Israel develops capabilities, India pays the bill - Broadsword by Ajai Shukla - Strategy. Economics. Defence.

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Monday 8 February 2010

Israel develops capabilities, India pays the bill

India's first Phalcon AWACS was delivered by Israel on 25th May 2009. Here it touches down on Indian soil for the first time, at Jamnagar Air Base.

by Ajai Shukla
Business Standard, 9th Feb 09

For many Indian commentators, especially those on the right, Israel provides an inspiring example of how to deal with external threat. One could equally argue that notwithstanding its comfortable position as the regional hegemon, Israel and its citizens remain insecure, xenophobic and afflicted by a disturbing sense of victimhood. It’s a debate that continues, especially in that country.

What Israel unquestionably does illustrate for India --- with this country paying hundreds of millions of dollars annually for the lesson --- is a well-considered plan for building their defence industry. In becoming India’s biggest defence supplier, Israel has bared a hard-nosed strategy that our policymakers must grasp and emulate.

Since Israel does not market aircraft or ships, its defence companies have focused on the lucrative market for upgrading India’s predominantly Russian weaponry, including MiG-21 fighters; ship-borne missiles; and T-72 tanks. Their first step was to understand Russian technology, for which Israeli defence companies accepted initial contracts at cost price to build their engineers’ capabilities. With that experience gained --- at India’s cost, one must note --- Israeli systems designers progressively graduated up the complexity scale. Today, Israel’s defence industry, with capabilities honed across a generation of Russian platforms, can bid across the globe.

The opportunities for Israel are vast. Some 30,000 T-72 tanks are in service worldwide, including 2500 in India. But Israel, not India or Russia, will feed off that upgrade market. India provided Israel with the tanks, the opportunity and the money for creating that capability. Ironically, the MoD ignored India’s own defence industry; its undeniable competence could have been as easily translated into capability.

Israeli industry garnered another windfall from its offer to build the Phalcon Airborne Warning & Control System (AWACS). This airborne radar mounted on a Russian IL-76 aircraft, allows airborne controllers to monitor and control airspace for hundreds of kilometres around. No Israeli company had ever designed such an AWACS before, but India handed over US $1.1 billion (Rs 5000 crores) to Israel Aerospace Industries (IAI) and Elta. Hundreds of Israeli designers learned on the job, building AWACS capability on Indian money. Israel will now build another three AWACS for India, several for the Israeli Air Force and export more to Chile and Singapore.

Another feeding trough is the ongoing upgrade of Indian Navy ships, especially the technologically challenging system for “net-centric operations”. This digitally interlinks the fleet’s sensors and weapons --- in the air, on the surface and underwater --- into seamless information and command networks. The two Israeli companies bidding for this strategic contract, Rafael Advanced Defence Systems and IAI, began building capabilities while fitting Indian warships with the Barak missile early this decade. With detailed knowledge of the warships’ Russian combat management system, Israeli engineers are now ready to design the net-centric operations system, the crucial nerve centre in war.

In this, as in other upgrade contracts, India’s MoD has ignored the advantages of building indigenous capability. Precision Electronics Ltd, a Delhi-based company that engineers high-tech defence electronics, joined hands with US giant, Raytheon, to bid cheaper than Rafael and IAI. It seemed as if, at last, Indian capabilities would also be built. But, mysteriously, the MoD scrapped that tender last month. There is no way to verify the industry buzz that the Israelis contrived that cancellation; the only thing known for sure is that Rafael and IAI are being investigated by the CBI for corruption in the Barak sale. But it would be safe to bet that, when fresh bidding is ordered, the Israelis will come in with cheaper prices.

The Israeli strategy is: a financial loss is acceptable, to curb Indian defence industrial capability. Each time an Indian company develops capability in a strategically vital domain, foreign companies will be shut out from that realm forever.

Strangling the competition at birth is business, not criminal activity. Israel can be expected to do that. What defies logic, though, is the MoD’s dogged refusal to nurture Indian R&D the way it has Israel’s. This is of a piece with the MoD’s approach to Russia during that country’s troubled 1990s. With Russia’s economy bankrupt and military design bureaus and manufacturing units in dire straits, India placed a string of equipment orders --- Sukhoi-30MKI fighters; Talwar class frigates; and T-90 tanks, amongst others --- providing life support to that dying establishment. China, in contrast, simply bought over a bevy of top Russian design engineers, paying them to live in China and build capabilities within China’s defence industries.

Ashok Kanodia, the MD of Precision Electronics, admires and envies the Israeli companies. Admitting that his own strategy involves bidding at cost price, Kanodia explains, “My gain will be the engineering capability and experience that is created, with the MoD paying the bill. Monetary profits are for later.” But he ruefully admits that, with the MoD apparently unconcerned with developing Indian capabilities, Israeli firms are now unstoppable.

The MoD, it would appear, has failed to understand that the essence of defence indigenisation is about building domestic design capability. All that South Block seems to have is an oft-repeated target: moving from 70% reliance on foreign equipment to 70% supply from Indian companies. But how exactly this will be done, the MoD has never pronounced. Since a target cannot substitute for a strategy, it is time that South Block implements a clear policy that would allow Indian companies --- especially in the private sector --- to build their capabilities with some assurance of business. That might be the best thing that Israel has done for India.


  1. "The MoD, it would appear ,has failed to understand that the essence of defence indigenisation is about building domestic design capability"

    Some would argue the understanding is as designed.

  2. Isreal get's some much input from the US in terms of collaboration with american defence companies. They also have had this luxury for decades.

    What they are selling is crap. Why don't they give us AESA instead of multimode radar?

  3. excelent article. I admit I'm an admirer of much of israel's actions in how it manages its affairs but that is no excuse for MOD to continue its blinkered existence.

  4. Ajai, there r many JV's going on between Israel n India, u r overcritical in the analysis

  5. As long as government is involved with something we can rest assured that it will fail, their solution to every problem is to create a new department,
    problem: climate change organisations are being questioned about their research,
    solution: easy, lets open a politically controlled organisation that is less independent in expressing its thoughts than a North Korean farmer.
    Problem: Education.
    Solution: lets make education a fundamental right, and find the funds to provide this right later.

    The only thing that can happen is with the trend we see now, the Indian firms which are putting their consistent profits into R&D start to innovate in the coming decades.

  6. Makes for a depressing read. Indian scientists and engineers would be better off working for the Chinese defence sector since they have a better policy. Do the Chinese companies recruit from India?

  7. Ajai Sir

    Wasn't I right in saying time n time again that India desperately needs to develop its refurbishing and upgradation facilities.

    I had long back said in 1 of ur articles that India needs to develop a dedicated concern for refurbishing and upgradation defense systems.

  8. Thanks for this great article.

    I think ordinary mortals such as me dont know how the defence industry world works. This is for the first time that I see some of the truth behind our dealings with Israel.

    Once again, I see our shortsightedness in defence matters. It is great to read through your article that our industry is also learning from the Israeli experience on how to build a private business.

    This is something that our software sector has been doing for sometime now, I believe. With companines like Wipro, TCS, Infosys spending more on R&D then Microsoft and IBM.

  9. I agree completely. I posted a comment saying we should be following this approach in one of your earlier posts titled "India to develop 25% of fifth generation fighter." In addition to what I had mentioned their another plus to following this method of weapons development would be the leverage we would gain when choosing to upgrade or not upgrade weapons of third parties such as Middle Eastern or South East Asian nations.


  10. Well isrealis have been the people on whom we can depend even in the time of war. They have always been innovative with their military hardware and they had a pretty decent AWACs program when we bought the package from them. We need to remember that they were about to sell the same to the chinese and because of US intervention we ended up buying it. Common Ajai give them some well deserved credit, your article sounded like something sponsored by the Precision people.

  11. Indian firms are all greedy entities manned by traitors. They are all out to help India's internal and external enemies. They will sell all our secrets.

    Naturally with all these concerns, it is safe to let foreigners uphold India's defence. India must be protected from Indians at all costs.

  12. This article should not be seen as criticism of any country. Ofcourse every seller will look at its own benefit. And even the article says that they sold their services at cost price or even loss for learning. So they did give us a deal. The point is getting a good bargain on individual deal is short-sightedness overlooking the long term gain from homegrown expertise.

  13. Brilliant work Ajay! You hit the nail on the head

  14. I agree with Anonymous @ 8:40.

    It is an open secret that the Israeli MIC is really a mask of the larger American MIC, which has covertly and overtly supplied and replenished it with bleeding-edge technologies in sensors, radars, avionics, missiles etc.

    The MoD is criminally guilty of not giving DRDO a chance to develop such systems, and awarding it to private Israeli companies.

    Thank you.

  15. Ajai Sir, you are indeed a journalist with difference and nobody can never dare come close to you in quality and responsibility to the motherland.

    Thanks for bringing truth to general Indian in the way it should have been.

  16. I hope we remove all babus from defence related R&D and purchase as babus have failed Indian state on most fronts. These babus and neta's have exported billions of dollars of high tech. job and tax mony to their birader.

    They ( babus and neta )say they cannot get best talent, I say them pay them best pay scale and do not create any hurdles in their research. These researchers should be accountable too.

    I think, I should not shy saying about myself. I am a researcher in optimization related algorithm to optimize multimodal functions. First time I developed it ( algorithm) I almost gave it up. However, after smart moves, I learnt how to get the algorithm working.
    I will like to all babus and netas, do not export the billion dollars to other nations. Invest the same money in us ( indian R&D), we can give a far better system . There might be many failures but in that failures lies answer for new system.

    You ( babus and netas) are exporting our tax mony to other nation, this is a daylight robery.

    I hope some one file a RIT and find why our R&D in defence is low, why do you import all weapons. Its a artificially created situation where our defence industries are forced to under-perform. May be these industries and babus share the kick back money.
    even if its top secret file, we youth, have right to know, why aren't the same defence related R&D is not available in India.

  17. hi,
    I would like to say why India is spending time and money for Israel engineers.Is it not possible to train our own engineers to work on that defence system like tank etc and develop on its own.Or can't we become a part of the Israel team which are learning on that defence systems.

  18. What a bunch of nonsense...!!
    How will India built a Phalcon AWACS system which is best in the world without Israeli Radar..? We even had to pull in Israeli lobby(AJC) to help clearance from US of A. Giant screw-ups like LCA Tejas,Trishul, Arihant,Airavat AEW,HDW sub,Bhim artillery,Akash etc are attestment to the fact that we can't do anything straight with our crappy red-tape,turf-wars and general lack of strategic vision..Bashing Israel for our failures..and on top of it..give an example of a loser Indian company to prove the point is obnoxious oversimplification.

  19. Ajai,

    It must be noted that Israel gained from a huge influx of ex-Soviet Jewish talent during and after the break-up of the USSR. That expertise provided the seed for this whole new industry (among others).

    However, you're right in your primary observations on Indian strategic behavior. It is quite apparent that successive Indian governments seem to be incapable of long-term planning of any kind. The defence sector is no exception. It seems to be all about immediate gratification (follow the money), and the next election.

    Keep up the good work!

  20. Shuklaji, read this article on the Israelis.

  21. Ajai,
    there is a major error in your article. You claim that "No Israeli company had ever designed such an AWACS before" however such an awacs had been designed for China based on the same platform as India (which was cancelled due to American pressure)and also the condor for Chile on a Boeing 707 platform much before the Indian system was even signed for.

  22. Achyut Pandya:

    It would, perhaps, be better to argue about the issues involved rather than wasting time and looking stupid discussing whether I was sponsored by Precision or you are sponsored by the Israelis.

    Let me clarify, for the benefit of people who tend to see the world in simplistic monochromatic terms: this article is not critical of Israel or the Israeli defence industry. In fact, I specifically mention that what the Israelis are doing is legitimate business practice!

    If there is a focus of criticism in this article, it is India's MoD for not conceiving and implementing the vital strategic aim of BUILDING CAPABILITIES in our own high-tech companies.


    The "obnoxious oversimplification" (what a strange phrase! First time I've heard it used) is only in your own mind. Try and understand before criticising.

    Nobody is suggesting that Indian capability will be built by handing them a major platform, like an AWACS, as a start-point. I'm suggesting that, to take the AWACS example, the MoD should have first asked companies with proven design capabilities what components, sub-systems, or systems they would like to develop in India. Then, Israel should have been told that they would get the contract, subject to those components being developed by the companies concerned in India.

    That's how you build capability. The next time, those companies would end up building 50% of the system. The third time, they would not let Israel get a sniff of the business.

  23. Sandy, can't read your link. Can you plz email the article to me at

    thanks very much!

  24. Its a Good point u have here Ajai ... When will we Indian learn ! We got competitively high num of Grads Passing out every year .. what are we doing with those brains ! :( ...

    Israel ~ can be made a model when it comes to defense tech development & even dealing with terrorism !

  25. Hello Ajai Sir, always been a fan of your works. I would just like to point out that you made a slight error with the date of the report. It shows 9th Feb, 09 instead of 10. Hope it gets corrected soon.
    I have one request, why don't you provide an RSS feed of your blog? It would greatly convenience regular visitors such as me.

    Wishing you all the best.

  26. At the end of the day, the Israelis are getting the job done, while our scientists, we're not so sure...

    I don't think we have the resources to do everything by ourselves, and do it in time. If you're in a hurry to have these weapons soon, you're going to have to spin off some work to people who can do it better than you.

    But getting milked off $$$ for it hurts the nation. And then there'll be vested interests who want to keep doing this indefinitely into the future.

  27. Hi Guys,
    Some comments on Israel. I spent some time in Israel. I know how the Israelis work and what is the reasons for their success.

    Most of the Israelis, I mean Jews, they work for their country. Different Jews have different opinions or view points, but when it comes to their country, they are just one. And their most important part is, the importance of education and equality of women. Israel has NO natural wealth (except Bromine from Dead Sea), unlike Muslim countries in the Middle East who sit on oil. When countries like Saudi Arabia, UAE, Iran, Iraq, etc spent the oil money for the benefits of the royal clans or rulers, Israel used their democracy very well and improved their education. When rich countries like SA spent money for nothing (especially gambling), Israel made part of Negev desert into farm land. There is a kibutz started by the Jews migrated from Cochin. No other country in the world is as success as Israel in agriculture.

    They also excel in telecommunication business. They own so many patents that 23% of the country's income comes from patents or technology they developed. Even Arab Countries (even SA) hire Jews for the telecom service because of the patents owned by Israelis. In India, our Commies and Muslim organizations are damn against doing business with Israel.

    Anyway, When it compared to education, engineering, R&D, Muslim Countries are at least 70 years behind Israel. I heard from an Iranian guy that, in Iran more than 60% of the scientists and Engineers are working weapon related programs- how to make weapons that can destroy other people.

    For India, any cooperation between Israel and India, benefits India tremendously. Israelis adore India and Indians than any other countries, even better than Arabs adoring Indian Muslims.


  28. Kannan, I hope, I said, I have done research in optimization: optimize multi-modal functions in high dimensions. As most knows dimensionality adds to complexity of finding best optimal value in high dimension. We tried to prove, do we need complex algorithm to find best optimal value of a function (near to real-world problem) in high dimension.

    Even before I developed this algorithm. I played with many concepts and ideas even before I went to step one of developing this new algorithms. It too me many days of failure and few days of success to develop this algorithm.

    I would say its (algorithm) is not one of the best but I have an idea to develop better optimization algorithm using a law in chemistry.

    Leaving aside the boasting of my research work, I will say about HAL Koraput. My dad used to work there and many innovations in MIG engines were developed at this division. However, the Indian-Russian contracts say no one other than Russian can introduce the innovation. In short these innnovations were given to Russian representative free of cost.

    I would also like to site a example, a bad (very smart) advice by babus to Prime Minister Jawaharlal Nehru led to skewing of all development funds to Gnatt and Tank.

    I have many more examples; TV, cycle, motorcycle, planes, etc being built by innovators would not have see the light without the political backing; have you eve watched the episodes on discovery channel on how US innovators starter development of first fighter aircraft. I would like to inform you, there were many,.. ,many failures but they never gave-up.

    I think all my above examples speaks, one should have an ability to listen to other views, analyse them before he/she flashes his/her 32 teeth's.
    Oh! good advertising of pepsodent toothpaste.

    I will like to conclude with the thought, no one said to the bumble bee that it structure is aerodynamically not suitable to fly.

    A prejudice about others will lead you no where.

  29. Here is the complete link posted by Sandy.

  30. Another though: no one says, do not do mistakes, but its foolish to repeat the same mistake again and again.

    Implementing the above thought to our neta and babu: they have been repeating the mistakes of not funding serious R&D, no independent procurement body for defence and bluffing TOT in defence procurement.

    Serious R&D, I doubt these babus or neta have ever put their mine in research.

    No procurement body for defence: babus and netas with their ego are on venture too make best money for their swizz account. Who cares about Indian job opportunity and fighting machines.

    TOT in defence is a white wash, they are fooling Indians with word TOT. Leaving aside the thought that we (Indians) do not have expertise to absorb technology. I would say, had the Indian R&D sector received the realistic TOT, we would have been exporting most weapon systems not importing most systems.

  31. Khanna,
    May be you can enlighten us on why we can never develop weapon systems.

    Here I have an axample (example ) of Project execution.

    *Identify components needed
    @ critical
    @ semi critical
    @ non critical

    * identify budget resources ( human and non human) and time frame.
    - capital
    -spending on resource development
    - training
    - education leave
    - short/long term term training in India/abroad
    - Machinery
    - other expenses

    *non resource development ( procuring sub systems)

    The list goes on.
    Through a structural development cycle, the time taken, the abilities can be classified. khanna babu, we can develop any system if we want to.
    Else we can repeat the same old story, kya kare bhai ham to kuch nahi kar sakte. saab uper wala ka maherbani hai.
    Upar wala pair haat diya aur muft ka dimag diya hai, to use karo.

  32. Ajai ji,

    As always, your views are very thought-provoking. I wonder if you can be an independent consultant to those vision-less policymakers who need some fresh ideas as to exactly how to run South-Block's indigenisation drive.

  33. I just stumbled on this blog. I'm a PIO (Person of Indian Origin) in the process of retiring in Kerala. As an outsider, with compassion for India, I see the problems India faces. My understanding is that...
    1/ India is Old and problems of ageing suffer we all must.
    2/ Like the quest for the holy grail and stem cell research it is for you the new generation to overcome the indian "cancer" of curruption, poverty, fanatic ignorance.
    3/ My experience in Kerala of establishing residency reveals how crazy communism and political ego is due to public fear. Kerala is supposed to be the most literate state !! Go figure!
    4/ If I as a mere PIO cannot trust Indian Banks..... How do you expect the Defence Minister to trust Indians with secrets.
    5/Due to long standing poverty Indians greed is not staisfied. Every Indian wants to be elsewhere than in India. When visiting Kennedy Space Centre, Cape Canarvel most scientist working there were Indian Scientists!
    6/ Satisfy the greed and you shall then have a dedicated generation.
    7/ In closing, I am lucky to be born with "Material Wealth" educated in Africa, India, UK and Canada. I have explored the places and conditions that forced my ancestors to leave India. I understand the non-violent phlosophy of Indians and admire their humble character and steadfast beliefs. I understand Indians love for life, art, cultures and knowledge.
    My quest for soulful growth has me fascinated with South India. Why? Why India? My only conclusion is, once your thirst for "Bling Bling" is quenched the SOUL looks beyond greed and fear. India has everything to fulfill life at it's fullest only that us Indians can't see it yet, due to the thirst of greed. Your challenge as the youth of India is to fight poverty and Bling Bling India and loyalty amongst Indians shall grow. How you guys can acheive this with stupid aggressive neighbours is a mystery to me. Is the pen mightier than the sword? Do you have to feed a dog occasionally to tame it?
    Only my POV.

  34. Lot of misinformation in this article:

    1. ELTA had built Phalcon for Chile BEFORE they even got a contract from India. In fact, they were not even offering it to India but to China. That sale was banned by USA (thank God). Realizing the potential of such an advanced early warning and EW capable system India jumped in to it- very smart decision.

    2. T72 modernization from Israel was offered to Poland and Egypt by IMI. Israel obtained many T55 and T72 from Lebanon war in 1983. They actually USED T72 in modified form for their own army. (India had supplied parts for them as a friendly gesture) So, them learning from us with our own money is pure fantasy.

    3. MIG 21 upgrade: Israel upgraded Romania’s MiG 21 called ‘MiG 21 Lancer’ BEFORE offering the same to India. India rejected the offer and went to Russia instead.

    4. RAFAEL offered free data-link installation on entire IAF fleet. The reason was not to learn anything but to get future Derby and Python contracts. The bid was rejected and IAI was invited instead for $3.2 million.

    Indian journalism is inconsistent at best – full of moaning instead of giving a credit to deserving party. No country or a company will work without gaining anything in return. India is NOT strangling its own defense sector by paying Israel. It is strangling its defense sector by not letting full FDI and by favoring inefficient organizations like DRDO taking the full pie of all contracts.

  35. Abhijna, I appreciate your views on Israeli appreciating Indians.

    I appreciate, USA, French, Russian and other countries friendship and greatness.

    However, when it comes to innovation of any technology there is no friendship.

    If Indians learn to develop their own technology, then there could be an option of being superpower else even in their wildest dream Indians should not think of being superpower.

    A country (India or any other) is never bad,the people who rule them and live there make her (India or any other country) great/powerful.

  36. Ajai sahab:
    One has got to walk before we run. Your article though right in spirit, actually is unfair to Israel. They are selling us modern technology, that not many countries will share. One can easily argue, that just like the Russkies, they sell us some, and do joint ventures on some things. Your article would have been more accurate if you had selected the US as the target of your ire.

  37. Just a couple of clarifications, to rebut some misinformation, especially about the AWACS:

    The AWACS that Israel built for Chile was a relatively primitive and technologically deficient platform (and was mounted on a 707 aircraft). There were several widely-known problems, e.g. it provided acceptable solutions in azimuth, but not in other dimensions, especially in detecting aircraft at longer ranges. India's AWACS is in a different technology generation and required pretty major re-engineering, which Elta successfully provided, even though the AWACS hasn't yet been fully proven as an IAF platform. The problems with the Chilean platform have been widely documented in magazines like Aviation Week.

    The AWACS that israel was building for China had lots of problems which had not been resolved by the time US pressure forced Israel to cancel the contract. Read, for example:

    Everyone knows that Israel captured Russian equipment from Arab armies. But, DJ, in everything after that obvious statement that you're wrong. India's upgrades were India-specific, and could not have been done for any other country. For example, India required a Digital Control Harness for internal radio circuitry within the tank. Anyone who knows about tanks will tell you that this would not have been designed for East European armies.

    By the way, DJ, Poland offered India a fire control and night vision system, competing against the Israeli TIFCS. You're telling me that Poland bought the Israeli system? Or what??

    The point made about Rafael offering free data link installation on the IAF fleet. If that's true, and we have no proof of that, it corroborates one of the basic arguments in my article... which is that a short-term financial loss is an acceptable tool to crack open a market for future, more lucrative business.

    Indian journalism may well be inconsistent. But, DJ, as you can see from the above, you're pretty inconsistent yourself. Perhaps that's why you keep coming back?

  38. Hi Ajai,
    I am at a loss to understand why we cannot get the students at the IITs & NITs to work on DRDO projects as part of their studies. The IITs & the other top institutes were setup to cater to Indian needs but they are doing just the opposite. If we are going to let these guys go abroad anyway, why not take our pound of flesh before letting them go.
    It may sound harsh, but my heart bleeds reading about the colossal waste of human resources.I hope Kapil Sibal reads your article.We really need to get pro-active. Please man, do something.

  39. Ajai, your article is now being used for propaganda purpose. The heading suddenly changes to "Is India paying for Israel's nuclear capabilities?" in the MSN article.

  40. First of all, i would like to thank you for the brilliant articles that you have written. When i had read the "Tank-Duel in the Desert", i could not believe my eyes. Tanks are the mainstay of any modern army. Without good tanks our soldiers are sitting ducks! (Moreover, what angered me more was that a certain film-release was given first-page but your article was'nt, which reflects on the importance given by the public to those who risk their lives to save ours).
    I am not an expert on defence matters, but i study at a reputed engineering college, and i would just like to make you aware of one fact- that our engineering graduates are'nt as good as you may think. There are VERY few who are really good, even at the so-called prestigious colleges. The best of the lot leave the country seeking better opportunities.
    The point is that if there are PRIVATE companies to produce defence equipment then they will have no shortage of talent- it is not that the talented people WANT to go abroad, they just don't get the same kind of rewards (and recognition) for their work in any govt. organization. Once there are corporations producing defence equipment, i can assure you that we will never depend on any foreign company (except maybe the very high tech weaponry, which requires extensive investment in R&D. We will get to that, but it will take more time, though not as much as you might think..). I can't imagine why India has to pay expensive Israeli engineers to do jobs that Indians will do at a lower salary too? If it is quality assurance, we can have that too- private companies will want to do more business, so they will have a reputation to keep up.
    I think the whole problem is that the govt. is still smarting from the bad experiences with the private sector (and DRDO) during the Licence Raj. We must remember that the economic conditions were very restrictive then- and good technical manpower was scarce. There was'nt really anyone who could really do the job, so many crooks just got in to get what they could from the govt. But now the situation is different- superb design tools are now available cheaply, we have a strong manufacturing sector, and enough dollars to import whatever else we need. We also have larger defense contracts- a large military that need to be quickly modernized and constantly kept so. Such large contracts were probably never there before. Would'nt it be wonderful if all those billions of dollars went back into our own country to develop our own weapons, suited to our needs? To develop talent, to develop our own industries- it will have a ripple effect, from which many other sectors will benefit (look at USA).
    My advice is that the govt. should give the private sector another REAL chance. Is is very UNWISE to rely on foreigners for OUR defense- their loyalties aren't to our nation!

  41. To Mr. Kannan, The Phalcon is indeed one of the best AWACS in the world but is now outclassed by the Boeing Wedgetail which is even better. We did pay for the awacs and for the developement of the latest avatar of the radar and other avionics. The old Phalcons were quite simply not good enough. The US has many parts in it all well and hence they have a say in sale matters. When US cleared it for sale and stopped Issy from selling to China, it showed a growing trust in India and supported us. Lets not rush to call the LCA a screw up, its still the world's lightest and smallest supersonic 4.5 gen aircraft, the mk-2 avatar coming out in 2013-2014 will not only set a new benchmark but out perform every single one engined 4.5 gen airraft in the world. Given the GE 414 enegine, the 98KN of thrust will allow it to supercruise with a full load at speeds over mach 1.2. It will have MATV, kick ass counter measures, IRST, jammers, EW suite, Indo, Russian and even western weapons.

    Bhim howitzer indeed has been cancelled but advances in local technology will allow us to bring it back, its only a mtter of political will. You forget that India is the harshest terrain for any weapons demonstration and the very best of the rest of the world has a hard time working in India.

    Trishul, well they are looking for a foreign joint venture partner to help develope a new quick reaction SAM.

    The Akash is one of the best modern SAMs in the world with RAM jet propulsion, state of the art seekers, no loss of thrust during flight, accuracy better than the PAC-3 patriot, speed between mach 2.8 & mach 3.5, an order book with over 1000 missiles both from IAF and IA, due to ground based missile guidance, it gives no warning to the enemy, 48 missiles in ready to launch mode in a Akash Squadron. They can protect between 3800km2 to 5000km2. They have very sturdy support vehicles and launchers that perform in the harshest of terrain, so lets not rush to call it a blunder, its actually far far from it.

    We dont have HDW subs but yes the Scorpene is delayed but hey thats what we get for buying from France, they are the worst to deal with in business. From Scorpene to mirage upgrade deal, they suck.

    India has lots of internal problems but we can manage any challenge given the political will.

  42. After reading this article I was angry about the MOD. It is a shame that we boast of ourselves as a super power and still have 70% of our military needs met through imports.

    The article talks about how the system is visionless, ineffective and how it is making India dependent on other nations with out Indegenous capacity building. Rather than concentrating on the large picture, which is the system and procedural failure, lots of bloggers are concentrating on smaller things.

  43. Along came a spider-I am sure this will raise many comments of deja-vu (Indian defence industry should be allowed to develop, netas making money out of sending defence projects outside etc etc). But a post from a defence expert like you is sad.

    Yes, Israel is getting key contracts from India (along with Russia, France, UK & US). Let us examine the major contracts israel has won

    -Mig 21 Upgrade: HAL has been serially manufacturing the Mig 21 since 1970.

    Why was HAL not able to do the same work that Israel took up (Israel has never operated Soviet/Russian aircraft).

    So what does the IAF do when the Mig 21 cannot be upgraded by HAL? Twiddle their thumbs. Well,the planes had to be upgraded and it went to the L1/T1 vendor. Who was it? Israel. Did they do a good job? Looks so.

    Question for you Ajai-Don't you think we should question why HAL could not upgrade these aircraft after manufacturing them in India for 30+ yrs?

    - Barak: There was a project called "Trishul". Money flowed into it, people made "promises" of performance and the there was happiness. Well, life is not a Hindi movie. Did it hit targets? You gotta be kidding me. What will the IN do? Its ships are un-protected. It cannot send it ships to war without anti-aircraft protection. Search for a SAM globally. Lo, the Barak. It works (10/11 hits apparently). So who do we blame-Israel for marketing a product or India for failing to make a missile? Your call.

    -AWACS: Well, Well, Well. HAL did try here. They rigged a HS-748 with something and it did fly. Did it work? Ummm...the HS-748 crashed. Ohh sorry, so did they build another one? Well, u see, they could not because the sun was shining, the wind was blowing what does the IAF do? It needs AWACS. Buy from the market. Which it did. And at $375 M a pop-the Israelis were the sasta-sundar-tikao option.

    -Mirage 2000 Upgrade: Disclaimer-Israel has not won this. Dassault had quoted a Rs 13,500 crore/51 planes cost for this upgrade. IAF went back and pared its wish-list. New Cost Rs 10,000 crore/51 planes. Israel has proposed to do the "original" upgrade at Rs 5000 crore.

    Question: Israel has no relationship with Dassault post 1967 (6 day war) when France refused to support Mirage 3 bought by Israel pre 1967. How can they upgrade Mirage 2000 and why cannot HAL do the upgrade after maintaining M2K's for 20 yrs? Isn't this the question to ask?

    We have quite a few success stories-Dhruv, Prithvi, Akash, Pinaka, 15A, P-28, Arihant;the list is long and i am proud for each of these as an Indian.
    But having known the Public Sector set-up, i am surprised at a success. We need to retrospect and set our house in order (a more difficult task) in opposition to fighting the foreign body to pull ourselves from this mess.

    Do you remember a time 20 years ago (1990) when you had to go to the Telephone office for 6 months, write letters and grease palms for a phone. Did blaming the DoT help? zilch. What made us turn around to a time like today where a phone can be had in 10 mins? The same needs to be done to the Indian defence industry.

  44. Anonymous 10:16:

    You've not fully understood the thrust of my article. Is there no possibility of building capabilities in India's private sector, as another engine for indigenisation.

    I have often written about HAL's, BEL's and other DPSUs' failures in absorbing technology. Does that leave us with no options but to go running to the Israelis?

  45. sure India has to depend on imports a lot, but rest assured guys, we get the best from Russia, Issy and soon the US. We are poor at reverse enginnering, we'd rather take years to understand, which is why our know how is better and our weapons which work are much better, our ballistic missiles far more accurate than many others, our cruise missiles not bad at all, our EW suite, LCA etc are all very good.

    We will slowly become independent and while we do, the quality of our systems will be unparalleled. slow and steady wins the race guys. We will make it happen slowly but surely, what we need is the political will and funding.

  46. You can bet that the software and hardware will be full of trojans and kill switches. It is standard practice in all defense equipment. Israelis would be failing to do their job if they neglected to put those in.

  47. These are powerful motivating factors for Israel. These are not its weakness but the source of the very strength that you envy. The Israelis are hardnosed because doing anything else has lead to disaster (how violent would the West Bank and Gaza be if they HADN'T agreed to the Oslo accords and allowed the PLO to return? If Hamas never was able to take over Gaza?).

    So, yes, India is wasting its chance to develop an indigenous production capacity, but it is not for any of the reasons you mention. It is because India is not hungry enough to improve and too hungry to wait.

    It is because India does not want to start with 1950s technology and build up from there. It does not want to invest in building small arms and basic infantry equipment and armored vehicles before building supersonic fighters. It does not want to try developing its own tanks when it can buy Russian designs (and never learn how to improve upon or replace those systems). It does not want to start by building the equivalent of a Lavi or the Condor. Israel went through these steps BEFORE it could build the latest AWACS, improve Mirages for 21st century combat, or build a small and highly capable missile like the Barak.

    India, likewise, does not have the existential threat to solidify its population to a common cause. Israel started adapting trucks to bear military loads before it became a recognized state. TATA industries is starting to mount artillery on trucks for India 60 years after becoming a nation. India has had the same time, more resources and more opportunity to build systems from nothing...and it has not done so.

    From Israel's experiences, it has gained knowledge. India doesn't lack capability of engineers, it doesn't lack lacks the willingness to start from the bottom.

    India is making stealth frigates when it needs to make FACs and test technologies on needs to invest in building basic AShMs that can hit their target (and have adequate ECM protection) before building supersonic or hypersonic missiles that have neither. Yes, a giant, fast missile is impressive...but Israel learned with small, slow missiles.

    It's not that Israel is sabotaging Indian industry, it's that Israeli industry wants to survive. The only way it can (in a relatively poor country, flooded by 'free' American technology)is to sell to foreign countries...they don't sell at a financial loss, though they may make minimal profits, they sell to cover the base costs. They're selling to keep people employed and cover the overhead and materials. The knowledge of the technicians is's not about future markets in India, it's about future capabilities in Israel.

  48. Ajai,
    I think you may have treated DJ a bit harshly and without reason. Israel developed its own AWACS program before it sold it to anyone. It invested hundreds of millions of dollars to constantly upgrade the systems and used other national programs (like ballistic missile defenses) to develop the technology. There was a lot of Israeli investment in the radar technology, the specific platform is nearly irrelevant in comparison to the radar tech. India didn't pay for Israeli R&D, India bought a share of the on-going Israeli R&D. It may seem like a subtle difference, but it's significant (more on that later).

    As far as the systems installed in the Indian T-72s. The Israeli expertise is not based on the T-72s they captured in the 1980s, but rather in their experience with British, French, Russian and American tank models they operated before then. The experience of adapting these different technologies to their own uses and a determination to be technologically independent of other nations (after a mid-combat betrayal by France) allowed Israel to build the Merkava series of tanks. The Experience from the captured T-72s was not in copying Russian technology, but in improving Russian technology...and eventually replacing it entirely with Israeli systems as the native developments outstripped the core capabilities of the existing tech.

    Similarly, the experience with the MiG-21 and Mirage updates come from a desire to improve what they were given (or left with) in other aircraft models. These were not copied technologies, they were taking old tech (on fairly solid platforms) and making it better.

    Have Israeli companies been enriched by a lack of Indian commercial competition? Yes.

    Did funding go to Israel that could have otherwise supported local industries? Yes.

    Could local industries have produced equivalent products in equivalent time spans (at slightly more cost)? NO.

    Israel took 50 years to build up the experience and technology. It had very little to do with an influx of Russian Jews post-Cold War or stolen military technology or support from American arms manufacturers (who more often buy licenses to Israeli tech than the reverse). It was because of hard work, an educated population and a national sense of urgency. India lacks, primarily, the last of these.

    There was no brain drain from Israel when developing these technologies. Scientists and engineers were not forced to work on these projects (as in Iran) nor were they willing to leave their country (and their family and friends) to make more money at the risk of NOT developing something to improve their security.

    There are how many Indian citizens? How much territory is there left if China or Pakistan invade? How many hundreds of miles can be retreated before forces gather to lead a new assault? That's a lot of security.

    Look at Israel! Its entire population is less than half of that of Mumbai, there are NO more soldiers after a single infantryman. This is why almost the entire population is trained to fight. It is about 50 miles across at its WIDEST point, from the West Bank to the Coast is less than 10 miles at many points. There is NO room to retreat. There is NO time to collect forces if you lose one battle. This explains why its citizens "remain insecure, xenophobic and afflicted by a disturbing sense of victimhood."

    It's not a sense of insecurity, its insecurity realized. It's not xenophobia, it's a history of being told that they shouldn't exist in a nation ruled by others...and being denied one of their own (until recently). It's being LITERALLY surrounded by enemies. It's not a sense of victimhood, it is a history of it.


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