Indian Defense Sector Spend by 2015

The Indian defense sector is one of the fastest growing markets globally, with an estimated US$13.9 billion of the annual budget allocated for the acquisition of military hardware and technology in 2010.

Defense expenditure, which refers to the part of the budget that is spent on the acquisition of all types of military hardware and technology, has grown at a CAGR of 12.14% from 2005-09. Defense expenditure is expected to record a CAGR of 6.59% during 2010-15, to reach an annual spend of US$42.6 billion by 2015. This is primarily due to ageing military hardware and technology, domestic insurgencies and hostility from neighboring countries.

Strong growth in the sector is attracting foreign original equipment manufacturers (OEMs) and leading players from the domestic private sector to enter the market. Moreover, terrorism is leading to sharp increases in the defense budget and a shorter sales cycle, which translates as an attractive market for defense manufacturers.

The areas that are specifically expected to emerge over the short to medium-term include unmanned combat aerial vehicles (UCAVs), advanced electronic warfare systems, combat systems, rocket and missile systems, fighter and trainer aircraft, stealth frigates, and submarines. In addition, spend on IT and communications is expected to increase significantly, with a strong focus on enterprise applications, systems integration, and real-time mobile communications.

Among the defence services the Army with a budget of approximately Rs. 74,582 Crores in 2010-11 has the largest share, followed by the Air Force (Rs. 40,462 Crores), Navy (Rs. 21,467 Crores), DRDO (Rs. 9,809 Crores), and Ordnance Factories (Rs. 1,015 Crores).

Credit: USIBC and Its News Agencies

Unfair Criticism: Defence Offsets

Some Knowledge Professionals / Think Tanks provide exaggerated views on the defence offsets deals being executed lately. They may not be in full picture, or may not have an access to 'right source(s)'. These comments need 'mature' interpretation, sometimes the observations may even be biased or motivated.

Market Forces play in offsets. Obligors' Power, Buyers' Power, Threat of New Entrants / Competitors, Rivalry amongst Obligors, Alliances,etc, play its role. 'What You Need/Want', and 'What You Get' may have very little co-relation as a result.

We need to weigh it up all. Everything should not be seen with a 'black eye' sensing only kickbacks and corruption.

Sukhwindar

'Fairy Queen' of the Indian Railways

This is the oldest working steam locomotive in the country, 1855 vintage. On 15 Aug 1854, it steamed from Howrah to Hooghly to a distance of 24 miles. It also hauled troops to Raniganj in the 1857 war of independence.

Now is an exhibit at the Indian Railways Museum in New Delhi since 1971.

Kind Courtesy: Lt General( Retired) JFR Jacob

Defence Offsets: Indian Parliament Informed

The Indian defence industry will benefit from an inflow of $30 billion as offsets through military procurements from abroad over the next decade, according to a report submitted to parliament on Wednesday, 03 Aug 2011.

In a deposition before the Parliamentary Standing Committee, the MOD said that the projection, amounting to INR 1.5 lakh crore, was made in view of the $100 billion that India is expected to spend on defence procurements in the next 10 years. The deposition was part of a report on budgetary demands for grants for 2011-12, submitted by the committee to the Lok Sabha.

Offsets is a clause in the defence ministry’s procurement policy under which any equipment import worth more than Rs.300 crore will involve ploughing back of 30 percent of the contract amount back in Indian defence, homeland security and aviation industry. The policy is in existence since 2005, and has been refined over the years now.

‘As far as offsets are concerned, it is true that our procurements in the next five to 10 years would be more that $100 billion and 30 percent of that is $30 billion, which is INR 1.5lakh crore,’ a defence ministry official told the committee.

The official also went on to explain that the offsets clause involved either in a direct purchase by foreign arms companies from Indian industry, or technology transfers, or joint ventures with domestic firms in the defence, homeland security and aviation sectors.

The official, in its report, gave the example of the recent Indo-US deal for supply of 10 Boeing C-17s to Indian Air Force (IAF), under which India’s premier military research agency Defence Research Development Organisation (DRDO) will get high altitude engine test facility and a wind tunnel facility, both firsts in the country.

The Indo-Asian News Service (IANS)

'German-Italian Dual'

Five Germans in an Audi Quattro arrive at the Italian border.

The Italian Customs Officer stops them and tells them "It'sa illegala to putta 5 people in a Quattro."

"Vot do you mean it's illegal?" asks the German driver.

"Quattro meansa four", replies the Italian official.

"Quattro is just ze name of zefokken automobile" the German says unbelievingly. "Look at ze dam papers: ze car is designed to karry 5 persons" .

"You canta pulla thata one on me!" replies the Italian customs officer. "Quattro meansa four. You have five-a people in a your car and you are thereforea breaking the law."

The German driver replies angrily, "You idiot! Call your zupervisor over. I vant to speak to someone viz more intelligence!"

"Sorry" responds the Italian officer, "He can'ta come. He'sa busy witha 2 guys in a Fiat Uno".

Courtesy: Mohinder Singh Saund (IITK), Sweden.

US Needs Second Revolution Now?

Received this YouTube Video thru our Network. Talks what the US needs to do at this stage -- Needs a Second Revolution. Good and educative for viewing! This may be the best six minutes invested by You.

http://www.youtube.com/watch?v=jeYscnFpEyA

May be, it is relevant for India too.

Defence Reforms, Civil-Military Relations and Military Effectiveness in India

A roundtable discussion was held on 30 May 2011 to discuss the two papers on the subject written by Anit Mukherjee, Research Fellow IDSA;

a. Failing to Deliver: Post Crises Defence Reforms in India, 1998-2010,
b. The Absent Dialogue: Civil-Military Relations and Military Effectiveness in India.

List of participants
General VP Malik (Retd), former Chief of Army Staff
Ajai Vikram Singh, former Defence Secretary
NS Sisodia, DG, IDSA
Air Marshal M Matheswaran, Air Headquarters
Air Marshal PK Mehra (Retd), Distinguished Fellow, CAPS
Vice Adm Pradeep Kaushiva (Retd), NMF
Maj Gen PS Sandhu (Retd), USI
Dr. Arvind Gupta, LBSC Chair, IDSA
Sqn Ldr PS Chhina (Retd), CAFHR, USI
Serving officers from the three service headquarters
Other members of IDSA.

His Excellency Shri NN Vohra, Governor of Jammu and Kashmir Presided.

The following important points in relation to Civil-Military Relations (CMR) got highlighted in the roundtable:

1. It was important to capture the weaknesses that accrue from the current problematic form of civil-military relations, observed one participant in the roundtable.

2. It was generally felt that debate on the CMR needs to move forward from the ‘bureaucracy versus the military’ towards one that encourages a respectful and well-informed dialogue between all the stakeholders in the system. Military education should instruct its officers to learn how the Government of India officials have to follow the rules of business. Moreover, the challenges and characteristics of Indian democracy and public-policy making and implementation should also be highlighted. In turn, there is a need to educate the civilian policy makers of the challenges and sacrifices made by the Indian military.

Our Comments:

1. It is a landmark decision of the IDSA to focus on the CMR and bring the issue in the public domain. Informed Citizens and Indian Think Tanks have an opportunity now to discuss the issue openly and dispassionately. Probably, lack of information & communication on the CMR; responsibilities and limitations of civil-military functioning within their charters; hardly any open debate(s) on the issue in setting of the Indian Democratic System involving all the stakeholders; our inability to see the CMR as an all inclusive issue, etc, are the issues that need to be addressed – the CMR are not limited to civil-military bureaucratic relations only as perceived by some.

2. We need regular monitoring of conduct of important ‘actors’ down up to District and Unit Levels who tend to derail the CMR . We can ill-afford to let the CMR be neglected any more; today's soldier is a vibrant part of the CMR in India.

Read the Proceedings: The Roundtable

Chairperson, SvipjaCMRChair.

We Are Blessed

INTERESTING COINCIDENCE !

India is blessed by.....

Amma in South;
Didi in East;
Bhenji in North;
Aunty in the Capital;
Madam in Center;
Nani on top (the President)
& "Wife At Home"

And yet people say.. It’s a Man's World ?

Courtesy: Shashi Varma

Emerging Strategic Defence Culture in India, and Interplay of Civil - Military Relations

"Failing to Deliver Post-Crises Defence Reforms in India, 1998-2010", a Research Paper of Anit Mukherjee of the IDSA, laments lack of 'strategic culture' and inapt 'civil-military Ralations' as the main causes for the Reforms failing in a way.

This paper analyses civil-military relations in India from 1998 to 2010. It examines the reforms undertaken within national security agencies and their eventual outcome. In doing so it explores two major questions—what precipitated the reforms in India’s national security agencies after the 1999 Kargil war? And, what was the impact of these reforms and did they achieve their stated objectives?

It analyzes the Kargil Review Committee Report and its follow up, the Arun Singh Committee and describes some of the debates therein. While examining the implementation of defence reforms it then argues that despite some incremental progress they have failed the vision of their architects. This is primarily due to bureaucratic politics and the unique features of civil-military relations, which can be more accurately described as an “absent dialogue.” The penultimate section describes recent calls for re-visiting the defence reforms process but argues that without political will this is unlikely.

“bureaucratic inertia, political ineptitude and the state of civil-military relations…may have more to do with the absence of strategic thinking”. Indeed, as this paper argues it is broadly these three factors that have obstructed defence reforms.

We, as a nation, let our inadequacies perpetuate incrementally for personal gains. This is the history of our sub-continent and its people unfortunately -- SvipjaCMRChair.

Read the Paper : http://www.idsa.in/system/files/OP_defencereform.pdf

SvipjaCMRChair

'Humour in Uniform'

Courtesy: Dheeraj Singh, Navjot Singh

Offset Process for MSMEs

India’s aerospace and defence sector is throwing up huge entrepreneurial opportunities worth several hundred million dollars in the form of offsets.

An offset agreement is a stipulation made between a foreign supplier(Obligor) and a local company, which requires the supplier (Obligor) to fulfill certain offset commitments in that country as part of a Prime contract. For the Air India deal, Boeing’s offset commitment is to invest $1.7 billion and for P-8I maritime recce aircraft deal, it is $630 million, President Boeing said.

Boeing has already partnered with large-sized companies like TCS , Wipro , Infosys, HCL, Infotech, Tatas, etc. The Tier-I companies in the US/EU also need to partner with several hundred small companies in India for offsets. As of now, mid-tier companies in India such as Maini, Dynamatic and QuEST support the A & D supply chain of US/EU. Opportunities exit for similar other companies to supply to US/EU A & D Companies.

A & D Sector needs skilled labour, capital, technology transfer, equipment and military or civil certification in US/EU to be part of the chain.

“Entrepreneurs need to have a very good business plan supported by experts in the field. They also might need to partner with Tier-I companies. So, find partners, have a good plan, validated by experts in the field. In this business, there is no reward, if you can’t take risks”, the President said.

TTTHG-Svipja helps You develop business plan in concert with experts in the field from US/EU for You to be capable of becoming part of the supply chain of US/EU A & D Majors. Please read our Industrial Sector Partnership (ISP) Process on our Blog, www.IndianDefenceIndustry.blogspot.com

Read the Interview of President, Boeing India: International Co-operation and Offsets


Svipja Technologies

Tempering Through Struggles

Courtesy: Mr RP Bagai, ex-Chief Secretary,Chhatisgarh.

Forging India's Hard Power in the New Century

IDSA Issue Brief Forging India's Hard Power in the New Century is most relevant at this juncture. Such a research work could be of immense value to strategists. Could help shape our policies pragmatically based on scientific study.

The Researcher mentions various constituents of the Hard Power, one of it is ‘Civil-Military Relations’. It is a welcome thought. He postulates:

"Civil-Military Relations are at the core of any national security framework and the decision making process. While explicit political control over the military cannot be questioned, the need to involve the Indian armed forces as equal and responsible partners in the decision-making process is important.

Cross-pollination of national security bodies with defence expertise could contribute to better understanding on matters military and, consequently, the strategic thinking within the country.

In the short-to-medium term, it will entail the functional integration of the MoD and service headquarters, the creation of a chief of defence staff (CDS), representation of military staff in national security structures such as the NSC, leveraging military diplomacy in pursuit of India’s foreign policy objectives, consistency in military resourcing and expenditure, procedural reforms in the acquisition process and defence industry, and ensuring adequate operational preparedness levels to meet a range of military challenges and non-traditional threats."

SvipjaCMRChair

An Interesting Gravestone in Mexico

Courtesy: Harpal Grewal

Ethos of Military Leadership

The COAS is accountable for the functioning of the entire Army. It is a tradition that is ingrained in his psyche. All commissioned army officers study at the Indian Military Academy (IMA), Dehradun, where, engraved at the entrance to Chetwode Hall - named after the then Commander-in-Chief, Field Marshal PW Chetwode, who inaugurated the IMA on December 10, 1932, are the words,

"The safety, honour and welfare of your country come first, always and every time. The honour, welfare and comfort of the men you command come second, always and every time. Your own ease, comfort and safety come last, always and every time."

These words, from the speech Chetwode delivered while inaugurating the IMA 78 years ago, have inspired generations of officer-cadets who have passed out of the IMA.

Is it possible for our civil leadership to walk through the Portals of the Chetwode Hall at the IMA, somehow, to imbibe the military ethos which may greatly help to preserve, protect and defend the Indian Constitution in line of their duties?

Chairperson, SvipjaCMRChair
This Posting is inspired by The Economic Times, 03 Jan 2011 .

'The Last Post'

We have all heard the Armed Forces Buglers rendering 'The Last Post'. It's the song that gives us the lump in our throats and usually tears in our eyes. Here is the story behind it.

Reportedly, it all began in 1862 during the American Civil War, when Union Army Captain Robert Ellicombe was with his men near Harrison's Landing in Virginia. The Confederate Army was on the other side of the narrow strip of land.

During the night, Captain Ellicombe heard the moans of a soldier who lay severely wounded on the field. Not knowing if it was a Union or Confederate soldier, the Captain decided to risk his life and bring the stricken man back for medical attention. Crawling on his stomach through the gunfire, the Captain reached the stricken soldier and began pulling him toward his encampment.

When the Captain finally reached his own lines, he discovered it was actually a Confederate soldier, but the soldier was dead.

The Captain lit a lantern and suddenly caught his breath and went numb with shock. In the dim light, he saw the face of the soldier. It was his own son. The boy had been studying music in the South when the war broke out. Without telling his father, the boy enlisted in the Confederate Army.

The following morning, heartbroken, the father asked permission of his superiors to give his son a full military burial, despite his enemy status.

The Captain had asked if he could have a group of Army band members play a funeral dirge for his son at the funeral. The request was turned down since the soldier was a Confederate. But, out of respect for the father, they gave him only one musician. The Captain chose a bugler. He asked the bugler to play a series of musical notes he had found on a piece of paper in the pocket of the dead youth's uniform.

The haunting melody, we now know as 'The Last Post' used at military funerals was born.

The words are:-

Day is done.
Gone the sun.
From the lakes
From the hills.
From the sky.
All is well.
Safely rest.
God is nigh.
-------
Fading light.
Dims the sight.
And a star.
Gems the sky.
Gleaming bright.
From afar.
Drawing nigh.
Falls the night.
-------
Thanks and praise.
For our days.
Neath the sun
Neath the stars.
Neath the sky .
As we go.
This we know.
God is nigh.

Courtesy: Mr GS Sahni, ex-Secretary, IAS.

PS: Remember those lost and harmed while serving their country. Also remember those who have served and returned; and those presently serving in the Armed Forces.