Saturday, January 17, 2015
Defence Modernization : Can India Get Its Act Together
by Lt Gen Syed Ata Hasnain (Retd)
Over the last few years India’s defense capability in the face of major internal and external challenges has been seriously affected by two aspects. First, the inability to keep pace with rapidly advancing defense technology the world over and second the proven inefficiency to acquire its required wherewithal for war fighting and training to keep its armed forces in a state of readiness. The coming of Manohar Parrikar as India’s Defense Minister has led to some degree of positivity because of his well-known efficiency and technological background, being an IIT graduate. Before delving into analysis about the slew of measures that the Modi government has taken thus far in the defense sector it is good to clarify a few aspects for the common reader because the entire process of equipping and modernizing armed forces anywhere in the world is a complex exercise which is not easily understood by the public. The paralysis in decision making with regard to procurement of weapons and equipment for the armed forces which was witnessed in the last ten years has been the prime reason for the Revolution in Military Affairs and Transformation virtually bypassing India’s security apparatus. The armed forces work on a system of perspective planning which has been in sync with Five Year plans and goes further to incorporate what is termed as the Long Term Integrated Perspective Plan stretching over fifteen years and keeping ongoing and subsequent Five Year plans in perspective. This is because the acquisition process is slow and needs advance appreciation of future requirements with sufficient time to analyze, review, appropriate financial outlays as per availability and carry out mid-course corrections. Acquisition can be from indigenous or external sources depending on availability, suitability and matching of technological requirements.
Defense equipment being expensive needs to have a balanced dwell time in terms of availability in service without it getting redundant too early. It also needs a system whereby progressively advancing technology can be incorporated for upgrades of existing equipment, supply chain of spares even as some equipment gets obsolete but remains useable, and assurance of availability of future modern equipment developed and fielded by armed forces of advanced countries. This is all necessary to ensure that the inventory is not too diversified by frequent acquisition from diverse sources. There is always the problem of status of politico diplomatic relations with nations of potential supply sources. China has a flourishing defense industry but quite obviously the state of relations between India and China does not allow Indian access to this source. The toss-up between the United States and Russia is a perennial issue because India zealously guards its strategic independence which is an objective for dilution by nations of the developed world. Much also depends on the state of the economy of the world or of the broad region (such as West or East Europe) from where the equipment is proposed to be sourced. A weak economic situation may provide opportunities to negotiate deals more robustly. A simple equation to understand this is the fact that sale of 150 F-15 jets to Kuwait provided 6000 jobs within the US defense industry for a period of five years. A major consideration is the state of technology indigenously available. Extremely high end technology, which is necessary in some systems to retain an edge on adversaries or at least match that available with them, may not be available indigenously. This forces us to resort to purchase off the shelf, sometimes at exorbitant cost. The necessity of indigenous research plays a major role and India’s research facilities and the scientific community is perceived to have achieved lesser than desired capability. The indigenous Nag Anti-Tank Missile for example, has been under development since the last twenty five years without fruition. The quality of metallurgy in the country has prevented us from manufacturing long range artillery guns forcing the Indian army to do without the much required replacement or add on to the Bofors 155 mm Howtizers, last acquired in 1987.
The last issue which plays a major role in the field of defense procurement is the procedure itself. India adopts five modes of acquisition as per the procedure; Buy(Indian), Buy & Make(Indian), Make(Indian), Buy & Make (Global and Indian), Buy(Global). The emphasis, however, remains on indigenization. The financial outlay being huge there is intense competition in some categories while very little in others where sources are restricted by availability of desired technology. To secure deals, kickbacks or facilitation money is the norm worldwide in the defense industry. India’s unfortunate experience in this, going back to the Bofors contract and some others has been a major obstacle in the procurement procedure.
How exactly does the arrival of Manohar Parrikar augur positively for this field which has held back the modernization process and put us at relative disadvantage? The analysis must take into account that the current government correctly identified defense procurement as a major issue staring at it in the face. The PM took his time to identify a potentially efficient Defense Minister and in the interim placed the MoD and the Finance Ministry under the most experienced Union Minister, Arun Jaitley. Sources within the Army privately admitted that it was a refreshing change with the user end and the finances both being under a single head. The grounds were therefore well prepared before the PM identified Manohar Parrikar as the man to deliver. It is not easy to grasp the intricacies of defense modernization even for a military professional but it is to Parrikar’s credit that his managerial skills facilitate his decision making and risk taking capabilities, both of which are crucial in this mission. He has ensured that only tweaking the procedure and not whole scale changes are necessary, thus saving crucial time. The single most important aspect of indigenization, under the ‘Make in India’ slogan, is being given its due importance even as the realization is there that this route will be a very long one and therefore it is necessary to Buy (Global) and Buy and Make in India under contract to balance the two. While the DRDO may be perceived to have failed in indigenous delivery there is enough scope in some sectors to renew support to it and give it the necessary muscle. The apparent decision to manufacture rotary wing equipment indigenously while encouraging India’s well known business houses to enter this field is obviously a sound one with the PM’s full backing. The creation of a Skill Development Ministry is with the idea of developing necessary technical manpower to support this ambitious aim.
"As far as new acquisitions are concerned, of Rs.75,000 crore cleared by the DAC (Defence Acquisition Council), Rs.65,000 crore is for Buy (Indian) and Buy and Make (Indian) categories", stated the Defense Minister clearly delineating the priority. However, the realization of this decision will need to be robustly backed up by skilled labor and technology. The very first decision to buy Rs 15,750 Cr worth of 814 artillery guns with the first 100 guns being purchased off the shelf meets the desired balance. Two other crucial decisions by the Defense Minister point towards his constantly revealing understanding. First is the decision to legalize the use of defense agents an aspect permitted but with little procedural transparency. This will facilitate information, negotiations, trials and pricing in a more transparent and legal way; all of which was earlier done with all kinds of middle men with no control. It will also introduce a greater level of transparency on profit margins and margin money. The second important decision in the making is the partial lifting of ban on tainted companies whose apparent misdemeanors are under investigation. This will open up at least the supply chain of spares of crucial equipment such as Tatra trucks. It will also be a major change in the procurement environment where companies use unethical means to get back on their competitors who may have secured contracts.
Defense procurement remains a veritable minefield but possibly in seven months the new government has come a long way in providing some positive strokes to a very negative environment. Manohar Parrikar has the temperament to master the system but needs time to root out one of the most inefficient systems in India’s security set up. He needs to be fully supported in his mission.
On express request from Dainik Bhaskar I write quite often for this paper and it is translated into Hindi. This is a novel way of allowing thoughts on defence and security reaching the non English reading public. Dainik Bhaskar has 50 editions in 11 states and I get back more feedback from this route than from the English reading public.
Ata Hasnain (Retd)
This article was written for Army Day. In Hindi it can be found at