Friday, February 25, 2011

The Big Deal nears the finish

Asked about China’s latest wonder, a stealth fighter called the J-20 that the US alleges was built by ‘stealth’ practices, Air Chief P.V. Naik shot back recently, “Is reverse engineering ethical or is it an illegitimate entry through the backdoor?”

It was an unusual outburst of helplessness for a military man who, more than anyone else, knows well that it does not matter how a country obtains its military capability, but only that it possesses it. As Deng Xiaoping once said, “It does not matter whether the cat is white or black so long as it catches mice”.

Air Chief Naik’s frustration was perhaps more at the fact that India is still some way from getting a fully capable Tejas LCA, let alone dream of a fifth-gen fighter. Perhaps the one area in which the Indian military still enjoys a lead over the Chinese military — air combat — is in danger of slipping, unless India acts quickly to refurbish its capability.

China, after all, is pouring billions into acquiring modern air superiority and multi-role fighters such as the Su-27 variants and the Su-30 MKK from Russia, building its own J-10 and JF-17 fighters in the hundreds and, worst of all, arming Pakistan too with them. Pakistan is beefing up its own F-16 fleet with new aircraft and, for the first time, American beyond visual range (BVR) missiles — the benefits of running with the hares and hunting with the hounds in the war on terror.

Meanwhile, suffering from collective obsolescence and a great many MiG aircraft crashes, the IAF’s strength is depleting. In the wake of the 1962 humiliation at China’s hands, it was estimated that the IAF would need to have 64 fighter squadrons. By the 1990s, though, squadron strength had peaked at about 42 and had begun to fall. Today, the IAF is left with anywhere between 29 to 34 squadrons, against a sanctioned 39.5. The IAF desperately wants to touch 45 squadrons by 2020.

The importance of the 126 medium multi-role combat aircraft (MMRCA) — which, per the armed forces’ Long Term Integrated Perspective Plan will go up all the way up to 260 fighters — cannot be overstated.

It's a big deal — in fact, the biggest defence import deal for India so far, and the biggest contract up for grabs for the world’s military equipment giants. It’s also the most complicated military buy decision that the IAF and the political leadership face. For starters, just the technical and field evaluations had over 600 test points for each aircraft. Yet, if a decision is not made in the next few months, it could be a very big disaster for the IAF’s short to medium-term warfare capability.

To be sure, the MMRCA procurement process has reached an advanced stage. The IAF has given the ministry of defence its report on the technical and field trials of the six aircraft in contention, reportedly without picking a favourite or even a shortlist — Lockheed Martin’s F-16IN, Boeing’s F/A-18 E/F, the Eurofighter (UK-Germany-Italy-Spain) Typhoon, the French Dassault Rafale, the Swedish Gripen IN and the Russian MiG-35 are vying for the contract — leaving that task to the MoD bureaucracy.

An MoD Technical Oversight Committee is currently looking at the ‘offset’proposals — a requirement that the winning contractor source a certain amount of the value of each aircraft that India buys from Indian industry — submitted by the contenders for the deal. Simultaneously, their proposals for transfer of technology, critical for the rapid development of an Indian capability to build advanced fighters, are also being examined.

At the end of this process — expected to end in a week or two — the TOC will ‘down-select’ a few companies to go to the next stage of the bidding process. The price bids of the short-listed companies will then be opened in front of the bidders. The lowest price bidder, designated L1, will be called by a Contract Negotiation Committee to finalise the terms of the deal. Once that’s done, the defence minister, then the finance minister and finally the Cabinet committee on security will have to sign off on the contract.

At the recent Aero India show, ACM Naik said this will be done by September, but MoD officials have told this newspaper it will happen no sooner than the end of the year or early next year, if all goes well. That caveat is important.

Corruption has always been the big bugbear, but the MMRCA process has, so far, been admirably unaffected. The IAF and the MoD have, in fact, gone out of the way to ensure that the process is clean and transparent.

Trouble, however, could come from elsewhere. For one, as the air chief himself said, a losing contender could put a spoke in the wheel — such corporate sniping has forced the MoD to re-tender or even cancel procurements in the past. Or, the finance ministry could well play spoilsport, as it did with the refueling tanker deal recently.

No matter who puts the spoke in the wheel, ultimately it is the country’s security that will be put at risk unless the IAF can begin to induct the aircraft by 2015-2016. Beyond that date, the MMRCA will either have to be scrapped or the aircraft will become a costly, even unnecessary, acquisition.

Nonetheless, it’s not an easy decision to make. For starters, should India buy an aircraft to meet merely IAF's capability requirements or, when it is spending over $10 billion — potentially $25 billion — should its choice be based on obtaining critical technology and strategic benefits? Even if only the IAF's capability requirements were kept in mind, should it go for a ‘combat-proven’ fighter essentially of 1970s/80s design (f-16), but whose development potential is at an end? Or, should it go for the newest, albeit relatively unproven, fighter that has ‘potential’ for improvement for the next 40 years (Typhoon, Rafale)?

Should the IAF insist on a fighter that has a working active electronically scanned array (AESA) radar today (F-16, F/A-18) or should it take the risk of choosing one for which an AESA radar is still under development?

Should the IAF simply go for the cheapest aircraft, while keeping its resources for a future acquisition of a so-called 5th-gen fighter, the F-35? Should it scrap the MMRCA, forget the F-35 and simply buy more of the most capable fighter it already has — the Sukhoi-30 MKI? Or should it buy the most expensive, but also apparently the most capable aircraft in the race — the Typhoon — to hedge against a possible failure of its own future aircraft project?

And what should India’s political leadership look to gain from such a big contract?
In March 2005, America declared its intention to “facilitate India’s defence transformation” by not only selling fighters but also “transformative systems” that would “help India become a major world power in the 21st Century”. Should India take the promise at face value and buy an American fighter, to possibly build an alliance against China?

Or, should India buy the Eurofighter Typhoon, and give the European defence industry a fillip in an attempt to preserve our preferred multi-polar world order? Should we buy the French Rafale because France, like India, likes to keep its independent flag flying and is ready to give us “100 per cent” technology?

In the end, it is very likely that even within the tight two-stage bidding process, India’s bureaucracy and political leadership will find creative ways to ensure that political and strategic considerations and India’s need for technology decide the final choice of aircraft.

F/A-18E/F Super Hornet
Company: Boeing
* Proven aircraft with potential for future development. Meets AESA radar requirement.
* India has chosen the GE F-414 engine for Tejas Mk 2. F-18 will mean a common engine for the two aircraft, a maintenance and support advantage.
* Is expected to come in at less than $70 million a unit.
* Excellent, but all-American weapons package.

Company: Dassault
* The darkhorse in the race is now apparently among the top choices.
* Comparable to the Eurofighter in most respects, and better than the F-18 in many.
* French air force has recently cleared the AESA radar to go on the fighter.
* French President Nicolas Sarkozy has apparently promised 100 per cent technology transfer.

Eurofighter Typhoon
Company: Eurofighter GmbH
* Apparently the most capable aircraft in the competition on a number of parameters.
* The ‘youngest’ aircraft in the competition, with potential for future development.
* Does not have a working AESA radar on the aircraft as on today. But one is under development.
* Biggest attraction: Eurofighter countries demand no agreements; won’t impinge on Indian sovereignty.

F-16IN Super Viper
Company: Lockheed Martin
* Perhaps the most-proven and combat-optimised fighter among the contenders, it has AESA radar, a key IAF requirement.
* Is expected to come at $60 million a unit.
* Has been offered with removable Conformal Fuel Tanks. Among the most manouvreable air-to-air fighters without CFT.
* Excellent, but has an all-American weapons.

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