Why we are not able to call a spade, a spade? Fear of being stamped non-patriotic? It is a hard truth that some our PSUs have not been nurtured to become world class manufacturers because of the inherent work culture inherited in the Nehruvian era. MMS under PVNR started the cleanup operation under lot of resistance in all their earnest and sent a shivering message of ‘perform or perish’ to the non-performers but the campaign lost steam due to the coalition ‘compulsions’.
Now let us come to the brass stacks on Rafale and HAL:
The HAL has been shunned by Sukhoi design bureau and the Mikoyan group and Dassault is the latest one to decline sharing tech with them. HAL’s lack of expertise raised the cost of the Rafale even further while also not guaranteeing Dassault of the equipment quality. They proposed to bill 3 times the number of hours required to build 108 Rafales in India and raised the deal price for just the jets alone from 12 billion euros to 17 billion euros. i.e. nearly 140.74 million euros per jet for the 108 jets proposed to be built at HAL.
Consequently, Dassault refused to partner with HAL and explored a private vendor (Reliance Defense and Naval’s new offshoot, Reliance Aerospace). For those who don’t know Reliance Defense, it operates our largest shipyard and manufactures corvettes, stealth ships etc for the Navy and has a massive heavy engineering division. For Some Mavericks, Reliance is ‘anathema’ for reasons best known to them while Tatas is palatable!
Coming to the cost of the deal. We need a decisive advantage in the air against Pakistan and China. The Su-30 MKIs are made in Russia and the Chinese know this aircraft very well. They have purchased their own Su-37s and Su-35s to counter and we have virtually no response to them. Consequenly, Modi changed the paradigm by getting a virtual 5 gen(enhanced 4.5gen) jet which gives us some combat capability against the Chinese. These jets come at nearly twice the price of the Sukhoi 30 (91 million euros) and were supposedly planned to be acquired by the congress at an even higher price. Infact so much so, that the congress would end up paying 14 billion euros for the same 36 jets if they included all the weaponry and support they have in this deal. The BJP saved us 6 billion euros. We should be thankful.
Please take a technical course to those in opposition who really don’t understand. some refuse to understand is another story. Also the JPC jargon: it is only a political muscle; It works on political lines and has not brought any investigative techno-economic issues in any of the scams earlier, including Bofors (Shankar Anand committee legalised the corruption money in bofors payoff as ‘winding up charges’… )
For various reasons the track record most of the defence PSUs, particularly of Aeronautical Development Agency and HAL, is poor. The development trajectory of the indigenous Light Combat Aircraft ‘Tejas’, for example, took more than three decades. One reason could be, there is no compulsion to perform as in any government organisation. Also, It suits those in power, since the defence purchases are ‘kalpa vruksha’ as they are big ticket imports. It quenched the thirst of all those involved, be it, those in power, bureaucrats, defence personnel and ‘notorious’ middle men. Seven decades have passed, No point in shedding crocodile tears now.
When india was born, the eco system demanded government investment to create institutions for research, development and production in public sector. But the country has grown sufficiently in both capability and financial muscle. More than nurturing PSUs by pouring tax payers money, a competitive private sector can also have their share of ‘cake’ and raise to ‘occasion’.
What is the remedy? There is a shining American model to emulate: Create military industrial complexes comprising of a web of defence research universities, domain experts and private companies that can quickly assess the country’s strategic needs and translate this into modernisation and weapons platform development. Unlike defence PSUs, private players will be nimbler as they have a better work culture and won’t be bogged down by India’s notorious bureaucratic style of functioning. What’s needed is a plan to build an indigenous private defence complex that will be vibrant within the next decade. That’s what government and opposition should be discussing, rather than playing politics with defence.
Blind opposition to private sector may hoodwink the voters in the election time but would not be in the best interest of the nation in the long run. Don’t create rhetoric over private players in defence production to get the votes! The opposition firmly believes that unless some corruption stain stays on Modi, he would be invincible. This has worked in bringing down earlier regimes.
If you want status quo on policies that would bring in transparency and keep the middleman at bay, what can be done? stir controversies during election season and repeatedly talk loudly about illusory mega-scams to frustrate those making changes! Opposition follows in both letter and spirit what Hitler once wrote in his biography ‘Mein Kamph’ ‘the most brilliant propagandist technique is one that confines it to a few points and repeat over and over – even a blatant lie would take the hue of gospel truth’!
The government is forced to be on its back foot and played safe. What has taken the hit? Defence sector make-in-India policy is still in draft stage! The defence output from the proposed defence corridors in UP and TN would not pickup the way one wishes it to be!
Hit by the Rafale controversy, the defence ministry has not moved to amend its offsets policy since May this year, when a draft was presented for comments. A new defence production policy that was promised in 2018 has also met a similar fate, with limited forward movement since the draft was issued in March. Potentially huge foreign investments especially for meeting offset conditions, are in suspended animation due to non-finalisation of these policies.
The extremely cautious bureaucratic approach in finalising the draft involving all the stake holders, in this potentially lucrative defence sector, is understandable. The ‘house of defence manufacturing & procurement’ is infested with lot of cob webs and well fed rats, requiring ‘sweeping’ changes if the targets have to be met…. but a golden opportunity is not to be missed…..!
Subsequent to the dismissal of the petition by SC, Govt moves SC seeking correction in para which makes reference to CAG report, PAC:
In the judgment on Friday, the apex court had noted that the pricing details have been shared with CAG, and the report of the CAG has been examined by the PAC. To quell the misinterpretation of the documents submitted in the sealed cover, in the judgment by the court, the government has submitted an application to the court.
The issue of CAG and PAC was mentioned in para 25 of the judgment of the top court which had held that there were no irregularities in the procurement of 36 Rafale jets from France.
The judgment had said that the material placed before it shows that the Centre did not disclose in Parliament the pricing details of the Rafale fighter jet, but revealed it to the Comptroller and Auditor General.
It is a pity, even after all these, a lay-Indian voter believes ‘there must be fire even when there is no smoke’ based on the congress corruption culture!
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