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Such ambition about to be Gone with the Wind?
An EUM Bellwether? India/US Arms Deals Facing Crunch Over Conditions
When countries export weapons, they frequently set associated conditions. Rules against reselling the gear without permission would be a basic condition for obvious reasons, and more advanced restrictions on technology transfer, sharing of details about the weapon with other countries, and related codicils are also common. Some western countries will also place restrictions on what the purchaser can do with the weapons as part of these End Use Monitoring (EUM) agreements. Indonesia turned to Russia as a supplier, for instance, after Britain created problems when the country moved to use its British-made Scorpion light tanks against a separatist insurgency in Aceh. Chad encountered trouble from Switzerland after its Pilatus-7 turboprops were reported to have been armed for use against Sudanese-backed forces. A problem that the opposing Sudanese forces dont have with their new Chinese and Russian jets.
During the Cold War, regimes always had the option of playing Western suppliers off against the Soviet Union. With the USSRs collapse, that option disappeared for a while, but the re-emergence of Russias weapons industry, and the development of competitive arms industries in countries like China, South Korea, Brazil, and India, is changing the global equation again.
EUMs are likely to be affected by this trend, as the leverage to apply them declines. The question is which items are deal-breakers that must be retained by western countries, and which will be allowed to quietly fall by the wayside. That decision will be different in different countries, of course. Meanwhile, the strains created in India by standard American EUMs appear likely to provide an early indicator. India is a leading edge case for a number of reasons
A Trend-Setters Trends
India is a leading edge case for a number of reasons
* Western military export sanctions, imposed after India developed nuclear weapons, exacerbated existing thinking within India that aimed at 100% self-sufficiency in weapons projects. While that concept still has strong constituencies within India, it has been a conspicuous failure at fielding capable equipment in a timely fashion, especially when compared to rival Chinese and Pakistani efforts. These failures, and the contrasting success of flagship foreign partnerships like the PJ-10 BrahMos supersonic cruise missile, are driving a shift toward more foreign participation, and more private local industry, in Indias state-controlled arms industries.
* Rather than reverting to its previous state of effective dependence on the USSR, however, India is consciously moving to source its military equipment in a multi-polar fashion.
* Its growth, and the growth of its security needs and interests, has made it one of the globes largest and most coveted arms export markets; and
* The country has historically been seen as a leader within the so-called global non-aligned movement of 3rd and 4th World countries.
France and Israel have both played long-standing roles in India as defense suppliers. The most dramatic sign of Indias multi-polar orientation, however, has been the opening of Indias market to American firms. An early pair of $1+ billion deals for 6-12 new MC-130J Hercules special forces aircraft and 8-16 new P-8i sea/ land surveillance and control aircraft have led that trend.
More may follow. If, and only if, Indias issues with American EUMs can be worked out.
EUM Issues and Options
A Defense News article describes many of the issues, and quotes Jeffrey Kohler, Boeing Integrated Defense Systems vice president of international strategy. Kohler is also a former head of the USAs Defense Security Cooperation Agency (DSCA), which handles American weapons exports and conditions.
The End Use Monitoring (EUM) provision has been an issue all along, Kohler said. Weve sort of pushed it down the road while the two governments work on it. But were reaching a very critical point now. Lockheed is reaching a critical point on the C-130. We [Boeing] now have a major contract that, obviously, we would like to see this issue resolved. If no agreement is reached this year on EUM language, Kohler said, There will be a serious blow to the relationship and, obviously, it would make it virtually impossible for U.S. defense companies to work with the Indians.
Indias non-negotiable items appear to revolve around insistence that India will not be told how and where to operate the equipment it buys for its own military, and that it is not prepared to submit to annual inspections of its military equipment by US officials. The latter was finessed in order to allow Boeing Business Jets to sell India 3 VIP aircraft; the provision remained, on the tacit understanding that the USA would not do so unless security concerns arose. That is very unlikely for this sort of sale. Of course, if relations were to deteriorate to that point, India would always have the option of simply refusing.
Thats exactly what India did when it transferred some of its British-built BN-2 Britten-Norman Islander light surveillance aircraft to the junta in Myanmar, which is on international human right blacklists. Official British objections and warnings were simply brushed aside.
The problem is that American laws and interests are likely to make re-transfer restrictions a non-negotiable item.
Other provisions in standard American EUMs include the USAs Communications and Information Security Memorandum of Agreement that governs how, when, and by whom sensitive information can be shared with and within India; and the Logistics Supply Agreement, which may be an especially sensitive point given Indias past experience with LSA cutoffs.
Conflicting accounts surround the MC-130J sale, with some Indian sources claiming that the signing of EUM provisions has been delayed, and US DSCA spokesman Charles Taylor saying that unspecified EUM provisions were included. Boeings P-8i is being handled as a Direct Commercial Sale instead, which is still regulated by the US State Department. Unlike Foreign Military Sales, however, EUM agreements that comply with American laws arent required until delivery, which is expected to take place in 2013.
Defense News quotes Lockheed Martin Globals South Asian president Rick Kirkland, who believes that an umbrella agreement covering US-India trade in general, and addressing defense industry cooperation in particular, may be the solution. India has already implemented a framework of this type with Russia, via the Indo-Russian Inter-Governmental Commission for Military-Technical Cooperation, and is hammering out a similar approach with France.
Without that kind of approach, or progress on individual EUM negotiations, further defense sales involving top-of-the-line equoipment like E-2D Hawkeye AWACS aircraft, Patriot missiles, or the most advanced F-16 and F/A-18 jets would face extreme obstacles.
Broadly speaking, there are three potential outcomes, and internal politics in both countries will play a role:
(1) India ends up simply refusing to accept EUM provisions required under American law, and those laws are not changed, leading to disqualification or non-selection of American equipment, in favor of comparable alternatives. That decision could have strong impacts on Israels defense relationship with India, as Israel is now subject to a de facto US veto for arms exports. The decision would also have wider global ripples, and would be seen as an example by many governments around the world.
(2) The USA could modify its weapons export laws to accommodate some of Indias objections, and existing global realities. That, too, would be seen as a bellwether by many governments around the world. Its impact would be more limited, because many countries do not have the same level of strategic leverage with American or European governments. The biggest impact would be seen among emerging mid-tier arms exporters with accountable governments, like Brazil and South Korea, who would be likely to water down their own arms export controls.
(3) An umbrella agreement could be worked out that finesses some EUM provisions, while featuring reluctant acceptance of others by India. This would represent a partial climb-down by India, in exchange for a developing strategic relationship with America, a wider set of options for arms supply, and access to some of Americas most sophisticated equipment.
Time will tell.
An EUM Bellwether? India/US Arms Deals Facing Crunch Over Conditions
When countries export weapons, they frequently set associated conditions. Rules against reselling the gear without permission would be a basic condition for obvious reasons, and more advanced restrictions on technology transfer, sharing of details about the weapon with other countries, and related codicils are also common. Some western countries will also place restrictions on what the purchaser can do with the weapons as part of these End Use Monitoring (EUM) agreements. Indonesia turned to Russia as a supplier, for instance, after Britain created problems when the country moved to use its British-made Scorpion light tanks against a separatist insurgency in Aceh. Chad encountered trouble from Switzerland after its Pilatus-7 turboprops were reported to have been armed for use against Sudanese-backed forces. A problem that the opposing Sudanese forces dont have with their new Chinese and Russian jets.
During the Cold War, regimes always had the option of playing Western suppliers off against the Soviet Union. With the USSRs collapse, that option disappeared for a while, but the re-emergence of Russias weapons industry, and the development of competitive arms industries in countries like China, South Korea, Brazil, and India, is changing the global equation again.
EUMs are likely to be affected by this trend, as the leverage to apply them declines. The question is which items are deal-breakers that must be retained by western countries, and which will be allowed to quietly fall by the wayside. That decision will be different in different countries, of course. Meanwhile, the strains created in India by standard American EUMs appear likely to provide an early indicator. India is a leading edge case for a number of reasons
A Trend-Setters Trends
India is a leading edge case for a number of reasons
* Western military export sanctions, imposed after India developed nuclear weapons, exacerbated existing thinking within India that aimed at 100% self-sufficiency in weapons projects. While that concept still has strong constituencies within India, it has been a conspicuous failure at fielding capable equipment in a timely fashion, especially when compared to rival Chinese and Pakistani efforts. These failures, and the contrasting success of flagship foreign partnerships like the PJ-10 BrahMos supersonic cruise missile, are driving a shift toward more foreign participation, and more private local industry, in Indias state-controlled arms industries.
* Rather than reverting to its previous state of effective dependence on the USSR, however, India is consciously moving to source its military equipment in a multi-polar fashion.
* Its growth, and the growth of its security needs and interests, has made it one of the globes largest and most coveted arms export markets; and
* The country has historically been seen as a leader within the so-called global non-aligned movement of 3rd and 4th World countries.
France and Israel have both played long-standing roles in India as defense suppliers. The most dramatic sign of Indias multi-polar orientation, however, has been the opening of Indias market to American firms. An early pair of $1+ billion deals for 6-12 new MC-130J Hercules special forces aircraft and 8-16 new P-8i sea/ land surveillance and control aircraft have led that trend.
More may follow. If, and only if, Indias issues with American EUMs can be worked out.
EUM Issues and Options
A Defense News article describes many of the issues, and quotes Jeffrey Kohler, Boeing Integrated Defense Systems vice president of international strategy. Kohler is also a former head of the USAs Defense Security Cooperation Agency (DSCA), which handles American weapons exports and conditions.
The End Use Monitoring (EUM) provision has been an issue all along, Kohler said. Weve sort of pushed it down the road while the two governments work on it. But were reaching a very critical point now. Lockheed is reaching a critical point on the C-130. We [Boeing] now have a major contract that, obviously, we would like to see this issue resolved. If no agreement is reached this year on EUM language, Kohler said, There will be a serious blow to the relationship and, obviously, it would make it virtually impossible for U.S. defense companies to work with the Indians.
Indias non-negotiable items appear to revolve around insistence that India will not be told how and where to operate the equipment it buys for its own military, and that it is not prepared to submit to annual inspections of its military equipment by US officials. The latter was finessed in order to allow Boeing Business Jets to sell India 3 VIP aircraft; the provision remained, on the tacit understanding that the USA would not do so unless security concerns arose. That is very unlikely for this sort of sale. Of course, if relations were to deteriorate to that point, India would always have the option of simply refusing.
Thats exactly what India did when it transferred some of its British-built BN-2 Britten-Norman Islander light surveillance aircraft to the junta in Myanmar, which is on international human right blacklists. Official British objections and warnings were simply brushed aside.
The problem is that American laws and interests are likely to make re-transfer restrictions a non-negotiable item.
Other provisions in standard American EUMs include the USAs Communications and Information Security Memorandum of Agreement that governs how, when, and by whom sensitive information can be shared with and within India; and the Logistics Supply Agreement, which may be an especially sensitive point given Indias past experience with LSA cutoffs.
Conflicting accounts surround the MC-130J sale, with some Indian sources claiming that the signing of EUM provisions has been delayed, and US DSCA spokesman Charles Taylor saying that unspecified EUM provisions were included. Boeings P-8i is being handled as a Direct Commercial Sale instead, which is still regulated by the US State Department. Unlike Foreign Military Sales, however, EUM agreements that comply with American laws arent required until delivery, which is expected to take place in 2013.
Defense News quotes Lockheed Martin Globals South Asian president Rick Kirkland, who believes that an umbrella agreement covering US-India trade in general, and addressing defense industry cooperation in particular, may be the solution. India has already implemented a framework of this type with Russia, via the Indo-Russian Inter-Governmental Commission for Military-Technical Cooperation, and is hammering out a similar approach with France.
Without that kind of approach, or progress on individual EUM negotiations, further defense sales involving top-of-the-line equoipment like E-2D Hawkeye AWACS aircraft, Patriot missiles, or the most advanced F-16 and F/A-18 jets would face extreme obstacles.
Broadly speaking, there are three potential outcomes, and internal politics in both countries will play a role:
(1) India ends up simply refusing to accept EUM provisions required under American law, and those laws are not changed, leading to disqualification or non-selection of American equipment, in favor of comparable alternatives. That decision could have strong impacts on Israels defense relationship with India, as Israel is now subject to a de facto US veto for arms exports. The decision would also have wider global ripples, and would be seen as an example by many governments around the world.
(2) The USA could modify its weapons export laws to accommodate some of Indias objections, and existing global realities. That, too, would be seen as a bellwether by many governments around the world. Its impact would be more limited, because many countries do not have the same level of strategic leverage with American or European governments. The biggest impact would be seen among emerging mid-tier arms exporters with accountable governments, like Brazil and South Korea, who would be likely to water down their own arms export controls.
(3) An umbrella agreement could be worked out that finesses some EUM provisions, while featuring reluctant acceptance of others by India. This would represent a partial climb-down by India, in exchange for a developing strategic relationship with America, a wider set of options for arms supply, and access to some of Americas most sophisticated equipment.
Time will tell.
