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In a recent analysis on the defence deals that India has made since the Kargil conflict in 1999, it has been revealed that over $50 billion has been spent on the acquisition of fighters, warships, tanks, missiles and other weapon systems.
According to Indian Defence Ministry officials, India spent $12.5 billion on `direct capital acquisitions’ in the 1999-2004 timeframe. In the time-frame of 2004-2009, this figure has doubled to $27.5 billion. In fact, the three services have entered into 465 contracts worth over $27 billion in the past three years alone. Recent acquisitions included Airborne Early Warning Systems, Unmanned Aerial Vehicles, T-90 and MBT Arjun tanks, Advanced Light Helicopters, Sukhoi-30 MKIs and various weapon systems for the armed forces. Officials added that most of the defence acquisition has been from the international market and future imports worth $30 billion are expected in the next five years.
Amongst the major international acquisition deals that have occurred, are Israel for three Phalcon AWACS for $1.1 billion in 2004. Recently, an Rs $2 billion project to jointly develop medium-range surface-to-air missile systems has been linked with Israel as well. With the US, India struck a deal for six C-130J Super Hercules aircraft for $962 million in 2007. More recently, eight Boeing P-8I planes for $2.1 billion have been finalized for acquisition. In 2004, India inked the package deal for the ‘Gorshkov’ aircraft carrier and 16 MiG-29K, with Russia. The price has now escalated to $2.3 billion. As for the UK, India inked a deal for 66 Hawk AJTs in an Rs 8,000 crore project in 2004.
Recently, the Defence Expenditure Review Committee (DERC) report have pointed out the shortcomings in the acquisition process, which led to the inability of the three services to utilize $8.5 billion between 2000-01 and 2007-08.
However, the Indian Defence Ministry is confident of making the most of the opportunity since some of the big projects are in the offing. These include; the $10 billion project for the 126 medium multi-role combat aircraft (MMRCA), $6 billion project for six new-generation submarines after Scorpenes and the artillery modernisation programme to acquire 1,580 towed guns, 814 mounted gun systems, 180 self-propelled wheeled guns, 100 self-propelled tracked guns and 140 air-mobile ultra-light howitzers. The artillery modernisation programme is to the tune of $4 billion. Another project for around 800 helicopters, ranging from VVIP and heavy-lift to attack and light utility helicopters worth $4 billion is also coming up.
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