Putin's India visit march 2010

[A.V.]

Prime Minister Vladimir Putin will push India to double its payment for renovations on a long-delayed aircraft carrier, while also trying to conclude other deals for arms, nuclear energy and communications during a two-day visit beginning Thursday.

New Delhi is the largest foreign buyer of Russian defense equipment, particularly aircraft, and Putin will be looking to shore up that cooperation in talks with Prime Minister Manmohan Singh during his first visit to India since January 2007.

He is also slated to meet Indian President Pratibha Patil, the government press service said in a statement Tuesday.

But the biggest issue on the agenda are cost overruns and delays to refit and deliver the Vikramaditya aircraft carrier, as the Soviet-built Admiral Gorshkov is now known. Problems with the project have been a regular thorn in generally solid bilateral ties.

A source close to state arms export monopoly Rosoboronexport told The Moscow Times that Putin would push India to sign a $2.3 billion deal to finish upgrades, which were originally expected to cost just $970 million.

The initial $1.6 billion contract, signed in 2004, would have seen the renovated carrier delivered to India in 2008 along with fighter jets that are now part of a separate contract. After years of wrangling over delays, India agreed in 2008 to another $1.2 billion in work on the carrier, with delivery pushed back to 2012.

The final price of $2.3 billion is less than the $2.7 billion total for renovations that Russia had been seeking.

Work on the Vikramaditya took so long to agree on because the Russian side did not realize how long it would take or what the costs would be, the source close to Rosoboronexport said.

"The agreement was signed in a rush. It wasn't quite clear what the weapon was and in what condition it was being sold," the source said. "Then the Russian side realized it would take longer and would cost more to finish it, and it took them more than a year to explain to the Indians why exactly they should pay twice the agreed amount."

Vladimir Pastukhov, head of the state-run Sevmash shipyard doing the work, resigned in 2007 when the underestimates and possible mismanagement of funds had already become clear.

President Dmitry Medvedev visited the shipyard in July and ordered current CEO Nikolai Kalistratov to complete the project, warning that there could be "grave consequences" for further delays. Problems at Sevmash have forced "everyone to make excuses, you to me and I to our Indian partners," Medvedev said at the time.

The source close to Rosoboronexport said three other defense deals may be discussed during the visit, although he declined to speculate on whether they would be signed. The talks could include the sale of 126 MiG-35 fighters, which are being tested as part of an Indian defense tender; development of the Russian-Indian fifth generation PAK FA fighter; and modernization of Su-30 MKI fighters.

Additionally, India is expected to complete a tender to buy patrol ships for its navy later this year, and Russia could participate in their construction, the source said. "It is most likely that an Indian company would win it, but they will build vessels in cooperation with Russia because they wouldn't be able to do it on their own ."

Putin is most likely to sign deals to finish the aircraft carrier, sell 29 MiG-29 fighters that would be based on the carrier for $1.2 billion and jointly develop the MTA transport aircraft, Vedomosti reported last week, citing sources close to Rosoboronexport's management.

Rosoboronexport spokesman Vyacheslav Davydenko confirmed that the three agreements would be discussed, but he declined to comment on the terms of possible agreements.

"We never link our contracts to official visits, so I can't say which of them may be signed during the visit and which may not," he said.

The government's press office was not immediately available for comment.

In a promising prelude to Putin's trip, the Indian Defense Ministry on Tuesday said it approved Rosoboronexport as a helicopter supplier.

"In 2008, we agreed to supply 80 MI-17-V-5 helicopters to India, and we will start delivering them by the year's end. Now the Indians want to buy another 60 helicopters of the same model," the source said, without commenting on the possible terms.

Experts said India was likely to stick with Russian-made arms, despite expressing concern about the quality of some aircraft and the problems with the aircraft carrier. In 2009 alone, India lost two Su-30 MKI, three MiG-27s and three MiG-21s in noncombat crashes.

"The Indian army is equipped with Soviet arms, and switching to Western analogues takes a long time," said Alexander Pikayev, a senior research fellow at the Institute of World Economy and International Relations. "Also, Russia was the only country so far that agreed to sell India an aircraft carrier, so it looks like India has no other choice. "

Moscow and New Delhi have been expanding economic ties beyond arms exports. During Singh's visit to Moscow in December, Russia was given the green light to build nuclear plants in India and work on satellite cooperation.

The countries may sign off on a joint venture in India to produce navigation equipment that would work with both the Russian Glonass system and its U.S. equivalent, GPS, Alexander Gurko, CEO of network operator Navigation and Information Systems, said Tuesday.

India would be able to use the system's civilian signal, which offers precision within 15 meters, while the use of the more precise military signal is being negotiated, Gurko said, RIA-Novosti reported.

Putin is also expected to sign an agreement on boosting cooperation in nuclear energy. India has 4.1 gigawatts of nuclear capacity now, a figure it is trying to raise fivefold by 2020.

India will build five nuclear plants in Gujarat, Andhra-Pradesh, Maharashtra, West Bengal and Orissa states, and Russia and France are welcome to participate, Srikumar Banergi, chairman of the Indian commission on nuclear energy, said Tuesday.

Russian firms are working on the first phase of the Kudankulam plant in Tamilnad state, which will become India's most powerful. Rosatom chief Sergei Kiriyenko said last year that nuclear work in India is "not just billions [of dollars]. It's about tens of billions."

Putin is also expected to sign an agreement that would make it easier for Indian businessmen to travel to Russia, Interfax reported Tuesday, citing a high-ranking source in India.

http://www.themoscowtimes.com/business/article/putin-to-push-arms-energy-in-india/401283.html

 

[ankur]

"The Indian army is equipped with Soviet arms, and switching to Western analogues takes a long time," said Alexander Pikayev, a senior research fellow at the Institute of World Economy and International Relations. "Also, Russia was the only country so far that agreed to sell India an aircraft carrier, so it looks like India has no other choice. "
Don't this statement convey the message that we are obeseed with getting arms from russia and despite so hiccupus in many areas we still buy and use soviet build arms.has the time not come to "seriously" move away from this dangerous trend of over-reliance on russia and divesify our import needs?

 

[Yusuf]

India is doing that. Otherwise we would not have got the P8, C130, Jalashwa. India is playing the game of getting the best technology. We are still dependent on russia when it comes to other things where it provides us ToT and licensed production something we can't get from the west namely US and the europeans are far too expensive.

India is doing all right as far as sourcing is concerned but the problem is in the delay in making the decision to buy.

 

[ankur]

what about the israel being developing into a biggest arm supplier just behind russia?

 

[Yusuf]

What about it? Like I said India is playing the game perfectly fine. It has diversified its options. Why do you thing Putin is coming to town? Russian share is going down and he wants to make sure he does something that holds the slide. Its kind of like the market share Maruti had till a few years ago. About 90% or something. Then the others came. Maruti is still up there with i think 60% share. Russia is like Maruti, Israel is like Hyudai. Everyone has a pie to eat of this great Indian market.

 

[A.V.]

Russia to build 12 nuclear plants in India

http://timesofindia.indiatimes.com/...clear-plants-in-India/articleshow/5677368.cms


NEW DELHI: Giving a fillip to their ties, India and Russia on Friday signed 19 pacts, including three in civil nuclear field and one for purchase of 29 MiG-29 fighters besides inking the revised agreement on Gorshkov aircraft carrier, a deal that was stuck for three years over price.

Under the agreements in civil nuclear field, Russia will build 12 atomic plants - six in Kudankulam and six in Haripur in West Bengal.

The agreements were signed during the day-long visit of Russian Prime Minister Vladimir Putin who held comprehensive talks with his counterpart PM Manmohan Singh with an aim of exploring opportunities for further boosting the relations.

They also discussed regional issues, including Afghanistan and Pakistan, in the context of terrorism and agreed to intensify their consultations on Afghanistan the challenges posed by terrorism and extremism in the region.

The pacts in civil nuclear field are agreement on cooperation in the use of atomic energy for peaceful purposes and agreement on road map for the serial construction of Russian designed nuclear power plants.

An MoU was also signed on Nuclear Power between NPCIL and Atomstroy Export for construction of third and fourth atomic plant in Kudankulum in Tamil Nadu.

The revised agreement on Gorshkov aircraft carrier deal was also signed during the visit. The deal had initially been signed in 2004 at the cost of $1.5 billion, along with 16 MiG-29Ks. However, the Russians later demanded $2.9 billion, citing escalation of costs.

After protracted negotiations, the two sides settled at $2.34 billion.

 

[ajtr]

Putin's India visit part of Russia's balancing act with Asia's rising powers

Russia and India currently have a cooperation program running until the end of this year which comprises of about 200 joint projects, including the $2.35-billion refitting of the INS Vikramaditya aircraft carrier - one of the deals expected to be completed this week.

But Putin will be looking to sign off on at least three new major weapons deals during his March 11-12 visit and extend Moscow's long history of defense relations with India.

In addition to the Vikramaditya refitting deal between Russia's state-controlled arms exporter Rosoboronexport and the Indian Defense Ministry, Putin is expected to sign a $1.2-billion contract for the delivery of a number of MiG-29K/KUB carrier-based fighters.


Putin made Russia India's main nuclear benefactor
Putin and Indian Prime Minister Manmohan Singh are also expected to discuss the progress of Russia's new T-90 tanks which are being built in India.

Other agreements concern the operational nuclear reactors at Kundankulam in Tamil Nadu, built by Russia, and Russian involvement in the development of the new reactor site at Haripur in West Bengal.

Russia pursuing even-handed policy with India, China

On the surface, two countries such as Russia and India signing arms deals and agreements should not raise too many eyebrows but experts believe that this increasing level of cooperation is an indication of the importance Moscow places on maintaining good relations with the main international players on the sub-continent and surrounding region.

Stanislav Secrieru, an expert at the Center for East European and Asian Studies in Bucharest, believes that Putin is not only looking to secure military contracts but Russian involvement and influence in the region, in the face of expanding Chinese and Indian power.


Russia makes sure that China gets its share of deals
"Russia holds residual influence in the region," Secrieru told Deutsche Welle.

"However, China's and India's rise will further diminish Russia's position in the region over time. Russia's relations with China already display some asymmetry with Beijing actively counter-balancing Russia in the post-Soviet world, while India does not feel like a junior partner anymore and has managed during the last few years to equilibrate its relationship with Russia."

"Hence, power dynamics in the region indicates that in the mid- to long term, Russian influence will decline with China most probably assuming a more prominent role."

Secrieru believes that Russia is not trying to trump China by cosying up to India but that Moscow is attempting to maintain a balanced relationship with Asia's two great emerging powers.

"Relations with China are more intensive because of the frontier and the Central Asian neighborhood Russia shares with it but Moscow has strived to maintain the equilibrium and ease any suspicions on the Indian side," he said. "The economic crisis and strong performance of China and India only reconfirmed for Moscow that it needs to foster a balanced relationship."

Shanghai bloc provides Russia with strategic opportunities

"Russia's relationship with India is one of pragmatism," Alexander Rahr, a Russia expert at the German Council for Foreign Affairs in Berlin, told Deutsche Welle. "It knows that it is too weak to be a strategic ally so the two countries have agreed to cooperate economically."


Russia's membership of the SCO strengthens its hand
Rahr believes that Russia still hopes to gain more strategic power in the region but realises that this can only be done through a new Asian alliance with India and China. The most likely way for this to happen is through the Shanghai Cooperation Organization (SCO), the intergovernmental mutual-security bloc which also includes a number of Central Asian states.

"The SCO has a bright future and it can offer Russia more than just an economic boost in the region," Rahr said. "Within its framework, Russia can work with the rising Asian powers and benefit from being a member of an organization which boasts the next potential economic and strategic superpowers in India and China."

India benefits from Russia's balancing act

Relations with India are also part of Russia's broader strategy to geographically diversify its economic external relations. Moscow thinks that its economic relations are unbalanced, with the EU accounting for almost 52 percent of Russian trade turnover. Moscow believes that this focus on Europe could constrain its freedom of action on the international stage so relations with India are important to the expansion of Russia's global agenda.


Russian military know-how helps India modernize its army
As India continues its steady rise to regional and international prominence, it becomes an attractive partner for countries like Russia who hope to maintain a level of involvement in the sub-continent's politics. In turn, India gets the benefits of Russia’s energy resources, its help in achieving military modernization and the opportunity to expand its technological, chemical and pharmaceutical industries into the Russian market.
"Russia needs open markets and India is one of these," Rahr said. "India has welcomed Russia unlike the EU which demands Moscow to develop more European attitudes and policies in return for the more relaxed trade agreements. So Russia now has the opportunity to sell arms and hi-tech equipment to India and in return, India gets Russia's expertise and technology to help with its civil nuclear program."

"India gets a lot from the relationship with Russia. They have traditional ties going back decades. India-Russia ties survived the Cold War because there were no ideological clashes between them, as there were with China, and India never had any fear of the Soviet Union. So the relationship has endured."