SOURCE: ToI India's newly- acquired American C-130J Super Hercules plane that crashed last week near Gwalior has been under intense scrutiny in the United States and Canada after a Senate investigation concluded that counterfeit parts in the aircraft's display systems could cause it to "lose data or even go blank altogether" in midflight, with potentially catastrophic consequences. A 2011-2012 investigation by the US Senate armed services committee eventually traced the counterfeit electronic parts used in the C-130J, C-27J, and many other US military systems to a company in Shenzhen, China, called Hong Dark Electronic Trade Company. Hong Dark sold the parts at issue to Global IC Trading Group, an independent distributor in the US, which in turn sold it to L-3 Communications Display Systems, which in turn supplied it to Lockheed Martin, the US military's prime contractor for the C-130J. Amid scathing observations by the Senate panel, the US air force suspended and banned Hong Dark in 2012 from competing for government contracts and subcontracts, but testimony before the armed services committee showed stunning lapses in the supply chain and procurement procedures for the military systems, including the C-130J Super Hercules, six of which New Delhi contracted to buy in 2010 for $1.1 billion, around Rs 1000 crores apiece. India has plans to buys six more to augment its transport fleet with the much- acclaimed aircraft, which has won plaudits for its safety record and its versatility. The acquisition enables the Indian military to put boots and supplies on the ground in remote and inhospitable terrain, giving it matchless reach in the region. However, the aircraft display systems itself will now come under scrutiny â€” if it already hadn't been under the scanner â€” although the cause of the Gwalior crash is yet to be determined. The US Senate committee report is withering in its observations not only about US procurement and supply chain system, but also the casual manner in which private contractors treated the issue once the counterfeit parts were detected. The story begins in November 2010 when L-3 Display Systems detected that the company's in- house failure rate for a chip installed on display units used in C-130J and C-27J had more than tripled from 8.5 per cent to 27 per cent. L-3 also noticed that the same part had previously failed on a fielded military plane. The company sent the chips for testing, which resulted in identification of "multiple abnormalities," with the tester concluding that the parts were "suspect counterfeit." "Failure of the memory chip could cause a display unit to show a degraded image, lose data, or even go black altogether," the Senate report said, noting that "unfortunately, L-3 Display Systems had already installed parts from the suspect lot on more than 400 of its display units," including those intended for the C-27J, as well as the C-130J. In effect, what the IAF's court of inquiry will need to look at is whether India received any of the contaminated display units in the six C-130J it bought from the US, and if it did, whether the US, including Lockheed Martin, alerted IAF to it. India's own procurement process, including whether the buyer tracked and followed up the troubles associated with the C-130J, including the Senate's investigation, will also have to be reviewed. At least in Canada, another C-130J customer, a CBC investigation in early 2013 highlighted the troubles with the aircraft's instrument panel, although the government there glossed over the issue initially. But the Senate investigation offers a disturbing picture of people up the supply chain not particularly alarmed at the contamination of crucial display systems with counterfeit parts. According to the senate report (page 35), following the detection of the fakes, L-3 Display Systems on November 4, 2010, issued a part purge notification, quarantining the company's own stock of the suspect memory chips. It did not, however, recommend to its customer that assemblies affected by the suspect counterfeit chips be returned for replacement of those chips. As a result, hundreds of display units intended for and installed on C-130Js and C-27Js included the suspect counterfeit memory chip, well after its discovery by L-3 Display Systems. Lockheed Martin, the US military's prime contractor for the C-130J, does not cover itself with glory either in the episode. The Senate report notes that when L-3 notified Lockheed of the problem, Lockheed engineers discussed the matter internally and decided "no action" was necessary and the display units did not need to be returned for repair. Lockheed Martin also "did not formally notify the Air Force of the suspect counterfeit chip in the C-130J." According to Senate investigators, while Lockheed Martin told the Air Force that the suspect counterfeit parts were "functionally complaint" to authentic genuine parts, the Air Force was apparently not informed that the failure rate of the part had tripled during acceptance and environmental stress testing. The Senate report concluded that since its investigation, hearing and public release of information about the counterfeit chips, the US Air Force had reported that they are aggressively taking action to remove the parts in question, audit the supply chains etc. But as of March 2012, the report noted, Lockheed Martin had removed and replaced only a handful of the display units in the C-130J that are affected by the suspect counterfeit memory chip. The worrying part for Indian defense planners is that the Senate panel talks of several other US military platforms, such as Boeing's P8A- Poseidon â€” a custom-made variant of which has been supplied to the Indian Navy â€” being contaminated with counterfeit Chinese parts. According to the US air force, "approximately 84,000 suspect counterfeit electronic parts purchased from Hong Dark entered the DoD supply chain, and many of these parts have been installed on DoD aircraft.