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Weak leadership

Indian MoD’s careless attitude is affecting preparedness

The Indian defence establishment is suffering from not one but several malaise, which is seriously hampering the modernization of the armed forces. No government in the world can tolerate corrupt means to influence an acquisition decision but the way Indian MoD asks the potential suppliers to adhere to the integrity pact before concluding a deal agreement has made a mockery of Indian defence establishment world over.

This has not only led to vital equipments supplies to armed forces being stopped or delayed but also affected the policy making one way or the other. The way the MoD has handled the Agusta VVIP helicopter deal has exposed the loopholes of the Defence Acquisition process and the ministry has never made any sincere attempt to close the gaps and improve transparency in the acquisition process.

Policy paralysis

Many factors have led to the policy paralysis in the entire defence establishment, resulting in handicapping of the armed forces.  God save the territorial integrity of a country which takes more than two decades to finalize a weapon system for its armed forces.

If the MoD takes over seven years to finalize the MMRCA deal, thinks hundred times to take a final decision on the shoulder fired anti tank missiles, cannot find even two decades time sufficient to chose a Howitzer Gun system for the Army and leaves its Aircraft Carrier defenseless in the absence of a deal to acquire anti- missiles, there is something very serious inside the monkey infested South Block.

The roaming “monkeys” inside the corridors of South Block seem to have created a fear psychosis among the  honest bureaucrats also who sit on the files to save themselves from uncomfortable questions and the smart bureaucrats work surreptitiously in collusion with the arms company  middlemen and the politicians who use their levers of money and powers to push the deal, only to be exposed  at a very advanced stage of the implementation of the contract-as we have seen in the case of the VVIP helicopter deal.

Due to delayed or cancelled contracts  the armed forces are devoid of many vital equipments and if the country were to face an emergency war like situation, the armed forces would be  able to respond in an extremely limping manner, because the weapon and ammunition stores of the three armed forces have many gaping holes.

For example the government may have facilitated the acquisition of the latest aircraft carrier INS Vikramaditya after a delay of five long years and the strategic analysts may describe this as the most potent weapon platform capable of meeting any maritime challenge, but sadly the Carrier may prove to be a sitting duck as it will not be able to deploy any anti missile systems to protect the Carrier from enemy air or missile attack.

This is principally due to the fact that the company supplying these missiles, called Barak, has allegedly been found to have indulged in corrupt practices. The Ministry of Defence has refused further dealings in this regard with the company and as a result the Indian Navy is forced to face likely disastrous consequences.  

The defence officials engaged in negotiations for the acquisition of weapon systems do not have a free hand to bargain in the national interest. The tendency to indulge in corrupt means to favor a particular arms company in spite of a so called fool-proof defence purchase policy has not been contained.

Many of the scams have happened under the tutelage of the honest proclaimed defence minister, who sometimes takes swift action to ban a particular company and some times ignores media and other credible reports of kickbacks in some of the major defence deals.

For example, when the reports of transaction of heavy kickbacks in the VVIP helicopter deal surfaced, the defence minister initially tried to shrug off the allegations by saying that there was not enough evidence of wrongdoings in the deal.

Only when the Italian government displayed guts to arrest the top executives of the Finmeccanica the MoD moved an inch and asked the CBI to launch investigations, which has not yet reached any decisive conclusions and only a few small fishes have been targeted, with no substantive action to take the investigation to its logical conclusions. This deal involved a kickback of Rs 360 crores out of the total transaction of Rs 3600 crores for the supply of 12 VVIP helicopters and the big beneficiaries of the deal are yet to be nabbed.

Impractical method

However, the very impractical method of dealing with scams in the defence acquisitions has led to major handicaps in the Indian armed forces without major defence systems. We all know that the Bofors scandal has forced Indian Army to survive without Guns for two and half decades after being badly bruised during the Kargil conflict in 1999. The army badly felt the absence of 155 mm guns and its ammunitions and there is no immediate possibility of the army getting the Howitzer guns in near future.

Till now because of allegations of corruptions the MoD has banned the companies from Singapore, Italy, Germany, and South Africa. If major companies are debarred from supplying weapon systems to Indian armed forces, how will Indian armed forces get the best of the systems and provide competitions to offer the best of equipments.

Though the MoD has adopted a policy of acquiring a weapon system only through competitive process, it has itself changed the course by adopting a different policy for the US companies who have charted a very clever route to sell their expensive weapon systems to India through government to government negotiations under the Foreign Military Sales policy of the Department of State of the US administration.

The US administration has been able to promote its defence companies through this smart move. This has caused heartburn among the rival weapon suppliers mainly the Russians who complain that when it comes to acquiring sensitive defence technologies like the Nuclear Submarines the Indian government approaches the Russian government, but ignores the genuine claims of the Russian companies, as told claimed by the Russian ambassador to India Alexander Kadakin recently.

Critics also point out the lacunae in acquiring the US made defence systems through FMS. The cost of the weapon systems is fixed and non negotiable. At whatever rate the American armed forces acquire the weapons systems from its domestic companies the same rate is applied to Indian armed forces.

Besides surcharge or service charge up to 8 percent is also levied, which the GoI pays without any hitch.  During the last decade the US Companies have been able to sell weapons like the Gun locating radars worth US$ 144 million, INS Jalashwsa (USS Trenton) worth US$ 44 million, Sea King Helicopters worth US$ 39 million, C-130 Hercules worth US$ one billion, P-8I worth US$ 2.2, C-17 worth US$ 5.8 billion.

Some of the officials in the MoD claim that since deals with US companies involve the US administration, who in fact may be labeled as middlemen, the MoD has also to pay service charges up to eight percent, which in fact equals the commission paid to the  middlemen in other deals. Thus in effect, the MoD has to reimburse the extra amount as service charge, which otherwise the country would not need to pay if the deal was negotiated through competitive bidding.

Till date no scam has surfaced in defence deals with US companies, the MoD finds it easier to acquire systems from US but this is accompanied by other conditions like the CISMOA and BECA which will impinge on the operational use of these systems during emergency.

The MoD must evolve a system to deal with corruption allegations without banning the entire company as it limits the weapon choice to a few remaining firms.