Army Chief warns against govt-to-govt deals with US

Discussion in 'Indian Army' started by Oracle, May 25, 2010.

  1. Oracle

    Oracle New Member

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    NEW DELHI: For the first time since India began big-ticket defence purchases from the US through government-to-government route, a senior member of the security establishment has red-flagged them, calling attention to the serious pitfalls of it.

    In an unusual reflection of Army's frustration with its past FMS (foreign military sales) purchases from the US, Army chief General V K Singh has written to defence minister A K Antony, cautioning the government about the troubles with FMS.

    Over the past few years, the Indian defence establishment has been using the FMS programme of the US government to carry out major defence acquisitions.

    In these non-tender purchases, the US government procures the equipment on behalf of the Indian government from its military companies, and takes a commission for the services rendered through Pentagon's Defense Security Cooperation Agency (DSCA).

    The purchase of AN/TPQ-37 firefinder weapon-locating radars for the Army in 2002 was the first major deal that India did with the US under FMS in several decades. Ever since, India has been buying several major defence systems regularly, and the total contract value of US systems bought under the FMS deal runs into several billion dollars.

    The Army chief's letter of caution comes at a time when the two sides are in the final stages of finalizing two major FMS purchases — one for the Army and the other for the IAF. The Army is proposing to buy 145 ultra light howitzers worth about $647 million, mostly for deployment along the China border, while the IAF is planning to buy 10 C-17 transport aircraft at a cost of over $2.2 billion.

    Singed by the troubles with past FMS contracts, the Army top brass is now discussing the possibility of hiring corporate lawyers well versed in international negotiations and contracts to come on board for scrutinizing the upcoming contract for howitzers, authoritative sources said. These lawyers would ensure that the past troubles are kept away, source said.

    Gen Singh is believed to have pointed out to Antony Army's trouble with maintenance of a dozen weapon-locating radars bought from the US firm Raytheon. At times, up to two-thirds of the radars have been in want of maintenance, Army sources said.

    Gen Singh's letter to Antony is an unusual step, and was "forced by the troubles we have with maintenance of the radar systems", an Army source said.

    India has been using the non-tender, FMS route to buy big-ticket defence items from the US since 2002, when the radars became the first items to be bought under the scheme in recent memory. Over the past eight years, the military has carried out a host of acquisitions through the route. Among them were the $2.21 billion purchase of eight Boeing P-8I maritime reconnaissance aircraft, $962 million deal for six C-130J Hercules transport aircraft for IAF and $88 million for USS Trenton and accompanying helicopters for the Navy.

    The IAF is currently in the final stages of negotiations for purchase of $2.2 billion worth 10 C-17 aircraft and the Army is finalizing the purchase of howitzers.

    http://timesofindia.indiatimes.com/...to-govt-deals-with-US/articleshow/5970446.cms
     
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  3. nrj

    nrj Stars and Ambassadors Stars and Ambassadors

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    In this FMS, Army officials won't be enjoying any kick-backs so this frustration very natural. What advantage Armed Forces should in FMS is the lesser delay compared to looong tender process.
     
    Last edited: May 25, 2010
  4. nitesh

    nitesh Mob Control Manager Stars and Ambassadors

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    Well this is one side of it :) but I think he is pointing towards spares availability
     
  5. nrj

    nrj Stars and Ambassadors Stars and Ambassadors

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    Spares issue is critical. Spares availability + EUMA are major risks in US toys. But, I guess he's digging out the maintenance records of FireFinders to cement his view.
     
  6. AJSINGH

    AJSINGH Senior Member Senior Member

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    any proof my friend , please back it up ,otherwise it is just your opinion
     
  7. AJSINGH

    AJSINGH Senior Member Senior Member

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    I think Army Chief is right here ,well you see whatever we have bought from US such as C-130J or C-17 is through FMS, so these yankee products have not gone through the usual etnder process ,other wise AN-124 or IL-476 would have won the contract because they are cheaper by 60% and we all know that Finance Ministry will also finance the cheaper weapons products
     
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  8. nrj

    nrj Stars and Ambassadors Stars and Ambassadors

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    Proof for what? Kick-backs won't awarded in FMS or Armed forces receive kick-backs in foreign deals?
    Get familiar with the defense scandals which already happened in past, trend is similar all over.
     
  9. nrj

    nrj Stars and Ambassadors Stars and Ambassadors

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    or Russian AN124/IL76 & US C-17/C-130 are quite different products at the levels of MOD preference ....

    or MOD wants to understand Western tech .....

    or Armed Forces/MOD tired of time consuming Russians deals & has decided to end Russian dominance in Indian defense deals ....
     
  10. AJSINGH

    AJSINGH Senior Member Senior Member

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    AN-124 is way better than C-17 and much cheaper ,,well if you theory is right " Armed Forces/MOD tired of time consuming Russians deals & has decided to end Russian dominance in Indian defense deals .." then why did we buy akula or AC or will be buying PAK FA , or Mig29K ...we still depend of russia and will continue to do so ,even if USA comes into picture
     
  11. nrj

    nrj Stars and Ambassadors Stars and Ambassadors

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    Does AN124 has capability of landing on unpaved runways of shortest lengths? Is AN124 production line still open? What will be Unit/bulk cost today?
    Comparison is fair when we know the requirements set by MOD. Unless parameters known, one can not state the better aircraft.


    Who said about casting out Russian arms? Aim is to let know Russians that we can buy from other countries too & Russia is already facing significant cut in their pie while coming to Indian Defense deals ...
     
    Last edited: May 25, 2010
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  12. Oracle

    Oracle New Member

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    US high-tech arms to India stumble on safeguards

    India's marked shift towards American weaponry is, paradoxically, leading towards a flashpoint between New Delhi and Washington.

    Over the next three months, key American military platforms -- including the AH-64 Apache attack helicopter, the C-17 Globemaster transport aircraft and the M777 ultralight howitzer -- come to India for user trials.

    But New Delhi's reluctance to sign two technology safeguard agreements demanded by the US could lead to India paying top dollar for American equipment that is divested of the cutting-edge electronics, which makes it special.

    With neither side giving ground, negotiations have stalled. Before meeting last week in Washington, the US-India Defence Procurement and Production Group -- which coordinates equipment transfers between the US and India -- quietly removed from its agenda a long-running discussion on the two contentious safeguards:

    The Communications Interoperability and Security Memorandum of Agreement; and the Basic Exchange and Cooperation Agreement for Geo-spatial Cooperation.

    Also threatened by this continuing stand-off is the transfer to India of crucial avionics, satellite navigation aids, and secure communications equipment that power two advanced American platforms that India has already bought:

    The P8I Poseidon multi-mission maritime aircraft; and the C-130J Super Hercules transport aircraft.

    US law mandates that certain sensitive American electronics can only be transferred abroad after the recipient country signs the CISMoA and/or the BECA. But, New Delhi treats all defence agreements with the US as political hot potatoes.

    Last year, India reluctantly signed up for an End-User Monitoring Agreement with the US after extended negotiations that eventually kept American inspectors away from Indian military bases.

    Simultaneously, New Delhi flatly rejected a US proposal for a Logistics Support Agreement that would have formally allowed US forces ready access to Indian logistics.

    The EUM agreement and the LSA faced vocal domestic opposition, notably from the Left.

    Manohar Thyagaraj, a security analyst who studies the US-India strategic relationship, explains: "Foundation agreements such as CISMoA and BECA are required by the US law for providing another country with the most advanced electronics on US weapons platforms.

    These agreements are common for all countries that receive US high technology and are not unique to India."

    The CISMoA, signed between the US and Korea in October 2008, aims 'to promote tactical systems interoperability' between the two armed forces by allowing the US Department of Defense to provide

    'Communications Security Equipment' to protect sensitive data during communications. The Indian Ministry of Defence is apprehensive about permitting the US to fit COMSEC equipment into the platforms that India buys.

    If the stand-off over the CISMoA continues, India's eight P8I Poseidon aircraft, which cost $2.1 billion, will be delivered with a down-rated avionics suite, not the high-end electronics that make the P8I a leader in its class.

    Talking to Business Standard, Egan Greenstein, senior manager for business development, Boeing Defence, explained: "The signing of the CISMoA would be essential for a high-tech system like the P8I. It is absolutely packed with sensitive technologies.

    "The US wants to share these technologies with India, but will make sure that they are suitably protected by the CISMoA."

    The growing distance between New Delhi and Washington on the CISMoA is causing frustration on both sides.

    A US official complains: "Both sides are just kicking the can down the road, hoping that someone, sometime will see the light and actually do something real about it."

    American vexation was officially conveyed during the visit of US Defence Secretary Robert Gates to Delhi in January, when he urged Prime Minister Manmohan Singh and Defence Minister AK Antony to sign the CISMoA and the LSA.

    Addressing the press after his meetings in New Delhi, a chagrined Robert Gates pointed out: "These agreements have been laying around for quite a while. this is not some new requirement that has just emerged.

    [These agreements] are preponderantly in India's benefit, because they give high-tech systems additional high-tech capabilities. are enablers, if you will, to the very highest quality equipment in the Indian armed forces."

    Since the US Defence Secretary's visit, Washington has written back, using concrete examples -- including the P8I and the C-130J aircraft -- to illustrate to New Delhi what capabilities it will pass up by refusing to sign the CISMoA and BECA.

    The next discussion on these safeguard agreements is likely during the inaugural US-India Strategic Dialogue from June 1 to 4, when India's External Affairs Minister SM Krishna meets US Secretary of State Hillary Clinton in Washington.

    http://business.rediff.com/report/2010/may/25/us-high-tech-arms-to-india-stumble-on-safeguards.htm
     
  13. Yusuf

    Yusuf GUARDIAN Administrator

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    The good General is only talking about the practical problems faced by the army. Wonder why conspiracy theories should crop up because of it. Come to think of it, the US has the right policy of EUM as we see countries like china RE high tech stuff from Russia. The US doesn't want such things to happen to its tech and has a system in place. If it was india specific we could cry hoarse about it. But its not, so if it suits us to by their stuff its fine else look elsewhere. We have to be practical. If at all a middle path is found, then nothing like it. Just like it was done earlier, it could be done now. The US would not want to let go of india and its market so it will come around. India is known to negotiate hard and that is what sometimes lead to delays. So india will push for the max and see what comes out of it. The sooner the US does something the better for it as the MRCA comes down to the business end of the deal.
     
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  14. san

    san Regular Member

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    AN -124 is not in production and its fuel consumtion is way higher than C-17. Also AN-124 is too big to land in most of the border airfield and also may be in Leh. What the size of an AN-124. It will not be able to land in NortEast barring 1 or 2 airfield and also in Ladhak. So why we need it. Also for any new AN-124, Ukraine need to restart the production line. It will take time and mony. How many order is for AN-124 now? None.
     
    Last edited: May 26, 2010
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  15. AJSINGH

    AJSINGH Senior Member Senior Member

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    boieng is in no better situation , union strike and protest concerning about the production line of C-17 ,we could have bought Il-476 ( upgraded ,cheaper and not better but still at 60% the cost of 10 C-17)
     
  16. xuebao

    xuebao New Member

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    Hello, this is great article. I have blog and I thanks to say you thanks. Regards!
     
  17. san

    san Regular Member

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    The problem with C-17 is that product price of each C-17 is too high. Life Cycle Cost of each C-17 will be almost same or little higher than IL-76. Life cycle cost of the IL-76 is higher compared to western aircraft due to the high maintainance incentive and its fuel gazzaling engine.
     
  18. Armand2REP

    Armand2REP CHINI EXPERT Veteran Member

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    At the price tag of $580 million, it is just absurd. C-17 is a good aircraft, no one will deny that. But $1.2 billion just for a pair?? A400M comes in at $80 million, not as capable but you can more than make up for it with numbers. What would you rather have, 10 C-17 or 72 A400M?
     
  19. AJSINGH

    AJSINGH Senior Member Senior Member

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    the IL-76 has been upgraded , to IL-476 with upgraded engines and the life cycle cost has also come down substantially
     
  20. neo29

    neo29 Senior Member Senior Member

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    Government to government deals makes acquisitions of weapons quicker and avoids the headache of govt rules in the middle unlike the long time consuming tender bids. It also leaves less room for corruption by middlemen who are more so involved in tenders.
     
  21. ajtr

    ajtr Veteran Member Veteran Member

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    Does FMS leave any scope of kickbacks to generals and politicians????
     

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