Tag Archives: Lockheed Martin

Defense Dysfunction

The MMRCA decision illustrates the deep problems besetting the Indian defense establishment.

Much of the commentary about India’s elimination of the Boeing and Lockheed Martin bids from its hotly-contested, highly-lucrative Medium Multirole Combat Aircraft (MMRCA) competition has focused on its meaning for US-India relations.  The air force is the largest beneficiary of the country’s burgeoning military budget and a number of foreign companies were looking to snap up the $11 billion MMRCA contract. The Americans were also expecting that the diplomatic capital they assiduously built up in New Delhi in recent years would turn the decision to their favor. Instead, New Delhi opted to reject the U.S. entrants and shortlist for final selection the Typhoon aircraft produced by the four-nation Eurofighter consortium (composed of British, German, Italian and Spanish defense companies) and the Rafale offered by France’s Dassault Aviation SA.

MMRCA_ImageMany interpret the decision as an emphatic rebuff of Washington’s overtures for closer security links. John Elliott, a long-time observer of the Indian scene, views the move as an effort at “keeping the U.S. firmly in its place.”  Others see it as a sign that lingering doubts still reside in New Delhi about the reliability of the United States as a defense supplier. Bruce Riedel, an informal Obama administration adviser on South Asia, argues that “there is a belief that in a crisis situation, particularly if it was an India-Pakistan crisis, the U.S. could pull the plug on parts, munitions, aircraft – precisely at the moment you need them most. Memories are deep in this part of the world.” Stephen P. Cohen, the dean of U.S. South Asianists, concurs: “India would have given the order to a U.S. firm if it had been assured that the United States would back India politically thereafter.  Since this guarantee was not available, and awarding a U.S. firm the contract would increase Washington’s ability to influence New Delhi, the United States was a not a good choice politically as a supplier.”

According to Ashley J. Tellis, one of the most insightful and well-informed observers of US-India affairs, both perspectives are wrong, however. In a superb review of the decision, he argues that it represents less an omen about bilateral ties than a sui generis episode involving the Indian air force’s rigid application of technical desiderata. The bottom line, Tellis says, is that New Delhi selected the European contestants for no other reason than they were adjudged the better flying machines.

Some Indian commentators are of the view that, with bilateral ties now so multi-dimensional and mature, Washington’s sense of letdown will dissipate quickly. This is likely to prove wishful thinking, given how aggressively the Obama administration lobbied on behalf of the American bids. But Tellis’s account at least reassures that the decision did not entail a repudiation of the US-India strategic partnership.

Less heartening, including to those in Washington who want to see New Delhi become a more capable global power, are the serious problems in the Indian defense establishment that are highlighted by the MMCRA selection process. Aiming to ward off charges of graft and extraneous influence that have plagued big-ticket military contracts in the past – Rajiv Gandhi’s government collapsed in 1989 due to the corruption scandal involving the Bofors heavy artillery pieces – Defense Minister A.K. Antony crafted a selection process that relied solely on narrow technical assessments that reportedly encompassed some 500 criteria. Relevant strategic, political and financial factors were purposively excluded from consideration. Following extensive field trials, the air force concluded that the two European finalists possessed superior aerodynamic capabilities relative to their American competitors.

Tellis agrees that, on the basis of narrow technical assessments, the Typhoon and Rafale represent the best choices and that the selection procedure was free of corruption. But if the process was clean, it was not in his view a rational or even well thought-out one. By making such a major procurement decision without examining other attendant considerations, the defense ministry, in Tellis’s view, runs the risk of misallocating precious resources, thereby undercutting India’s larger national security interests. Giving due weight to important non-technical factors, he contends, would have cast the American entrants, particularly Boeing’s F/A-18 E/F Super Hornet, in a more favorable light. As he sees it, the Super Hornet is a truly cost-effective choice once issues like unit piece, technology transfer, offsets, production lines schemes and possibilities for strategic collaboration are assessed.

This specific judgment might be contested within the Indian air power community, but the post-mortem Tellis provides about this particular acquisition decision has larger institutional implications. He reveals, for instance, that the financial details of the bids were not examined prior to the short-listing. If they had been, evaluators might well have asked whether the marginally superior performance offered by the Typhoon and Rafale are worth their markedly higher price tags ($125 million and $85 million, respectively) compared to the Super Hornet’s $60 million. And even if Indian officials decided they were still getting their money’s worth, it would have behooved them to include the U.S. plane on the shortlist in order to enhance their bargaining leverage vis-à-vis the European companies.

It is also striking that only after the shortlist was announced did the defense ministry turn to consider important questions about technology transfer, offset arrangements and production efficiency. India’s defense industrial sector remains conspicuously immature, certainly in contrast to other world powers. (As Stephen P. Cohen and Sunil Dasgupta maintain in their new book, the well-funded military R&D system is remarkably short of accomplishment.) Yet Tellis points out that the European aircraft selected have a more limited capacity to transform the country’s technology base than their American counterparts. This, too, would seem to be an important matter to assess, yet it was deliberately excluded from consideration.

Geopolitical considerations were similarly absent from the decision, especially the issue of whether New Delhi should leverage the opportunity to enhance military-technological ties with the United States. With President Obama’s personally intervening with Prime Minister Manmohan Singh, the lack of integrated decision-making all but guaranteed negative diplomatic fallout. As Tellis notes:

“In its zeal to treat this competition as just another routine procurement decision falling solely within its own competence, the acquisition wing of the ministry of defense communicated its final choice to the American vendors through the defense attache’s office at the U.S. Embassy in New Delhi without first informing the ministry of external affairs. This action put the latter in the embarrassing position of not knowing about the defense ministry’s decision a priori and, as a result, was unable to forewarn the United States.”


The upshot, according to Tellis, is that the thoughtless manner “in which these results were conveyed did not win New Delhi any friends in Washington, a process that Indian government officials now recognize and ruefully admit was counterproductive.”

New Delhi has now announced that a blue-ribbon commission is being formed to examine the deep problems besetting the defense establishment, including those in the areas of strategic planning, resource allocation and systems acquisition. A good point of departure would be considering the woeful institutional lessons offered by the MMRCA case.

Taking the Long View

Over time, the expansion of Chinese strength will undoubtedly push New Delhi to tighten its security relations with Washington, though the process will neither be as smooth nor as speedy as many would like.

Just as US-India ties were at a nadir following New Delhi’s nuclear tests in 1998 – and just as the United States and China were declaring their own strategic partnership – Prime Minister Atal Bihari Vajpayee famously characterized Washington and New Delhi as “natural allies” who would form “the mainstay of tomorrow’s stable, democratic world order.” Two years later, Vajpayee reaffirmed this description.

Judging by the dense bilateral links the two countries have crafted over the past decade, Vajpayee phrase seems to have been vindicated. Not only have a landmark civilian nuclear accord and a spate of defense contracts been concluded, but the two countries have established some 30 bilateral dialogues and working groups on a wide gamut of issues, and the United States holds more bilateral military exercises each year with India than with any other nation.

Yet U.S. elites are suddenly shying away from the term “ally.” Assistant Secretary of State for South & Central Asia Robert Blake, for instance, states that “India and the United States will never be allies in the traditional sense of the term.”  Strobe Talbott, who as Deputy Secretary of State in the Clinton administration began the first institutionalized dialogue between Washington and New Delhi, contends that the countries “are not now, and may never be, allies.” Stephen P. Cohen, dean of U.S. South Asianists, likewise maintains that “India is a friend, not an ally” and the new US-Indian strategic alliance is “still more symbolic than real.”

All three underscore the distinction between long-standing U.S. allies, such as the United Kingdom, Japan and South Korea, and partners like India that are not bound by formal security commitments. And Blake’s statement was undoubtedly in deference to Indian sensitivities about being sucked into America’s strategic orbit, although he adds that India can no longer be considered a non-aligned country given the “increased convergences in strategic outlook” between Washington and New Delhi. But Talbott and Cohen are less sanguine on this count. The former argues that:

One reason we may never be [allies] or not in the any foreseeable future, is because there is still a huge constituency in support of India’s non-aligned status, despite the fact that I would say that non-alignment and the non-aligned movement is very much an artifact of the Cold War. I remember having a conversation with Natwar Singh [retired Indian diplomat and Manmohan Singh’s first foreign minister] when Congress was out of power and him saying to me that the proudest moment of his career was being secretary general of the non-aligned movement. That sticks in my mind. I took that as a sign that there are still a lot of Indians who take non-alignment seriously.

Cohen strikes a similar note: “New Delhi has a deep commitment to strategic autonomy, as indicated by its insistent use of the moderating prefix ‘natural’ to describe its U.S. relationship. In the end, India got what it needed from Washington, including recognition of its nuclear weapons program and support for its permanent membership on the United Nations’ Security Council, at little or no cost.”

Believing that strategic ties remain, at best, “aspirational,” Michael Auslin, at the American Enterprise Institute, likewise notes that the

continued adherence to Jawaharlal Nehru’s non-aligned strategy clearly animates the worldview of most thinkers [in India], even if the language used to describe it no longer partakes of such Cold War imagery. There is a firm commitment in New Delhi not to have any firm commitments to any one state. It seems the Indians have taken to heart, far more than the Americans, George Washington’s warning against entangling foreign alliances.

All of these comments come at a time of widespread disappointment in Washington that the bilateral relationship has not lived up to the strategic and economic possibilities that seemed so alive just a few years ago. As my last post noted, some observers are even questioning whether the Bush-Singh nuclear deal has succeeded in its primary aim of invigorating US-India geopolitical cooperation in the face of a rapidly growing and more assertive China.

The Bush administration devoted singular energy to courting New Delhi as a key part of its strategy of strengthening security links with China’s neighbors. In a widely-read article, Condoleezza Rice, then serving as chief foreign adviser to the George W. Bush presidential campaign, observed that Washington “should pay closer attention to India’s role in the regional balance.” She pointedly noted that “India is an element in China’s calculation, and it should be in America’s, too.” In his first major foreign policy address as a candidate, Bush argued that “we should work with the Indian government, ensuring it is a force for stability and security in Asia.”

Once the nuclear deal was unveiled at a July 2005 summit between Bush and Prime Minister Singh, Rice justified it by calling India “a rising global power that we believe could be a pillar of stability in a rapidly changing Asia.” At the summit, a senior Indian diplomat was quoted as saying that “Bush has a vision that we in India often don’t have. With Europe in decline and China rising, the U.S. sees India as a future global power with the ability to maintain [the] power balance in the 21st century.” A Bush administration official closely involved in the making of policy toward New Delhi commented that “China is a central element in our effort to encourage India’s emergence as a world power. But we don’t need to talk about the containment of China. It will take care of itself as India rises.”

Singh-Wen_PhotoIn the years since, has the growth of Chinese strategic power nudged Washington and New Delhi into tighter security collaboration, as many in the Bush administration expected? Or is Michael Krepon, one of the nuclear deal’s prominent detractors, correct in arguing that “New Delhi continues to titrate improved strategic cooperation with the United States” and that it “continues to improve ties with Beijing.  It is folly to presume that Washington can leverage New Delhi’s dealings with Beijing.”

There’s no denying the American disillusionment caused by India’s rejection of Boeing and Lockheed Martin’s bids in its $11 billion fighter aircraft competition and by the prolonged inability of U.S. companies to capitalize on the nuclear deal due to an Indian liability law that does not conform to international norms. It is also true that India and China have aligned to thwart U.S. objectives in global negotiations on trade and climate change, and that they often take the same side in UN deliberations.

But stepping back a bit in order to take in the wider perspective, it is clear that some fundamental geopolitical forces are at work in spurring India-China strategic frictions.  Instead of being the fraternal titans that drive the Asian Century forward, as envisioned in the “Chindia” chimera, it is more likely that their relationship in the coming years will be marked by increased suspicion and rivalry. The relationship has never really recovered from the trauma of their 1962 border war, and the strains have only increased over the past five years or so. Beijing is now taking a much more hawkish line on territorial disputes in the Himalayans, including asserting a brand new claim that the Indian state of Arunachal Pradesh is actually “Southern Tibet.”  It is also expanding its presence in territory controlled by Pakistan, and trying to block New Delhi’s efforts to play a greater role in regional and international institutions.

Much is made of the fact that China is now India’s largest trading partner and that two-way trade soared from $12 billion in 2004 to $60 billion in 2010, and that the countries are on track to reach $100 billion in 2015. When Premier Wen Jaibao visited New Delhi last December, he brought along a larger business delegation than President Obama did a month earlier, and the $16 billion in resulting trade deals eclipsed the $10 billion-mark struck by the Americans. Yet compared to US-India economic links, there are far more competitive elements, and far fewer complementary features, operating in India’s business interactions with China.

All of these developments have not gone unnoticed by the Singh government.  Famous for his cautious, taciturn nature, Singh has caused a stir with his public expressions of disapproval regarding what he terms Chinese “assertiveness.” In a September 2010 interview he complained that Beijing sought to “keep India in a low-level equilibrium” and that “it would like to have a foothold in South Asia.” Three months later, he shocked his Chinese guests during the Wen visit by refusing to reiterate India’s traditional endorsement of the “One China” policy or customary recognition of Tibet being an inviolable part of the People’s Republic.

Indian military planning is also increasingly focused on the threat from its northern neighbor, from taking major steps to fortify its northeastern border to accelerating the development of the Agni-V ballistic missile. With a reach of over 5,000 kilometers, and capable of carrying multiple warheads, the missile puts China fully within range of a retaliatory nuclear strike.

The strategic entente with India is Washington’s first geopolitical partnership to be forged in the post-Cold War era, meaning that its rhythm is bound to be quite different from the security alliances the United States rapidly created in the aftermath of World War II. Back then, the national power of Washington’s new-found allies was in stark decline, while India’s current power trajectory is visibly upward. The structural dynamics of a bipolar global order also were simpler than today’s messy multipolarity.  Over time, however, the expansion of Chinese strength will undoubtedly push New Delhi to tighten its security relations with Washington, though the process will neither be as smooth nor as speedy as many would like.

Fighter Shoot-Down

India’s elimination of Boeing’s and Lockheed Martin’s bids in its $11 billion fighter aircraft competition – one of the country’s largest-ever defense deals – is bound to have negative repercussions for the U.S.-India relationship. Analysts had expected at least one of these bids to advance to the final selection round; that neither did is being perceived as a deliberate snub of Washington. John Elliott, a long-time observer in New Delhi, interprets the move as an effort aimed at “keeping the U.S. firmly in its place.”

http://www.usinpac.com//images/stories/F-16IN_AT_AeroIndia2011.jpgThe Indian decision will add to Washington’s growing list of bilateral frustrations and is yet another sign that ties between the two nations continue to fall far short of the promise that glistened just three short years ago when the landmark nuclear cooperation accord was concluded.  That news of India’s action coincided with the (unrelated) announcement of Timothy J. Roemer’s resignation as U.S. ambassador in New Delhi only heightened the sense of disillusionment and fatigue.

The decision makes some sense on the basis of technical merits. The F-16 aircraft proffered by Lockheed Martin is a widely-used workhorse but also a 30 year-old platform; that Pakistan is one of the 26 air forces flying the plane also could not have endeared the Indian defense ministry. Boeing’s F/A-18 is a much newer system but it reportedly did not perform well in flight tests over the Himalayan ridges in Ladakh.  Eurofighter’s Typhoon aircraft – which New Delhi has shortlisted for possible selection – has much to recommend it technically. Additionally, the four-nation Eurofighter consortium (composed of British, German, Italian and Spanish defense companies) – along with France’s Dassault Aviation SA (whose Rafale fighter also was advanced to the final round) – also was more generous than the U.S. companies in terms of technology transfer.

American companies (including Boeing and Lockheed Martin) have snapped up a number of recent contracts from the Indian military, and one can expect New Delhi to award additional deals in the coming months as palliatives for U.S. disappointment at losing out of this highly lucrative transaction.

Some Indian commentators are of the view that, with bilateral ties now so multi-dimensional and mature, Washington’s sense of letdown will be fleeting. But this is likely to prove wishful thinking.  The Indian decision will certainly not derail bilateral affairs. But given the Obama administration’s aggressive lobbying on behalf of the American bids, it will only deepen the perception in Washington that New Delhi has not lived up to its side of the bargain by reciprocating the huge commitment the United States has made over the past decade to bolster India’s great power prospects.

As Siddharth Vadarajan, the strategic affairs editor of The Hindu, notes, Washington came at the fighter deal with “all guns blazing.” The U.S. campaign included President Obama, who made a personal intervention with Prime Minister Manmohan Singh during his state visit to India last November and then followed up in February with a letter underscoring “the strategic importance the United States attaches to the selection of a U.S. proposal in India’s Medium Multi Role Combat Aircraft competition.”  Ambassador Roemer was tireless in pressing the same message.  And to sweeten the pot, the United States granted India the opportunity to participate in Lockheed Martin’s program to develop the advanced technology F-35 fighter aircraft – an offer that New Delhi effectively rebuffed last December when it opted for a joint arrangement with Russia to develop a separate fifth-generation fighter aircraft.

As an earlier post argued, Washington is becoming increasingly weary of New Delhi’s capacity for strategic engagement. The political soap opera accompanying the Indian parliament’s debate about the nuclear cooperation agreement in the summer of 2008 was disheartening from the U.S. perspective and could hardly inspire confidence that India was ready to move ahead with full-throttle cooperation. Adding to the list of sorrows is that the nuclear liability law adopted by India last year has the effect of all but blocking the involvement of U.S. companies in India’s nuclear energy sector – one of the things that the nuclear deal was supposed to bring about. (And following Japan’s nuclear disaster, U.S. hopes that New Delhi would revisit the law anytime soon are stillborn.) And despite numerous suggestions for bi-national endeavors at producing clean energy technology, Washington is miffed that Indian restrictions on imports of solar-power technology are thwarting the entry of U.S. firms into one of the world’s fastest-growing solar-energy markets.

Boeing's F/A-18 at the Aero India 2011 air showTroubling as well are reports that a major factor in India’s elimination of the Boeing and Lockheed Martin bids was the military’s continued wariness of the United States as a full-fledged strategic partner. In contrast to institutional memories of past U.S. technology embargoes that still linger throughout the security establishment, the military supply relationship New Delhi has forged with Paris – Dassault’s Mirage 2000 fighter has long been in service with the Indian air force – seemed to play an important role in the decision to shortlist the Rafale. The Obama administration had worked hard to ease these memories, including advancing the F-35 offer and the further easing of U.S. export controls on India that were announced in February.  Mr. Obama’s letter to Prime Minister Singh also made promises on this score.

While India’s decision will certainly not produce a bilateral rupture, its consequences may be more pronounced than the rosy scenario sketched by the optimists. At a moment when the Obama administration has begun to turn its attention back to New Delhi, it will reinforce nagging doubts in Washington about India’s willingness to make the big decisions necessary to dramatically advance the relationship.  Such doubts could even break into the open given the bilateral frictions likely to ensue as the United States approached the endgame in the Afghan conflict. There may be solid technical reasons behind the fighter decision. But the soundness of its strategic logic is about to be put to the test.

How to lose friends and alienate people

India’s decision to reject U.S. fighter planes is strategic stupidity.

New Delhi, it is reported, has shortlisted two European vendors for its long-drawn procurement of fighter aircraft for the Indian Air Force. Now, military analysts can have endless debates and even objective opinions on which among the American, European and Russian aircraft is technically superior and better suits the stated requirements of the IAF. Financial analysts can have similar debates and objective opinions on which is the cheapest or the best value for money. These opinions may or may not converge. But when you are buying 126 planes worth more than $11 billion dollars, you are essentially making a geostrategic decision, not a narrow technical/financial one.

The UPA government’s decision to reject both American proposals, of the F-16 and F/A-18, demonstrates either a poor appreciation of the geostrategic aspect or worse, indicative of a lingering anti-American mindset. While the U.S. ambassador has resigned, whether or not it will prove to be a setback for India-US relations remains to be seen. Damaging the careers of pro-India American officials is a silly thing to do.

This move will most certainly reduce India’s geopolitical leverage with the U.S. military-industrial complex, at a time when India needs it most. From the unfolding dynamics in the Afghanistan-Pakistan region, to the changing balance of power in East Asia, to UN Security Council reform, to a number of geoeconomic issues, the United States can take positions that can have long-lasting consequences for India’s interests. Is the United States more likely to be sympathetic to India’s interests after a $11 billion contract—which means much needed jobs for the U.S. economy —is awarded to someone else? Long used to complaining that the United States doesn’t care for India’s interests, will awarding the contract to some European firms help change the situation?

The argument that the European bids were ‘technically’ superior are not entirely credible either, for two reasons. First, at sufficiently high levels of technology, the difference between the planes on offer is marginal. To suggest that the European models are vastly superior defies logic, because some of the world’s most powerful air forces are flying F-16s, leave along F/A-18s. Second, the notion that combat requirements can be perfectly defined at the time of procurement is false. It is the combination of man and machine that wins battles. The focus on machines ignores the reality that much swings on the man flying it. Moreover, given the nuclear deterrence relationships obtaining in the subcontinent and across the Himalayas, those planes might never see an aircraft-to-aircraft dogfight in their lifetimes. For other tasks like air support for ground operations, the specifications are even lower.

What about those alphabet soup agreements and fine-print contracts that the U.S. insists that India sign, that might prevent the planes from being used when needed? Those who make these arguments do not understand what war means. War means all bets are off, and India will do whatever necessary to protect its interests. While the existence of those agreements was a usual bargaining chip for India, to get a discount, to believe that such arguments will hamstring India’s military options is naivete. The government might not need to spell this out in public, but it should know it.

It has been this blog’s argument that in the contemporary geopolitical environment, India’s interests are best served by being a swing power, holding the balance between the United States and China. It must enjoy better relations with each of them than they have with each other. It must also have the credible capacity to give pleasure and inflict pain. In this context, buying fighter planes from the United States would have been an excellent move.

And who has New Delhi shortlisted instead? European companies. The European Union is a bit player in the international system, zealously safeguarding its own legacy position at the United Nations Security Council, the G-20, the World Bank, IMF and other places, against India. Italy is engaged in process of blocking India’s UNSC candidature. An order placed with Eurofighter or Rafael isn’t going to change its plans. EU busybodies can be found everywhere from inviting Kashmiri separatists to speak, to attending court hearings of Binayak Sen. Some small EU states almost wrecked the India-specific waiver that the United States was obtaining at the Nuclear Supplier’s Group. When it’s crunch time in Afghanistan, does anyone in New Delhi think that the EU will or can make any move that’ll safeguard India’s interests? Why is India being gratuitously generous to Europe when there is much to gain from giving the contract to the United States?

Yes, France, Britain and Germany are countries that India must engage. There are ways to allow them to benefit from India’s growth process—from power projects to manufacturing to services. The fighter aircraft contract need not be awarded to European firms, because it has higher strategic opportunity costs.

The downshot is that the UPA government has squandered a unique opportunity to gain leverage in Washington at a crucial time when closer ties are in India’s interests. It first took way too long to decide, dragging the procurement process even China built its own new fighter plane. It now decided to pick two vendors who might well sell a technically superior and cheaper product, but do no more than that. To put it mildly, this is strategic stupidity.

(This post originially appeared on this author’s blog at acorn.nationalinterest.in)