In Last Decade India has Iinked Defense Deals worth over $50 billion

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In Last Decade India has Iinked Defense Deals worth over $50 billion

In the decade since the 1999 Kargil conflict, India has inked deals worth over $50 billion to acquire fighters, warships, tanks, missiles, other weapon systems and platforms, the overwhelming majority of them from abroad. That is not all. India is poised to spend well over $30 billion over the next four-five years to import military hardware and software, which will only serve to reinforce its position as the developing world's biggest arms buyer.

China, of course, spends much more -- its `declared' defence budget this year is $70 billion compared to India's $30 billion -- but it's difficult to do number-crunching about its military acquisitions, hiding as it does more than revealing. Pakistan, on its part, is not too far behind. It even pipped India, for instance, in 2006 by notching up arms import deals worth $5.1 billion, compared to India's $3.5 billion.

Disclosing the defence ministry's official figures on Thursday, top sources said India spent Rs 62,672 crore on `direct capital acquisitions' in the 1999-2004 timeframe. "This has more than doubled in the last five years (2004-2009) to Rs 1,37,496 crore. It becomes Rs 1,78,496 crore if one adds the Rs 41,000 crore earmarked for net capital expenditure this fiscal,'' said a source.

The scorching pace set can be gauged from the fact that the defence ministry inked as many as 465 arms contracts worth Rs 1,35,000 crore in just the last three years. Russia continues to lead the pack of defence suppliers to India, with annual sales worth around $1.5 billion, followed by Israel, which adds $1 billion or so to its kitty every year.

Then come others like France and UK. But it's actually the US which is now increasingly muscling into the lucrative Indian arms market, having already bagged the $2.1 billion contract for eight Boeing P-8I long-range maritime reconnaissance aircraft and the $962 million deal for six C-130J Super Hercules planes.

There is, however, quite a bit of disquiet over whether India actually gets the biggest bang for its buck, given the lack of concrete long-term strategic planning to systematically build military capabilities in tune with the country's growing geo-political aspirations.

Nevertheless, the sharp upward trajectory in modernising the armed forces is considered imperative since India is the only country with long unresolved borders with two nuclear-armed, largely hostile neighbours. Then, of course, there is the deadly threat of unconventional warfare, as was underlined by the 26/11 terror attacks.

Big defence deals inked

* US: 6 C-130J Super Hercules aircraft for $962 million (2007); 8 Boeing P-8I planes for $2.1 billion (2009)

* Israel: 3 Phalcon AWACS for $1.1 billion (2004); Rs 10,075 crore project to jointly develop medium-range surface-to-air missile systems (2009)

* France: 6 Scorpene submarines in a Rs 18,798 crore project (2005)

* Russia: Admiral Gorshkov and 16 MiG-29Ks in $1.5 billion package deal (inked in 2004 but aircraft carrier's refit to zoom up to $2.5 billion now from original $974 million); 230 Sukhoi-30MKIs for $8.5 billion

* UK: 66 Hawk AJTs in a Rs 8,000 crore project (2004)

Big projects in offing

* Rs 42,000 crore project for 126 multi-role combat aircraft

* Rs 30,000 crore project for 6 new-generation submarines after Scorpenes

* Rs 20,000 crore artillery modernisation programme to acquire 1,580 towed guns, 814 mounted gun systems, 180 self-propelled wheeled guns, 100 self-propelled tracked guns and 140 air-mobile ultra-light howitzers

* Rs 20,000 crore for around 800 helicopters, ranging from VVIP and heavy-lift to attack and light utility

From:ASIAN DEFENCE: In Last Decade India has Iinked Defense Deals worth over $50 billion

this is why

 

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'Half of defence equipment is obsolete'

NEW DELHI: According to a CII-KPMG report, 50% of the existing defence equipment is obsolete and replacements are held up due to procurement delays. This is what the defence minister plans to address when he revises the defence procurement procedures. The Defence Minister A K Antony today said the defence procurement procedure will be revised to improve timelines.

The increased focus on homeland security, and India’s growing stress on home market defence sourcing hub is attracting attention all over the world. A joint study by CII-KPMG on defence sector titled 'Opportunities in the Indian Defence Sector: An Overview' reveals that Indian Industry is upbeat about the opportunities in defence and aerospace, but is looking to the government to continue its process of developing and fine-tuning the procurement regime.

India currently procures about 70 percent of it equipment needs from abroad, but aims to reverse this balance and manufacture 70 per cent or more of its defence equipment in India. The intention of the govt may be good but there is little information available as to what the the forces require.

While the government has put in place the building blocks to incentivise the growth of the domestic defence industry, the CII-KPMG report identifies three areas where industry is seeking further Government input. These are the procurement process, the need for a defence industrial strategy and tax and regulatory incentives.

Despite a 30 year long association with the defence ministry Chairman of Bharat Forge Baba N Kalyani says that the govt still has to sort out several policy bottlenecks for the private defence sector to attain its full potential.

'Half-of-defence-equipment-is-obsolete'-BloombergUTV News: India news, business news, latest news india, financial news, india news online, business news channel, latest business news, india daily news at BloombergUTV.com

 

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hope that ends the discussion on this thread