The fate of the derailed
India-US deal on civilian nuclear cooperation is
one such pointer.
Indian defense deals are
also notorious for delays, political interference,
lack of transparency and hush money via agents and
middlemen that has substantially stymied
acquisition processes in the past.
US
companies, however, are not deterred and continue
to offer irresistible spin-offs from futuristic
fifth-generation fighter programs, such as
Lockheed Martin's F-35 "Lightning II" project. St
Louis-based Boeing submitted its 7,000 page
proposal offering its advanced Super Hornet.
The Indian variant, based on the US Navy's
F/A-18E/F, is equipped with the latest technology
such as Raytheon's AESA radar with proven
reliability, attractive life-cycle cost dynamics
and air defense system.
Australia has also
ordered 24 Super Hornets, while many international
customers are in negotiations to procure the
aircraft.
Boeing has signed long-term
partnership agreements with Indian entities with
defense interests, such as state-run Hindustan
Aeronautics Limited (HAL), Tata Industries and
Larsen and Toubro, which will be engaged in
production and assemblage if Boeing wins the deal.
According to Chris Chadwick, president of
Boeing Precision Engagement and Mobility Systems,
"Boeing will give Indians a direct hand in
building an advanced fighter aircraft."
Lockheed calls its fighter offer the F-16
IN and said it is "specifically tailored to meet
IAF needs and is the most advanced multi-role
combat aircraft in production anywhere in the
world today". Lockheed too has been tying up with
Indian defense players in preparation for the bid.
Not to be undone, European aircraft makers
are making a concerted effort. EADS has invited
India to "become a member of the successful
Eurofighter family" and be its "partner of choice"
in "long-lasting political, industrial and
military relations".
The chief executive
of military air systems at EADS, Bernhard Gerwert,
said, "If India becomes a partner, they will also
become a partner in all future technology
enhancement. As part of our industrial cooperation
offer, we invite India to become our member."
India became the first non-European
country to be extended such an invitation during a
recent event organized by EADS in New Delhi,
attended by the envoys of Germany, Britain, Italy
and Spain. The Eurofighter consortium consists of
Britain's BAE Systems, Italy's Alenia Finmeccanica
and German and Spanish units.
Meanwhile,
Sweden's Saab has positioned its Gripen fighter as
the "independent choice" for India, and it could
well be the dark horse. Following the line of
Boeing and Lockheed, Saab is also looking to tie
up with HAL and the Tata Group to meet local
investment standards, should they arise.
Speaking to the media on the day of
submitting its request for proposal to the IAF,
Ake Svensson, chief executive and president of
Saab, said, "We think the Gripen is perfect for
Indian requirements and complements your heavy
class Sukhoi Su-30 well. Also, the single engine,
coupled with a high rate of reliability and a low
cost of maintenance make it a viable option for
India."
France is banking on India's
positive experience with the Mirage-2000s,
inducted into the IAF in the mid-1980s, and is
hard-selling its Rafale multi-role fighter.
Russia stands firm with its MiG-35 jets,
despite recent irritants in the long-standing
partnership with Delhi. India's defense relations
with Russia continue to be deep. This is in part
due to India's efforts to bring oil and gas from
the Sakhalin oil fields. Last October, India and
Russia agreed to jointly design, develop and
manufacture the fifth-generation fighter aircraft.
The IAF is inducting multi-role fighters
such as Sukhoi-30MKIs (230 jets have also been
contracted from Russia for $8.5 billion). India
has also signed a 40 billion rupee (US$994
million) deal with Russia to upgrade its 69
MiG-29s by 2011.
Following the success of
jointly building the Brahmos cruise missiles, New
Delhi is looking to extend its cooperation with
Russia in the co-development of a multi-role
transport aircraft.
Some analysts,
however, say New Delhi's defense overtures could
actually be preparing ground for a bigger loss for
Moscow as the deal could go either to Europe or
America.
Indeed, an emerging trend in
India's defense policy is a skilful balancing of
its strategic relationships with the major powers,
(Europe, Israel, Russia and the US), thus doling
out contracts to practically all of these
countries.
Britain's BAE systems have
benefited hugely from the Indian purchase of Hawk
aircraft trainers. India has finalized the
purchase of six Hercules transport aircraft from
Lockheed Martin and recently announced its
intention to collaborate with Israel in developing
a futuristic long-range surface-to-air missile.
The fighter choice will not be easy. The
surfeit of bidders only makes India's negotiating
position stronger. State-of-the-art aircraft, deep
pockets and well-oiled networks will all count.
Siddharth
Srivastava is a New Delhi-based
journalist.
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