Around the world, opinions about Donald’s Trump’s new term as president have been largely negative, largely because of his claim that he will impose tariffs of between 10% and 20% on all imports. Among is first acts has been to renege again, as he did during his first stint, on the Paris Agreement on climate change.
A survey by the Pew Research Centre in 2019 had found that 64% of respondents in 32 countries lacked confidence in Trump to do the right thing in the world’s affairs when he was in his first term as US president.
He received low ratings in Western Europe, with 74% of Germans and 70% of French citizens declaring that they lacked confidence in him. However, in India, 66% of respondents expressed confidence in him. This is not surprising as many Hindutva adherents who support Narendra Modi saw in Trump muscular leader who seemed to be a global reflection of the values propagated by the Indian prime minister. On public platforms, Trump seems to share a close bond with Modi.
Among those with keen hopes that Indo-US ties will be strengthened during Trump’s new term are many in India’s defence sector. But they are ignoring the fact that while arms deals with the US would fuel Trump’s claim that he is making American great again, they could undermine Modi’s Make in India campaign.
Historical background
To understand this, it is essential to understand the historical background of the Indo-US relationship and how it shaped India’s arms procurements.
In 1954, India’s first prime minister, Jawaharlal Nehru, did not give in to the US overtures to become a partner in the Southeast Asia Treaty Organization military alliance formed to contain China in Asia. Instead, Pakistan became a trusted military partner.
Taken by surprise by the Chinese attack in 1962, the pacifist in Nehru extended a hand to his ideological ally Nikita Khrushchev of the now-defunct Union of Soviet Socialist Republics to produce MIG 21 fighter planes through the technology transfer route.
The situation got even more tense in 1971 when US President Richard Nixon ordered his country’s Seventh Fleet to head to the Bay of Bengal as a warning to India as the war with Pakistan proceeded over the creation of Bangladesh. The USSR led by Leonid Brezhnev countered the US threat by dispatching its own fleet to the region. Moscow stood behind India at the United Nations by exercising its veto power.
In 1971, the two nations signed a treaty to intensify their strategic cooperation. Under the rubric of the Indo-Soviet partnership, India began to produce tanks, frigates, missiles and fighter aircraft.
The transfer of technology model gives India the advantage of acquiring indigenous skills and economising substantially on cost. India began to produce T72 tanks, followed by its upgraded version, the T90. India has so far manufactured 1,000 T90 tanks. In terms of fighting potential, the T90 tanks are as good as US Abram tanks and almost 50% less expensive.
In the fourth-generation fighter aircraft segment, India has produce 250 SU30s. The US F-16 aircraft costs twice as much.
By contrast, the US relationship with India continued to be brittle. In 1998, after India conducted nuclear tests, Washington imposed sanctions on New Delhi.
India’s programme to produce an indigenous light combat aircraft to replace its aging MIG 21 fleet took a hit as Martin Marietta, an American company, reneged on its commitment to develop the flight control system.
When it comes to defence equipment and platforms, a country has three options. It could produce an indigenous design (make), import the system outright (buy), or buy technology and produce (buy and make).
Given India’s poor research and development capacity in the years after Independence, Nehru was prudent to realise the best option for India was not to import but to buy and make if a trusted partner was on hand. The USSR filled that role admirably.
Watershed moment
The Kargil War in 1999 was a watershed moment for India when it was taken completely by surprise by the influx of armed Pakistani intruders in the absence of a proper surveillance radar. India’s efforts to develop an indigenous radar had come a cropper. That is how India in 2002 began to procure gun-locating radars from the US for $146 million.
This has changed India’s defense acquisition policy. Instead of option for single-source buys from Russia, New Delhi to make purchases from Western nations, including the US, France and Israel.
By 2005, the US was no longer quite so wary of the idea that India too was a nuclear power. With Manmohan Singh as India’s prime minister, the countries signed a deal to collaborate on a civil nuclear energy programme. This enabled the transfer of nuclear technology, fuel, and equipment.
It became clear that the US had dropped its opposition to denying India technology transfers, when New Delhi in 2007 issued for a global tender to initially procure and then produce indigenously medium multi role combat aircraft through technology transfer. The US, which bid on its F-16 and F/A-18 Hornet jets, was prepared to part with technology for indigenously producing the engines and also the active electronically scanned array radars.
But the buy and make programme for the jets was shelved in 2015 when the Narendra Modi government opted to buy Rafale aircraft from France.
Be that as it may, India has post-2006 made major arms acquisitions from the US, including a $3.2-billion deal for like P-81 maritime patrol aircraft. New Delhi has also bought C-17 Globemaster aircraft and CH-47 Chinook helicopters and M-777 howitzers from the US. These procurements are being made directly from the US under the foreign military sales route, skirting global competitive bidding.
Complex system
Among the deals with India that Donald Trump will look forward to concluding in his new term include purchases of MQ-8B predator drones, maritime patrol aircraft and land attack missiles. One of the recurring themes in all these major big-ticket acquisitions is that they are direct buys, without technology being transferred.
When the buy and make acquisition of the medium multi role combat aircraft was being pursued, the objective was to get an alternative Western technology for engines and other subsystems for Russian engines and subsystems that India was manufacturing.
Defence acquisitions are complex as it is dominated by an oligopoly of a few global suppliers and a monopsony of governments as single buyers. It provides a unique opportunity for leaders to buy from a single source under the cover of an inter-government agreement and the claim of strategic requirements.
The foreign military sales route deprives India of the benefit of discovering the right cost through competitive bidding. By directly buying these platforms, India also only missing out on the opportunity to acquire technology and to bolster its manufacturing capabilities.
Satya Narayan Misra is a former joint secretary (aerospace) in the ministry of defence.
