WEAPONS PRODUCTION AND PROCUREMENT

WEAPONS PRODUCTION AND PROCUREMENT All armed forces need to replace their aging weapons systems after they complete their life cycles. For India, the MiG-21 aircraft and T-59 tanks, and its sole aircraft carrier, need replacement. The problem of bloc obsolescence is acute in India because its major weapons systems, mainly ex-Soviet in origin, were procured in the 1960s and now require urgent replacement. Current generation weapons systems, incorporating the latest available technology, are naturally costlier than the equipment being replaced. The paucity of resources had inhibited long-term planning by the Indian defense establishment, leading to a "bunching" of expensive requirements. The MiG-21 variants, for example, were imported from the Soviet Union in the 1960s at around U.S.$500,000 apiece; the MiG-29 fighters were obtained in the mid-1980s for $14 million; and the Su-30 fighter bombers currently being inducted cost about $30 million each.

Difficult decisions consequently need to be made whether the successor weapons systems should be indigenously developed or procured from abroad, or whether aging equipment should be refurbished, if possible, to extend its service life. Inadequacy of funds inhibits ideal acquisition decisions. The refurbishment option is therefore becoming more viable for India as the costs of state-of-the art equipment rise astronomically.

Issues Involved

Weapons acquisition decisions in India are not simple. Political factors restrict the choice of external suppliers. The initial unavailability of Western arms, due to political factors, led to India's dependence on the Soviet bloc; currently some 70 percent of the major weapons systems in India's armed forces are of Soviet origin. The end of the cold war, however, has created a buyer's market. Arms supplier nations are vying with each other to sell any type of armaments for purely commercial considerations. But problems remain, as occurred when the United States and other Western nations imposed sanctions on India after its nuclear tests in May 1998. Not only did they withdraw from negotiations for supplying new equipment, but also from contractual obligations to supply spares and ancillaries and to undertake repairs to equipment already supplied. India had similar experiences in September 1965, during the second Indo-Pak War, when the United States stopped all supplies of military equipment to India.

Therefore, the achievement of a maximum degree of self-reliance and self-sufficiency has long been a hallowed goal of India's defense establishment. In furtherance of this objective, a decision was taken by the Government of India in the mid-1990s to launch a ten-year self-reliance plan, designed to raise defense expenditure on acquisitions from indigenous sources. A three-pronged approach, involving indigenization of vital spare parts, upgrading of existing systems by life-extension programs, and indigenous design and development of high-technology weapons systems, was launched.

The Indian Bureaucratic Process

A major problem in the Indian situation is that weapons equipment must perform in very different terrains over wide temperature variations, ranging from -22° Fahrenheit (-30° C) in the Himalayan heights to 122° Fahrenheit (50° C) in the Rajasthan Desert. A make or buy decision has then to be made after consulting Defence Research and Development to ascertain whether they can develop the weapons system within an acceptable time frame. Extensive debates take place to arrive at a pragmatic solution. If the decision taken is to produce the equipment indigenously, the defense laboratory is identified and tasked to develop a model, freeze the design, develop a prototype, and conduct user trials.

Should it be decided, however, to procure the equipment from abroad, suitable suppliers must be identified by a literature search; the military attachés serving abroad are also tasked to identify suitable suppliers. The actual selection of a particular weapons system involves two stages. A technical evaluation of the various systems is made by Services Headquarters. Later, the short-listed suppliers are requested to send in price quotations. The commercial terms for inducting the equipment are then placed before a Price Negotiation Committee, which enters into negotiations and ultimately signs the contract with the selected supplier. These contracts often incorporate clauses for the transfer of technology and the indigenous manufacture of the equipment.

The Department of Defence Production was set up in 1962, following the Sino-Indian border conflict. In 1965 the Department of Defence Supplies was created to forge closer links with the civil sector, in order to promote the indigenous production of imported defense stores and new stores required by units in the public sector. This department was merged into the Department of Defence Production in 1984 to form the Department of Defence Production and Supplies.

Defense production in the public sector is organized in forty ordnance factories and eight public sector undertakings, incorporated as limited companies under the law. In addition to the armed forces, these units cater to the needs of the paramilitary forces and the police. The ordnance factories are divided into five operating divisions: ammunition and explosives; weapons, vehicles, and equipment; materials and components; armored vehicles; and ordnance equipment. They also produce items for the civil market, like textiles, leather goods, and sporting arms and ammunition. An aggressive effort is being made to export their products. The eight defense public sector undertakings produce a wide variety of goods for the armed forces, including aircraft, electronic goods, heavy vehicles, naval vessels, missiles, and special alloys.

The Defence Research and Development Organisation (DRDO) was created in 1958 by amalgamating the existing technical development establishments in the services. The Department of Defence Research and Development, established in 1980 to enhance self-reliance in defense systems, now has forty-nine laboratories engaged in developing defense technologies and covering disciplines like aeronautics, armaments, electronics, combat vehicles, engineering systems, instrumentation, missiles, advanced computation and simulation, special materials, naval systems, life sciences, training, information systems, and agriculture. It employs over 5,000 scientists and around 25,000 other scientific, technical, and supporting personnel, making it the largest scientific establishment in India. Some of its notable achievements are development of the Lakshya pilotless target aircraft, the Nishant remotely piloted vehicle, airborne electronic warfare systems, the Agni-I land/rail mobile missile, and the PACE parallel processing super-computer. Its major projects under development include the Light Combat Aircraft and its Kaveri engine, the Trishul surface-to-air missile, different warheads for the Prithvi short-range missile, the BRAHMOS supersonic cruise missile, electronic warfare systems for the three services, and various types of sonars and battlefield surveillance radars. Several of the technologies developed by DRDO have civil applications, such as agricultural practices in high-altitude areas, malaria control, high-altitude medicine, nuclear medicine, and radio-pharmaceuticals.

A symbiotic linkage exists between the Defence Production and Supply Department and the DRDO; consequently, a weakness in one affects the other. The DRDO is headed by the scientific adviser to the defense minister, and the combination of advisory and line functions offends a basic principle of public administration. Quality control is also carried out in-house by the user services, which again offends a basic administrative principle that external checks are necessary to ensure integrity in any activity. How effective the newly constituted Defence Procurement Organisation will be to address these weaknesses remains to be seen. But the lack of accountability in the processes of indigenous research and development and defense production is worth highlighting, as it incorporates a single developer (DRDO), a single buyer (the armed forces) and a single funder (the government). There is regrettably no credible legislative oversight available over these activities. Parliamentary committees like the Public Accounts Committee, which undertakes examination of past procurement cases, or the Estimates Committee, which examines budget estimates, and the Standing Committee on Defence are unable to exercise any effective checks over defense acquisitions.

Role of Private Industry

A change in official Indian attitudes toward the private sector has occurred with the steady liberalization of the economy and the impact of globalization. Greater participation by Indian private industry is thus being sought, and such companies are now eligible to apply for licenses to manufacture a wide range of defense items and to seek foreign direct investment, to the extent of 26 percent of their business.

For indigenization of spares, a serious problem regarding all ex-Soviet equipment, the Department of Defence Production and Supplies has set up technical committees to identify the needs of the user services, take up indigenization activities, and ensure timely supply of defense equipment and stores. Sample rooms are also being maintained in metropolitan cities to familiarize the civil industry with the requirements of the armed forces. Civil industry clearly expects to play a larger role in future defense production.

Conclusions

India has been most fortunate, compared to other developing countries, in having internal stability and a democratic system of government that has taken deep roots; one of its manifestations is the firm control of the civilian leadership over the military apparatus. The civilian bureaucracy, however, is largely untutored in dealing with complex military issues, including defense acquisitions, research and development, and domestic production of weapons systems. The discovery of several major cases of corruption in the purchase of foreign weapons has led to great caution in the procurement process, which at times seems to be paralyzed. This has also resulted in the defense research and defense production establishments functioning below par and paying altogether too much attention to nuclear weapons and missile technology. Inadequate attention has been paid to the reform of the defense apparatus, despite a plethora of reports and sensible suggestions having been made to achieve this objective. Consequently the Indian weapons procurement and production processes are as yet performing less efficiently than they should.

P. R. Chari

See alsoBallistic and Cruise Missile Development ; Ballistic Missile Defenses ; Nuclear Programs and Policies ; Nuclear Weapons, Testing and Development .

BIBLIOGRAPHY

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——. Ministry of Defence, Annual Report, 2002–2003. New Delhi: GOI, 2003.

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Lok Sabha Secretariat. Ministry of Defence, Standing Committee on Defence. Demand for Grants, 1994–1995. Fourth Report. April 1995.

——. Defence Research and Development: Major Projects. Fifth Report. August 1995.

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