Of a strong man and a beautiful woman

My article Of a strong man and a beautiful woman appeared in the Edit Page of The Pioneer.

Here is the link...

Manohar Parrikar's four-day visit to China will accelerate India-China security dialogue, but it’s unlikely the Defence Minister will discuss about the difficult situation faced by people living in border area of Demchok
As Defence Minister Manohar Parrikar arrived in Beijing on a four-day visit, The Global Times asserted: “India would like to continue to be the most beautiful woman wooed by all men, notably the two strongest in the house, US and China.” The mouthpiece of the Communist Party was particularly referring to the Logistics Support Agreement, signed when the US Defence Secretary Ashton Carter came to Delhi a few days earlier.
The usually hard-hitting newspaper explained: “This is not an unfamiliar role to India. We can still recall how its diplomatic manoeuvring had earned itself a special role between the two competing blocs during the Cold War.”
Well, it is doubtful if Beijing will fall in an Indian honey trap during the Defence Minister’s visit and agree to some of the Indian demands. Apart from the usual requests, such as China providing maps of their perception of the Line of Control, the difficult situation of the border populations in Ladakh should be taken up. Let me explain.
While the number of Chinese intrusions across the LAC is slightly less due to the mechanisms put in place between Delhi and Beijing, the Chinese refuse the ‘permission’ to the villagers in the Demchok area to undertake basic work on the Indian side of the border.
On April 13, just four days before Parrikar’s departure, The Daily Excelsior reported: “Frustrated with the Chinese Army’s frequent intervention raising objection on carrying out any kind of developmental activities near the borders areas, the inhabitants of Demchok village, residing on the Indo-China border, have demanded resettlement.”
On April 8, the Scientific Advisory Committee from Nyoma tried to pacify the inhabitants of the 39 households in Demchok who refused to end their dharna; later a delegation approached Prasanna Ramaswamy, the Deputy Commissioner in Leh, demanding to be shifted; the People’s Liberation Army had raised some objection over the villagers laying a pipe line from a hot spring for drinking water. The residents of Demchok listed several instances, when the PLA stopped them to undertake developmental work.
According to The Daily Excelsior: “The residents had put up a tent at bank of Demchok nallah with national flag on its top, insisting the administration to shift them somewhere as the Chinese objected to carry out any kind of developmental activities in their village since 2000.”
On their side of the nallah, which for centuries marked the border, the Chinese do not face any Indian objections. In the last couple of years, Beijing has invested millions of yuans to develop the area along the Indus river from Tashigong, the first Tibetan village, to a place they call ‘Dian-jiao’ (the Chinese pronunciation for Demchok). They have even roped in the Shaanxi Province which provides the necessary funds for development. New buildings (particularly guest houses) can clearly be seen from the Indian side.
Though Demchok has been the first Ladakhi village since immemorial times, during the negotiations for the Panchsheel Agreement in 1954, China refused to acknowledge this. Due to China’s reticence to recognise Demchok, the talks went on for four months (from December 1953 to April 1954), instead of the expected three or four weeks. The main Chinese objection was mentioning Demchok on the route to Western Tibet.
On April 23, 1954, a few days before the final signature of the Agreement, N Raghavan, the Indian Ambassador to China, wrote to RK Nehru, the Foreign Secretary, that Chang Han-fu, the Chinese negotiator ‘vigorously’ objected to the inclusion of Demchok in the Agreement: “(He) conceded that traders customarily using this route might continue such use but said an oral understanding to that effect between two delegations would suffice. We strongly contended inclusion of route in Agreement.”
Very cleverly, another Chinese diplomat ‘privately’ told TN Kaul, his Indian counterpart, that he was objecting because they were not keen to mention the name ‘Kashmir’ as they did not wish to take sides between India and Pakistan. Though Kaul could see through the game, India finally gave in. Kaul later wrote: “However, their real objection was, I believe, to strengthening their claim to Aksai Chin which they needed for linking Sinkiang (Xinjiang) with Western Tibet.”
Finally it was agreed that: “the customary route leading to Tashigong along the valley of the Indus river may continue to be traversed in accordance with custom was worked out and Delhi approved it.”
Demchok was not mentioned. The issue faced by the villagers is the outcome of this formulation. In 1954, instead of using the opportunity to clarify the already contentious border issue, the Chinese were allowed to walk away with a vague statement which opened the door for future contestations.
Already then, the ‘beautiful Indian woman’ was unable to woo the tough Chinese negotiators. It may not be different 62 years later. China has truly a problem with Demchok.
Last year, the Chief Executive Councilor of the Ladakh Autonomous Hill Development Council, Rigzin Spalbar wrote to the then Jammu & Kashmir Chief Minister  Mufti Mohammed Sayeed to request him to take up with Delhi the re-opening of the Kailash-Manasarovar route via Demchok.
A few months earlier, President Xi Jinping had ‘generously’ offered (as a ‘political gesture’) to open a new route, via Nathu la in Sikkim, for Indian pilgrims wanting to go on the yatra. The Indian Press clapped. It is true that for those who were unaware of the topography of the Himalayas, the Chinese offer to open Nathu-la seemed reasonable.
In his letter to Sayeed, Spalbar, after mentioning the historical background of Demchok, which till 1954, was used by most of the Indian pilgrims wanting to go on pilgrimage to the Kailash, also suggested re-opening the route; the Holy Lake and Sacred Mountain are located at a mere two-day drive from Leh and the route is relatively easy as it does not encounter any major pass. But here too the Chinese are not ready to be wooed.
Will Mr Parrikar’s visit be a success? Perhaps one or two Border Personnel Meeting points may be agreed upon, which is good; Demchok, however, will not be in the list. Perhaps the Joint Tactical Exercise held for the first time last year between the troops of both countries in the Chushul-Moldo area will be repeated on a larger scale. Great!
And in a few months time, a hotline may be established between the two military headquarters as part of an effort to improve border management. This however will not solve more serious issues such as Demchok. It may be left to the National Security Advisor and Special Reprehensive for the border Ajit Doval to raise the issues with his counterpart State Councillor Yang Jiechi. Will Yang be charmed by the NSA and agree to release the tension on Demchok? This will be a meaningful confidence-building measure, but is the ‘strong boy’ interested to please the ‘beautiful woman’?

Will the IAF not get its Rafales?

French and Indian Air Chiefs in front of Rafale (Jodhpur 2014)

My article Will the IAF not get its Rafales? appeared in Rediff.com

With the Rafale fighter deal stuck over price, can the prime minister step in and find a way out for both countries?
Claude Arpi examines the issue.

During the recently conducted Indian Air Force drill ('Iron Fist Exercise 2016') in Pokhran, Rajasthan, attended by President Pranab Mukherjee and Prime Minister Narendra Modi, Air Chief Marshal Arup Raha declared: “This demonstration is the tip of an iceberg when compared to the overall capability of the air force.”
Well, it is a melting iceberg, with the Indian fleet rapidly reducing.
The Air Chief admitted: “The IAF has flagged concerns about the shortage of fighter jets and the process for the acquisition of 36 French Rafale fighter aircraft is still underway."
What does ‘underway’ mean?

Hollande's visit
Let us do a flashback to January 25, 2016.
As Manohar Parrikar, the Indian Defence Minister and his French counterpart Jean-Yves Le Drian signed a MoU for the purchase of 36 Rafale aircrafts, President Hollande of France said, in front of the national and international media in Hyderabad House, that the ‘real’ deal would be inked ‘dans les jours prochains’ (‘in the coming days’).
Later Dassault Aviation, the aircraft manufacturer, clarified that it would take about 4 weeks. The French officials, including Le Drian, accompanying the French President during his State visit were quite optimistic that this could be done.
On February 18, during an interview with Karan Thapar on India Today TV Parrikar stated: “Price is the only issue left now, …an agreement on 50 percent offsets has been reached.”
News appeared that Dassault would have quoted around $9 billion for the 36 jets while South Block was expecting a much cheaper price. The final deal would include two types of missiles and bombs, training of pilots and two base facilities for the planes.
Incidentally, the latter creates a huge problem for the French Air Force (FAF), already overstretched with a growing number of overseas military interventions and a shrinking budget. The Rafale deal, if it comes through, like the previous ones signed with Egypt and Qatar, is not a boon for the FAF, which will be responsible for the training and setting up of the bases. It will however be a huge success for the rather unpopular French President …and France’s economy.
As talks were going on, a report in the Indian press pointed out to several loopholes, apparently earlier overlooked by the Modi Sarkar.
The Union Law Ministry would be objecting to some clauses in the January MoU; they could 'compromise' India’s interests, it says.

The Saga
But first let us recall that the initial Request for Information had been issued in 2001. Fifteen years ago! The Request for Proposal (RFP) was only issued in 2007, as the then minister, AK Antony wanted to add new clauses, such as the Total Life-cycle Costs, in the Indian defence procurement policy. The ‘complications’ had started. Finally, in January 2012, the French firm Dassault Aviation was selected for supplying 126 planes to the IAF.
In April 2015 in Paris, realizing the difficulty with the transfer of technology to Hindustan Aeronautics Ltd and to avoid going back to the starting blocks, Mr Modi opted for 36 ‘off-the-shelf’ planes only. The French had probably not realized that ‘off-the-shelf’ can be rather complicated in India.

The babus strike again
The main sticking points raised by the Law Ministry, touched upon the issues of liability, bank guarantees, arbitration and a higher-than-usual offset clause.
A ‘senior official involved with the matter’ (how a babu can freely speak to journalists is a mystery which should be inquired into!) told The Indian Express: “While many senior government functionaries, including those in the ministry of defence, have favoured out-of-box thinking to take the deal forward, when we examined the draft Inter-Governmental Agreement (IGA) and the draft supply protocols, we were left wondering as to how India could agree to all the stipulations suggested by the French side. In our opinion, the two documents were not drafted with the interest of the Government of India in mind.”
What is strange is that while the Minister says that only the price needs to be discussed, the babus’ report speaks of the conditions which “are being heavily loaded in favour of the French nation.”
For the bank guarantees too, The Indian Express’ source asserted that the French government has refused to give any bank guarantees; instead, it has offered to provide a ‘comfort letter’ from its Prime Minister. It is apparently what was accepted during Hollande’s visit to Delhi in January.
The babu’s mindset is also manifest when it objects that while the deal had agreed on Geneva (Switzerland) for arbitration proceedings, the MoD should have pressed for having India as the seat of arbitration.
All this just shows the babus’ deep frustration: they had not been kept in the loop; as a matter of fact, it was precisely why the Prime Minister decided for an ‘out-of-the box’ solution for 36 instead of 126 jets.
On March 10, Defense News, a usually well-informed website, reported that Dassault Aviation was negotiating with Delhi the possibility to build 90 more units with potential local partners. The website quoted the French company’s chairman Eric Trappier: “Dassault seeks to set up ‘a real partnership’ with Indian industry rather a conventional offset, which requires investing in unrelated sectors. That partnership approach would see Safran, Thales and other French suppliers working with local partners on the Rafale if New Delhi agreed the order for 36 and followed up with a further 90 unit. That second order was needed as the former figure was too small to justify a local build.” In other words a ‘Make in India’ scheme!

Dassault's order book
In the meantime, Dassault is talking to Canada, which may drop out from the F-35 program with the US and also Switzerland trying to replace its F-5 and F-18, as well as Belgium, the United Arab Emirates and Malaysia.
The problem for India, as well as for other potential buyers, is that the annual output of the assembly line of the Rafale’ workshop near Bordeaux is 11 units, or one a month, (in August, France does not work!); the output could rise by three units, if India and other countries signed up for the fighter, explained Mr Trappier; further Dassault needs to deliver six Rafales to the FAF in 2016 and one in 2017.
A few days later, while confirming that the Rafale deal with Dassault was still on, Mr Parrikar boasted to be a ‘tough negotiator’ wanting the ‘best price’ for Rafale fighter jets.
It is fine to be a tough negotiator, but Mr Parrikar should not forget that Dassault too is a hard bargainer. Further, the position of the French consortium is not the same as two years ago: Their order-book is full and first ordered, first served, remains the rule.
Last week, defence analyst Ajai Shukla, commented in The Business Standard: “Paris is beginning to acknowledge the possibility that India might not buy the Rafale fighter because of sharp differences over the price, and New Delhi’s insistence on enforceable guarantees regarding the fighter’s delivery, performance and availability.”
Quoting a senior French official, Shukla wrote: “If some people in the MoD do not want to allow the Rafale deal to go through, so be it. We are currently building it for Egypt and Qatar, and we could have another customer in Malaysia.”
It is clearly a poker game, with each party sending ‘feelers’ and vague threats though the media.
But who would be the loser if the deal does not come through?
Undoubtedly both France and India, particularity the IAF, with Air Chief Raha’s melting iceberg melting further due to the change of ‘bilateral’ climate.

The Saudi factor
Quite-worryingly, some news, which passed unnoticed in India, created waves in France: it is the awarding of the Legion d'Honneur, the country's highest honour, to Saudi Crown Prince Mohammed bin Nayef. It sparked a huge controversy in France, which Jean-Marc Ayrault, the newly-appointed foreign minister tried to justify: “It's a diplomatic tradition …there was ‘nothing grandiose’ about the ceremony;” but Saudi Arabia remains one of the world’s worst human rights violator (and suspected by many of financing the IS).
Why honour the kingdom?
The website Intelligence online had perhaps the answer.
In January, it titled: “Riyad wants to lure Paris with a contract for the Rafale”. It quoted a source saying that Prince Mohammad bin Salman, Saudi Arabia’s Defense Minister, appealed to Paris to submit a proposal for the supply of fighter aircraft Dassault's Rafale ‘in the coming weeks’.
Are 72 jets not worth a small medal?
And if the Prince decides, there is no babu in Ryad who will block the contract …and no problem of cash either.
That would mean that the ‘Indian deal’ is further postponed for several years.
Let us hope that once again the Prime Minister will step in and find a way which will be a win-win solution for both countries.

What is ‘terror’ for China?

China does not seem to have the same definition of the word ‘terrorism’ than India and the rest of the world.
It was obvious when a 26-member delegation of the People’s Liberation Army (PLA) headed by General Fan Changlong, Vice-Chairman of China's powerful Central Military Commission (CMC) recently visited New Delhi.
After meeting Manohar Parrikar, India’s Defence Minister, Rear Admiral Guan Youfei, Director General, Foreign Affairs Office in China's Ministry of National Defence broke a surprising piece of news to the Indian Press: “Pakistan is also a victim of terrorism. In the past few years, Pakistan has been fighting terrorism with a lot of casualties,” he affirmed.
Had the visit of General Fan’s delegation to Pakistan earlier in the week influenced this Chinese perception?
Rear Admiral Guan also asserted that Pakistan has in the recent “past started a military operation to fight terrorism with positive achievements.” Was the Admiral speaking seriously?
When asked by a journalist, how China’s 'all-weather friend' could be a ‘victim’ when it harbours and uses terrorists itself, Guan answered, "China will continue to support Pakistan's efforts in fighting terrorism, especially in fighting the Eastern Turkistan Islamic Movement."
Why mention only this nebulous Uyghur group, which, according to Beijing, has been involved in terrorist acts in Xinjiang?
The Admiral expounded on Beijing’s position on terrorism: “There should not be any double standards,” he affirmed.
He was referring to the United States, which, according to Beijing has been ‘interfering’ in the South China Sea region: "The South China Sea in essence is a dispute caused by different understanding and perception on the islands and reefs in the South China Sea," he asserted.
He added that in case of a dispute, “China always stands for negotiations directly between states in the South China Sea region. China does not agree with the interference of countries outside the region in this issue."
Guan also said that China wants to work towards deepening counterterrorism cooperation with India. But for this, one needs to have the same definition of ‘terrorism’.
China’s clean sheet to Pakistan comes after November 13, the Dark Friday when Paris witnessed the worst terror attack in France's history: some 132 people were killed and more than 350 injured.
It was only 3 days later that Abdelhamid Abaaoud, the mastermind of the attack in Paris, was killed during a seven-hour raid conducted by French police commandos on a flat in Saint Denis suburb near Paris. The French police action ended in bloodshed with the death of the 27-year-old Belgian IS militant and the surrender of 7 terrorists. Paris Prosecutor François Molins also confirmed that the woman who blew herself up with a suicide vest during the raid (damaging the building's structural integrity) was Abaaoud's cousin.
The situation was so bad that the French Parliament agreed (nearly unanimously) to a 3-month state of emergency, giving greater powers to the police to deal with the threat.
How can China give a certificate of good conduct to Pakistan, the terrorist state par excellence, when such tragic events have just occurred?
To understand Beijing’s mindset, one should read an article which appeared in the China Tibet Online. It is entitled: “Ugliness of western politicians in contrast to Xi Jinping’s message of condolence”. The article explains: “Chinese people express strong indignation and condemnation towards terrorist acts. Chinese President Xi Jinping immediately sent a message of condolence to French President Hollande saying, ‘We strongly condemn such barbaric acts’.”
The author however continues: “In contrast to Xi Jinping’s message of condolence, western politicians reacted differently to the violent terrorist incidents taking place in China.”
It then refers to the unrest in Tibet in 2008 and compares the events in Paris with what happened in Lhasa and other parts of Tibet in the Spring of 2008. The article asserts: “The March 14 Lhasa riots: French politicians were the most heartless!”
After giving its own version of the incidents which occurred on the plateau, the website explains: “After the incident, the United States, Britain, Germany, France and other countries, didn’t have the slightest sympathy for the victims [read the Han population in Tibet], nor express the slightest condemnation against the terrorists.”
The article quotes the then US presidential candidate Barak Obama: “We express concern and condemnation towards the Chinese government’s repression and arresting of demonstrating monks. We urge the Chinese government to respect basic human rights in Tibet and to account for the whereabouts of the detained monks.”
Nancy Pelosi, the Speaker of the House of Representatives, who was recently in Tibet, committed the worst crime according to China: shortly after the unrest had taken place, she visited the Dalai Lama in Dharamsala and expressed “her support for a non-violent stance and calling for the establishment of an international independent investigation into finding out the truth.”
It also cites British Prime Minister Gordon Brown, Foreign Secretary David Milliband, German Chancellor Angela Merkel and French President Sarkozy, ‘the most heartless’ according to Beijing; he had dared to speak about the boycott of the Beijing Olympics opening ceremony.
What to conclude?
It is clear that the definition of ‘terrorism’ is not the same in Paris and in Beijing. It was so in 2008, it remains so today.
China Tibet Online concludes: “Opposing all forms of terrorism has been China’s position all along.”
Can Tibet’s situation be associated with the IS’s barbaric actions?
Beijing forgets that Tibet was a peaceful independent country when the PLA marched into Eastern Tibet in October 1950. Mao’s objective was to ‘liberate’ the Tibetans, but when the latter didn’t agree to be 'liberated', China used brutal force. During the uprising in Lhasa in March 1959, according to Chinese figures, 87,000 Tibetans were killed in a couple of weeks.
Are Tibetans ‘terrorists’ for resisting their own 'liberation'?
At the same time, the killing by the IS of Fan Jinghui, a 50-year-old Chinese, who was involved in advertising and TV production and had been captured in Syria, should be condemned in the strongest terms and in this case, the words of President Xi are right: “China firmly opposes terrorists of all forms and resolutely cracks down on any crimes that challenge the foundation of human civilisation.”
The Chinese President was attending the APEC Meet which, as a rare gesture, called for more solidarity to combat global terror: “Under the shadow cast by the terrorist attacks in Paris, Beirut, and against Russian aircraft over the Sinai, and elsewhere, we strongly condemn all acts, methods, and practices of terrorism in all their forms and manifestations,” the joint declaration said.
But how can China mix up real terrorist acts like in Paris (or elsewhere) with the aspiration of the Tibetan people for more freedom?
Liu Zhongmin, an expert on the Middle East at Shanghai International Studies University, told The South China Morning Post that even if Beijing was feeling global pressure to take action against terrorism, “It is very unlikely China would initiate military action over this incident [Fan Jinghui’s killing] …Even if China wanted to, conditions do not allow it.”
For Beijing, apart from the ideological confusion about the term ‘terror’, the issue is rather complicated due to its policy of ‘mutual respect for each other's territorial integrity and sovereignty,’ born out of the Panchsheel doctrine. In any case, Beijing needs to do some homework and clarify to the world what it considers as ‘terrorism’.
At the time of Admiral Guan’s statement, Colonel Santosh Mahadik was killed in a gun battle with militants in Kupwara district of Jammu and Kashmir. The 38-year-old Mahadik is the second Commanding Officer (CO) to die in a terrorist encounter this year. Col Mahadik, who belonged to the 41 Rashtriya Rifles was chasing heavily-armed terrorists, who had infiltrated across the LoC.
Can China still say that Pakistan is the victim?

The Rafale deal is Modi's 'masterstroke'

My article The Rafale deal is Modi's 'masterstroke' appeared last week in Rediff.com.


Here is the link...

Under the present Defence Procurement Procedure, it would have been a nightmare, and a long, long one at that, to build 108 Rafales in India. Modi realised this and took the wise decision, though it is a definitive setback for his Make in India scheme,' says Claude Arpi.

Has the Congress started using the Aam Aadmi Party's tactics? You make any allegations against your opponent, whether true or not, and the media believes you; at the worst, nobody will check the veracity of your declarations.
It is the way the Congress trained its best gunners on the Rafale deal. According to PTI: 'The Congress alleged non-transparency in the multi-crore Rafale deal and questioned the Centre's move to bypass defence procurement procedure in the absence of inter-governmental agreement with France.'
The news agency quotes Congress spokesperson Tom Vadakkan, who 'informed' reporters in Goa: 'Till date, even the price of aircraft has not been disclosed by the Modi government. India does not have inter-governmental agreement with France for government-to-government purchases.'
There was no clarity even on the transfer of technology agreement, Vadakkan added.
The former defence minister, probably upset with his successor who was reported to have said that A K Antony had 'killed the deal by making several notings on the file,' also participated in the blitzkrieg: 'The present government has compromised our national security.' Antony also criticised the deal for the French fighter plane.
But let us come back to the facts.
First, no contract has been signed so far, negotiations are still on between the French team nominated by President Francois Hollande and its Indian counterpart. The details of the talks are not known, except that France agreed to a 25 per cent 'discount on its earlier offer for an off the-shelf purchase of 36 Rafale aircraft: This will be the base on which further negotiations will take place,' a French source told the Economic Times.
The basic price of the aircraft should be the same as the one paid by the French air force for a similar configuration.
'The overall cost is not expected to cross $8 billion for the entire 36 aircraft fleet,' ET added. The final price will include the cost of the aircraft, and also include maintenance facilities, training of pilots and technicians, some armaments and spares.
It is what is presently being negotiated.
Details of government to government talks are never made public during the negotiations; it is the normal procedure.
How did the 'deal' reach this stage?
On April 9, 2015, an Indian delegation arrived in Paris, ahead of Prime Minister Narendra Modi. Till that time, discussions were still on for the 126 planes (the bone of contention being the 108 planes to be manufactured by Hindustan Aeronautics Limited in Bengaluru), but the negotiations had reached a dead-end as Dassault was not ready to take on the responsibility for the work done by HAL and there were too many uncertainties/complications in the Defence Procurement Procedure to make the deal viable.
Modi's decision to purchase 'off-the-shelf' was a quick, pragmatic, and smart move. He brought the IAF's 'critical operational necessity' on the negotiating table, while dropping the Medium Multi-Role Combat Aircraft framework. We shall see why.
Prime Minister Modi confirmed the decision for a government to government deal during his press conference with President Hollande.
A few days later, Defence Minister Manohar Parrikar hoped that the Rafale would be inducted into the IAF in two years's time, adding: 'India has finally broken the ice over the deal which has been pending for the last 17 years.'
The Congress's accusation, that there is no procedure to by-pass the Defence Procurement Procedure, is absolutely wrong and it shows that Congress leaders have not done their homework.
Article 71 of the Defence Procurement Procedure deals with the possibility of direct purchase: 'There may be occasions when procurements would have to be done from friendly foreign countries which may be necessitated due to geo-strategic advantages that are likely to accrue to our country. Such procurements would not classically follow the Standard Procurement Procedure and the Standard Contract Document but would be based on mutually agreed provisions by the governments of both the countries.'

Article 72 further confirms the advisability of direct purchases in some cases: 'In cases of large value acquisition, especially that requiring product support over a long period of time, it may be advisable to enter into a separate inter government agreement (if not already covered under an umbrella agreement covering all cases) with the government of the country from which the equipment is proposed to be procured after the requisite inter ministerial consultation. Such an inter governmental agreement is expected to safeguard the interests of the Government of India and should also provide for assistance of the foreign government in case the contract(s) runs into an unforeseen problem.'
In the case of France, though it may not be considered as an 'umbrella' agreement, there is an 'agreement on defence cooperation' signed on February 20, 2006, by Pranab Mukherjee, then defence minister, and his French counterpart (Madame Michele Alliot-Marie). Article 4-3 says: 'The defence equipment sub-committee shall organise and direct cooperation in the field of equipment. It shall also be responsible for examining the issues relating to export controls of defence equipment and related items.'
Further, Article 73 of the Defence Procurement Procedure mentions a special procedure on 'strategic considerations:' In certain acquisition cases, imperatives of strategic partnerships or major diplomatic, political, economic, technological or military benefits deriving from a particular procurement may be the principal factor determining the choice of a specific platform or equipment on a single vendor basis.'
In this case, the IAF's 'critical operational necessity' was the imperative.
India regularly buys equipment from the US in a similar manner under the foreign military sales programme (for example, six Lockheed Martin C 130J transport aircraft were thus inducted in 2011. By who, did you ask? Why, by Antony himself!). The condition is that each deal is treated separately. With Russia, contracts are negotiated through a government agency called Rosoboronexport.
Major General Mrinal Suman, one of the foremost Defence Procurement Procedure experts, confirms that in any case 'a separate inter government agreement has to be signed for every deal.'
In the present case, it will be done when both parties will have agreed on the details (price, delivery, conditions, etc). General Suman adds: 'I think it was a master stroke by Modi. There will be no bribes and no middlemen. Further, it will be for the French government to negotiate price with the manufacturers and deliver the planes to India. Most importantly, the deal will carry the sovereign guarantee of the French government.'
As for HAL, the situation is complicated, and everyone agrees that it would have not been possible to build 108 jets in Bengaluru in the required time delays.
A couple years ago, Wing Commander I M Chopra, a former HAL chairman, explained to me one of the many difficulties: 'HAL is a vertically integrated company. Practically every item is made in-house, ranging from accessories, avionics, and engines to aircraft. It is a management nightmare. No company in the world attempts such vertical integration. About 60, 70 per cent of a Boeing aircraft is made by subcontractors. When I tried to get engine fuel pump components for the Jaguar made by MICO, Bengaluru (a Bosch subsidiary), it was a non-starter because we needed manufacturing tolerance of five microns and MICO had experience of working with 25 microns.'
'I think now, 20 years later, it would be possible to induce the private sector to set up high-tech units for building accessories etc,' Chopra added. 'It should be possible also to subcontract high technology work as I believe a few companies have set up machining centres with very modern CNC machines. Such companies have started taking up defence sector work. All of us are interested in indigenisation but there are difficulties to achieve it in high technology items.'
Under the present Defence Procurement Procedure, it would have been a nightmare, and a long, long one at that, to build 108 Rafales in India. Modi realised this and took the wise decision, though it is a definitive setback for his favourite 'Make in India' scheme.
Interestingly, recently, Xinhua commented on the purchase of the Rafales by India. The Chinese news agency wrote: 'The fighter established its reputation with airstrikes against targets in Libya in 2011 when it proved capable of carrying out a mission lasting a total of nine hours and 35 minutes with an in-flight refueling. In 2013, the fighter's twin engines proved they could withstand the heat of the Sahara when France attacked rebel camps in eastern Mali. The aircraft has also been outstanding in reconnaissance and precision bombing in Iraq, where it is one of the main aircraft used in airstrikes against Islamic State.'
'The aircraft's aerodynamic design, avionics and engines are superior to its Chinese counterpart, the Chengdu J-10, which has entered service with the PLA,' Xinhua admitted, to conclude that the Rafale also has 'the capacity to carry the ASMP-A, a cruise missile that can be fired as a warning shot before a nuclear strike. Both India and Pakistan are nuclear powers, but the means to deploy nuclear weapons is crucial in establishing a credible deterrent.'
Congress leaders should not forget this either.

The benefits of having a Gujarati prime minister

My article The benefits of having a Gujarati prime minister is posted in Rediff.com.

Click here to read...

Narendra Modi knows how to calculate and remain pragmatic.
Take the unexpected Rafale deal -- perhaps the first time a PM has considered the country's defence procurement as a priority, over the considerations of the babus' and over his own 'Make in India' project,' says Claude Arpi.

The advantage of having a Gujarati prime minister is that he knows how to calculate and he remains pragmatic.
Take the unexpected Rafale deal agreed in Paris during Narendra Modi's visit. It is perhaps the first time that a prime minister has considered the country's defence procurement a priority, over the considerations of babus' and over his own pet project 'Make in India', which will now be delayed for years, as far as the technology transfer for the Rafale is concerned.
The move was particularly pragmatic because it will cost less to India's exchequer. Buying 36 Rafales 'off-the-shelf' will cost some 4 billion Euros, which means one-fourth or one fifth the original plan to 'Make in India' 108 planes with Hindustan Aeronautics Ltd, a government undertaking always prone to delays and over-costs.
Further, it will bring the required 'oxygen' for the Indian Air Force which faces two rather aggressive neighbours with a rapid depletion of its fleet.
Defence Minister Manohar Parrikar, who did not accompany the prime minister on his trip (Modi travelled without a single minister, the senior-most member of his delegation being Ajit Doval, the national security advisor), said that it is a 'great decision.'
He hoped that the Rafale will be inducted into the IAF in two years time, adding that: 'India has finally broken the ice over the deal which has been pending for the last 17 years.'
Parrikar had it wrong, it is 14 years, but that is a detail.

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Can Modi Make it in India?

My article on the Aero India 2015 in Rediff.com

'It appears that Prime Minister Modi has to undo 50 years of State monopoly in the defence sector during which public undertakings like HAL or DRDO monopolised defence production and development with disastrous consequences.'
'It is high time the Indian private sector brings its dynamism into play and gives Mr Modi a boost to realise his Make in India dream,' reports Claude Arpi from Aero India 2015.

As Aero India 2015, organised on the theme 'Make in India', concluded at Yelahanka Airport in Bengaluru, it is perhaps time to take a fresh look at India's development and problems in aerospace, defence, civil aviation and defence manufacturing.
The 2015 show was a big one: More than 700 companies participated; big players like Israel, Russia, France and the United States came to Bengaluru with impressive armadas of equipment and staff.
A telling incident: As I was walking through the stands, a French exhibitor said how impressed he was by India. "Do you know in France, we have only a couple of publications devoted to aviation/defence. I am surprised to see so many here," he said.
I tried to enumerate a few and reached nearly ten. Later I enquired with a retired air marshal of the Indian Air Force, he smiled and told me: "You are wrong, we have 37 publications."
During the air show, some of them published a daily update of several pages, edited at night between Bengaluru and Delhi and printed in the IT City for free distribution the next morning at 9 am.
It does show the extraordinary vitality of the defence sector in India. It is true that the theme of the 2015 edition of the air show -- 'Make in India' -- was particularly exciting for the professionals.

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The Rafale Saga

Very few in India know the meaning of the French word ‘Rafale’, which is now associated with the supply of 126 Medium Multi-Role Combat Aircraft (MMRCA) to the Indian Air Force (IAF); ‘rafale' means a 'gust of wind'.
When the 'rafales' prevailed in the MMRCA competition, many thought that the Big Deal would soon be signed; three years later, it is still going through tough procedural ‘gusts of wind’. The reasons are not the qualities of the combat aircraft, but other complications.
Out of the 126 aircrafts to be supplied to the IAF, 18 planes are to be manufactured by the French supplier, Dassault Aviation, from its facilities in France, while the remaining 108 planes have to be built in India, under a large Transfer of Technology agreement, by Hindustan Aeronitical Ltd. (HAL).
Till recently the French side seemed very optimistic. In November, Eric Trappier, Dassault’s Chairman declared that his firm expected to conclude a deal by March: “The final phase of exclusive negotiations on the contract should conclude within India's current budget year ending in March 2015.”
He added that this date was a ‘reasonable goal’.
On December 2, when this writer interviewed the French Defence Minister and asked about the pace of the negotiations, Mr. Le Drian said: “The negotiations are proceeding well. For a project of this scale and such complexity, which brings the transfer of numerous know-hows to several industrial stakeholders of India, the pace is comparable to that of other negotiations. Both our Governments share the will to conclude it and this is, of course, essential.”
In January 2012, the French firm Dassault Aviation had been selected for supplying 126 MMRCAs to the IAF. The Rafale fighter had gone through a long competitive process which lasted five years, with the American F/A-18 and F-16, Russian MiG 35, European Eurofighter and Swedish Saab Gripen in the race.
While the initial Request for Information had been issued in 2001, the Request for Proposal (RFP) was only issued in 2007, as the then minister, AK Antony wanted to add new clauses, such as the Total Life-cycle Costs, in the Indian defence procurement policy. This is where the ‘complications’ started.
It is not always easy to follow the intricacies of the Rafale saga, since Dassault is, as the French say ‘muet comme une carpe’ (‘silent as a carp fish’ which makes bubbles with no sound); and the Indian Ministry of Defence and the Indian Air Force are not very loquacious too; it is understandable in view of the high stakes.
One can however gather from the Indian press that the main disagreement raised by the French is that Dassault is not ready to take the ‘full responsibility’ for the 108 fighters to be manufactured in India by HAL, while there is apparently no issue with the 18 fighter planes to be manufactured in France by Dassault.
An Indian defence ministry official told some Indian journalists (on the condition of anonymity, as usual): “The ministry is in no hurry to conclude the negotiations despite what people may say. Dassault has to accept commitment mentioned in the RFP.”
Another ministry insider said that Dassault was not agreeing to HAL’s demand to take responsibility for the manufacturing process in India, “regardless of French government’s pressure, [Dassault finds that] it is too risky”.
The same senior Indian MoD official added: “accepting terms and conditions of the original tender have emerged as the key issue to be resolved. The RFP clearly stated that under the transfer of technology agreement, the French will have to …take full responsibility of Indian manufactured fighter jets.”
The negotiations seem stuck on the imposition of penalties in case any delay occurs in the supply of the aircraft manufactured by HAL.
The question is: can Delhi ‘legally’ impose liabilities on something over which Dassault has no control? This sounds like one of these clauses drafted during the Antony Raj, where the ‘foreign’ supplier has to pay’.
This is also true for the Civil Liability for Nuclear Damage Act, which will be discussed during Obama’s visit later this month. The Economic Times recently editorialized: “India should bring its liability law in line with international norms. It makes little sense to keep nuclear suppliers’ liability open-ended and unlimited. This is what has held back vendors from the US, Japan and elsewhere from concretising their India plans.”
This does not solve the Rafale issue.
Ajia Shukla writes in The Business Standard: “For the first time since January 31, 2012, …a top Indian official has admitted serious problems in negotiating the purchase with French vendor, Dassault.”
Defence Minister Manohar Parrikar indeed spoke of ‘complications’ in the negotiations “with the French side reluctant to meet commitments that the IAF had specified in the tender”. Parrikar announced India’s Plan B: “The Su-30MKI is an adequate aircraft for meeting the air force’s needs”.
It is only a bluff or is the IAF serious?
Earlier this month, the Indian minister had assured his French counterpart that the Rafale negotiations would be placed on a ‘fast track’. More recently, he asserted that Le Drian “had committed to send an empowered person to negotiate after New Year.”
Now it appears that a French ‘empowered’ delegation is likely to visit India to take forward the negotiations. One could however ask: empowered' by whom?
Dassault Aviations is a private limited company, the last aviation group in the world still owned by its founding family, who owns 51% of the group’s shares (while EADS France – Airbus Group has 46%).
Could someone outside Dassault Aviation be ‘empowered’?
Would Delhi like to deal with an official of the French Ministry of Defence?
In which capacity would that person negotiate? Can the French State guarantee the liabilities of a private limited firm? All this seems rather complicated.
Since 1999, Dassault’s main activity has been the export of business jets (Falcons). In 2012, 71% of the revenues came from the sales of the Falcons, while the Defence sector (export) is less than 5%. Is Dassault ready to take the risk to spoil its ‘civilian’ branch by guaranteeing the Rafale deal? Of course, it is up to the familial firm to decide.
When Mr. Parrikar recently declared, ‘we are in a mess that I can't spell out’, was he thinking of this Deal?
There is no doubt that Dassault’s defence branch badly needs the Rafale order to survive, while the Indian Air Force desperately has to replace its ageing MiG-21s with a modern fighter. The IAF is aware that HAL’s LCA, the Tejas does not fit the bill; further the IAF which has today a sanctioned strength of 45 fighter jet squadrons, has only 25 operational squadrons.
The ‘Rafale Deal’ would be indeed a win-win for both India and France …if signed. Let us hope for the best.

‘Our cooperation can go far’ says Le Drian

Jean-Yves Le Drian presents a photo of WWI to Manohar Parrikar, his Indian counterpart

My interview with the French Defence Minister, Mr. Jean-Yves Le Drian appeared in exclusivity in today's edition of The Pioneer.

‘Our cooperation can go far’

Paris is upbeat on the potential that exists to enhance India-France defence cooperation through the 'Make in India' campaign, and on an early resolution of the various defence deals that are there in the pipeline
French Defence Minister JEAN-YVES Le DRIAN’s two-day visit to India was to meet his new Indian counterpart and also give a push to India-France defence collaborations. 
He spoke extensively to The Pioneer on the road ahead. 

Excerpts from the interview:
Mr Minister, what is the main purpose of your two-day visit to India?

First, it is to meet my new Indian counterpart, Mr Manohar Parrikar, just two weeks after the warm meeting between President Hollande and Prime Minister Modi. France and India share a wide range of common interests. Our strategic partnership, developing since 1998, when the BJP was in power, includes defence and security. It is important for our two countries to discuss our security concerns and our respective defence policies. I firmly believe that the defence partnership between two nations, that cherish their independence, strengthens their respective strategic autonomy.
I have suggested to Mr Parrikar that we consider subjects of common interest, whether to do with international matters or defence policies, and these discussions have been extremely positive — as always between India and France — and marked by mutual trust and respect.
We have important projects before us — such as the MMRCA — but that’s not all. Through unparalleled transfers of technology and their industrial impact, our projects will contribute to the Make in India programme in the defence sector, an area in which France already possesses major expertise. My trip particularly aims to see how the French defence industry can, in mutual interest, contribute to Make in India.
Also, in this centenary year of World War I, I wished to pay tribute to Indian soldiers who fought on our soil for France’s freedom. Some 8,500 of these soldiers perished on our battlefields. We also haven’t forgotten those who fought in other theatres of war.

What are the recent developments in the defence policy of the French Government? Where does India figure in this dispensation?
There is, first of all, France’s resolute engagement in external theatres of operation against terrorism, namely in the Sahel, against Al Qaeda-linked outfits, and in Iraq, against the Daesh. Following our 2013 White Paper on Defence and National Security, which I presented in New Delhi, we reiterated our readiness to contribute to security in Asia, especially in the Indian Ocean, which is a major interest for both our countries. We also devote especial efforts to intelligence, cyber security, and space.
With India, our cooperation can go very far. Prime Minister Modi has pressed for a global initiative against terrorism, which goes well beyond defence issues. This is something that interests us. As for armaments, an area in which we have been cooperating for the past sixty years, India is a very important partner. And this partnership can assume an unprecedented industrial and technological dimension in the years to come.

Are you satisfied with the pace of the negotiations for the contract for the 126 MMRCAs between Dassault Aviation and the Government of India? What about the naval version of the Rafale (Rafale-M)?
The negotiations are proceeding well. For a project of this scale and such complexity, which brings the transfer of numerous know-hows to several industrial stakeholders of India, the pace is comparable to that of other negotiations. Both our Governments share the will to conclude it and this is, of course, essential. The faster the contract is finalised and signed, the faster the jets will roll out of India’s manufacturing facility. Hindustan Aeronautics Limited will possess the technology and the licence to manufacture additional aircraft, which could, moreover, be exported. Thus, cutting-edge technology will be transferred to India, with production in India.
The naval version of the Rafale is identical to the air force version. You see, the Rafale is truly an ‘omnirole’ aircraft. Just a few additional equipment, such as the landing gear, has to be supplied by French manufacturers. I want to underscore Rafale’s omnirole aspect. We have currently deployed this fighter jet for not only air defence missions, as in the recent case of providing air security for our Baltic allies, but also reconnaissance flights and air strikes in the Sahel and Iraq. No competitor of the Rafale can claim to have been tested so much operationally in such widely varying situations. And we manage to achieve this with an extremely high fleet availability level because of the Rafale’s great qualities.

What about the other projects in the field of submarines, missiles, transport systems? Will France be ready to participate in a Make in India project?
I won’t enter into the details of every project. What strikes me the most is the intensity of our cooperation, technology transfers and co-developments. All these ongoing and future projects well fulfil the objectives of Make in India.
Let’s take two examples. The Scorpene is the first project in the world that provided for transferring manufacture to India from the very first submarine. This explains the programme’s delay, which is actually much less if we compare it to that of other ships, which involved far lesser complexity. Plus, there are no cost overruns. The project costs strictly adhere to what the French Government had announced to the Indian Government during negotiations. Moreover, they are lower.
The cooperation between French and Indian manufacturers is excellent, and I am confident of the project being concluded successfully. We are ready to consider any other project that India may wish to launch for stealth submarines, equipped with appropriate missiles.
The other example, the short-range surface-to-air missiles project was conceived to meet the expectations of our strategic partner, India. It aims to provide the Indian Armed Forces with cutting-edge technologies in the long term to enable them to possess the most high-performance systems. The SRSAM performances are unmatched by other missiles in this category. But the idea is also to have these missiles manufactured entirely in India, autonomously. To this end, we have decided together that the source codes of these systems will be shared. The contract has been ready for signing since March 2012.
Then there are partnerships between companies, such as Tata and Airbus on military transport aircraft, which, once concluded, could pave the way for more ambitious tactical transport projects.

Are there any other important defence projects that you have discussed with your Indian counterpart?
In April 2015, we will hold a major aero-naval exercise, Varuna, off the Goa coast, which will enable us to exchange notes on our respective modes of action. This will be France’s maiden aero-naval exercise in the Indian Ocean, and we are doing it with India. Preparations are afoot between our respective Navies. I would like the nuclear-powered aircraft carrier, Charles de Gaulle, to participate.

What about France’s military budget as some cuts have been announced in the Defence Multi-Year Spending Law (‘Loi de Programmation militaire’)?
Quite the contrary. We are one of the few European countries to maintain our defence capabilities at a very significant level. I regularly call for European countries to make greater efforts. The military budget law you referred to has sanctioned spending for five years, in keeping with France’s role in the world and contribution to international security. I have just announced the acquisition of Airbus mid-air refuellers for our strategic air command. This includes the development of new independent technologies and the maintenance of nuclear deterrence capabilities in both its aerial and underwater dimensions.