India – USA Military Trade About to touch 190000 Crores may get nixed because of CAATSA
In 2016, the US had officially acknowledged India as a Major Defence Partner and in 2018 the relationship got elevated to the status of Strategic Trade Authorization tier 1. This meant that USA Government was now willing to sell to India, an entire range of military and dual-use technologies which are regulated by the US Department of Commerce.
The Defence Trade between the two Countries both through the Foreign Military Sales route and Direct Commercial Sale route has been expanding over the years. In almost 15 years the military trade between the two countries has now touched around Rs 150000 Crores. The military trade between India and the US is predicted to cross Rs 190000 crore over the next few years. This will hapoen provided USA behaves like a proper trader and refrains from attaching strings to its products or dictate terms to India …..like inspections etc. Sellers don’t have such rights.
With the new administration having taken over the reins in US, now both the Countries are engaged at various levels and the focus is to deepen the Comprehensive Global Strategic partnership. Shri Rajnath Singh, Raksha Mantri has already had a telephone conversation with the new American Defence Minister, Shri Lloyd J Austin. Both reiterated their commitment to deepening towards defence cooperation between India and the US.
According to the official spokesperson of Ministry of External Affairs (MEA), Anurag Srivastava, the introductory phone call between external affairs minister and his counterpart Shri Anthony J Blinken will also be scheduled soon, at a time convenient to both.
Both India and the US share vision of free and open Indo-Pacific. Both sides have inked several agreements including the Logistics Exchange Memorandum of Agreement (LEMOA), Communications, Compatibility and Security Agreement (COMCASA), and the Industrial Security Agreement (ISA) which was inked last year is now in place.
USA will soon start the delivery of the MH-60R Seahawk helicopters, purchased by India for around nearly Rs 21000 Crores through the FMS route. These helicopters will help the Indian Navy play a very critical role in defending the Indian Ocean Region from any misadventure by the Chinese Navy trying to increase its presence.
The IAF has already received 22x AH-64 Apaches from Boeing and now six more will be coming for the Army. The deal for the Indian Army was inked in 2020. According to Michael Koch, Vice-President, Boeing Defence, Space and Security, “Manufacturing of the six AH-64 Apache attack helicopters for the Army will be starting in India this year.” Though the helicopters for the Indian Army will be manufactured in India, they will go back to the US for outfitting with electronics and other systems.
Aero-structures, fuselages, secondary structures and vertical spar boxes for Boeing’s AH-64 Apache helicopter for the international customers is being produced by the Tata Boeing Aerospace Limited facility.
Together with the 15x CH-47F (I) Chinook helicopters and 28x Attack helicopters, the above deal was for Rs 37500 crore. India needs to buy additional at least 21x Chinooks for the IAF and 14x Appache helicopters for the Army to manage a two front war without hiccups. This means another deal of say Rs 35000 Crores.
In a deal signed in 2009 the Navy had procured eight P-8Is for Rs 16500 crore deal. The aircraft werw inducted in the 312A Naval Air Squadron based at Arakkonam. In 2016, the Navy exercised the optional clause for four more P-8Is in a deal worth Rs 7500 Crores. The first of the four aircraft was delivered last October and balance three expected soon. Indian Navy has since 2019, has ordered six more P-8I and the discussions are going on with the US government. These will come with extensive upgrades and encrypted communication systems.
Amidst the ongoing standoff between India and China, the India Navy is exploiting the P-8Is at a higher rate than the US Navy.The Boeing Company is in the process of setting up a 60,000-sq. ft. facility which will handle the training support and data handling centre at INS Rajali, Arakkonam. And there will be a secondary centre at the Naval Institute of Aeronautical Technology (NIAT), Kochi.
Indian Navy should ideally be provided another 30x P8Is to drive the fear of God into the PLAN submarines venturing into the Indian Ocean. That means a deal worth over Rs 65000 Crores.
The USA has made a offer of an Unmanned Aerial System – the Sea Guardian UAS manufactured by General Atomics. As has been reported, India is expected to buy 10 each of these for all the three services ie total of 30. The drones for each of the services will be getting different configurations because the payloads will vary for each. India is the first non-treaty partner to be offered a Missile Technology Control Regime Category-1 drone.
For the Indian Navy, these drones will help in monitoring the Indian Ocean and also strengthen surveillance of its coastal boundaries and will work in sync with the P-8i which is already in service. Each drone is going to be fully armed with sensors and weapons, costing total of Rs 22500 Crores.
However USA should not try to palm of its outdated F16 even in the guise of F21. IAF has no need for this fighter and neither are we interested in the F35 or the F15 variants.
Yes, we will welcome at least another 9x C17 GlobeMasters from USAAF reserves if possible, if not 19 of them.
USA is also likely to benefit immensely, in case HAL starts exporting its Tejas MK1A and Tejas Mk2, as orders will be placed for hundreds of more engines.
However, in case USA administration does not Squash idiotic talks about CAATSA among its politicians and media, then these deals of over Rs 200000 Crores of Arms business will vanish in thin air for the American Companies. Some of the orders will go to others and rest of it will be produced in India albeit after some delay.
So ball is squarely in the American Court.
