Millennium Post

Problems multiply for India’s growth story

Problems multiply for India’s growth story
There is something genuinely wrong with the way our nation’s affairs are being run. How else can one explain India’s emergence as the world’s largest annual defence importer, despite massive shortages in modern armament and equipment that beset its army, navy and air force. Why do India’s indigenous missile and satellite programmes have little linkages to its military capability? Why is India short of modern guns, trucks, war ships, aircraft carriers, nuclear submarines, fighters, bombers, critical signal equipment and electronic gadgets? 

Why does India’s annual defence import of less than $10 billion raise a critical national concern? Despite having a dismal per capita annual income of less than Rs 6,000, we officially import $70 billion worth of gold every year for personal consumption. Why does India often fail to book and punish terrorists? Why are certain political elements in India over-concerned about what the country’s prime minister communicates to overseas Indians, who support India’s economy with repatriation of over $70 billion a year? Why is India still struggling to grow, while China continues to surge ahead, despite recent setbacks? 

Such questions trouble ordinary Indians, both at home and abroad, especially when they know that their government failed to strike a 126 fighter aircraft deal with France’s Dassault Aviation SA for seven years between 2007 and 2014. The fact that India finds it tough to spend $12-14 billion per year to modernise its defence forces has not been lost on its well wishers. India spends over 20 per cent or more than $100 billion on luxury imports every year. India’s military has remained in the hands of foreign equipment suppliers since its independence as the nation’s first government trusted foreign suppliers agents more than potential local manufacturers. The tradition has continued for decades. Despite the deal to import 36 Rafale fighter jets directly from the French manufacturer, it will take almost two years for them to arrive. 

While Prime Minister Narendra Modi’s last concluded three-nation foreign trip covering France, Germany and Canada became an eye opener for these countries as well as others about the seriousness with which the government is dealing with India’s defence, strategic and economic concerns, a lot needs to be done to take the country forward on all these areas. Uranium imports from Canada are fine. However, will the government be able to implement pending nuclear projects? The unfortunate fact is that there is a massive political and NGO-led resistance to development in the country. Can the government lift the spirit of the people towards development? 

The resistance to the new land acquisition act is pretty depressing, despite the fact that India needs fast growth in both the industrial and infrastructure sector to create jobs for many unemployed youth in its rural and urban parts. Modern agriculture is less job-oriented. More rural youth from the hinterland are moving to towns and cities both in China and India for jobs. Industry must have land to ‘Make-in-India’ to ensure higher economic growth and jobs for the youth, after training them in various trades.

The Rafale deal with the French government, involving an outright purchase of 36 fighter aircraft ready-to-fly on operational exercise, is a good move. The Indian Air Force has waited for almost 15 years for new generation aircrafts. IAF had to make do mostly with Russian supplies. Many such aircrafts, especially MiG 21, are old. While the MiG 29, Sukhoi and other newer Russian aircrafts have come to the rescue of the IAF’s inadequate strength and limited operational versatility, the country badly needs to pruce up its airpower. 

India does face imminent threats in the face of an aggressive military equipment acquisition process by Pakistan and China’s growing prowess in the region. Until now, Russian supplies provided the key operational strength to the IAF.  Russia has also been the first to offer technology transfer to build the MiG aircraft in India. India, however, needs do more.  

Defence sources say that India urgently needs to conclude a host of defence purchase deals worth over $ 40 billion. These purchases have been pending for years. While insisting on its ‘Make-in-India’ programme, the new government is keen to ensure that urgent defence requirements are not further delayed or stalled by vested interest groups in military, bureaucracy and DRDO. The government wants transactions to go down smoothly and fast.  

Among the urgent defence requirements are six submarines worth $8 billion to be built in India, 440 helicopters worth $6.5 billion for all the three services to be mostly made in India, 56 transport aircraft costing around $3.2 billion for which a Tata-Airbus consortium made a bid and a assortment of anti-tank missiles, infantry fighting vehicles, armored personnel carriers and other crucial military hardware worth $1.1 billion. 

Almost 60 per cent of the Indian Army budget is spent on payroll. Indian Air Force is said to be operating at 75 per cent of sanctioned strength of combat squadrons. Indian Navy too has been hit by the delays in acquisition and technology upgradation as well as a series of accidents.  The defence ministry plans to spend $150 billion within the next 12 years to modernise India’s military and push domestic manufacturing involving both the private and public sectors. For all these processes to occur, the entrepreneurs will require land and infrastructure support. Is India ready to meet these challenges? 

The prime minister sought the support of both France and Germany to exploit India’s massive potential as a manufacturing hub. He also addressed NRIs in Germany and Canada, asking them to invest in India and undertake manufacturing activities in the country.  France and its nuclear power companies, AREVA and Alstom, are keen to settle issues concerning the Jaitapur nuclear power plant in Maharashtra. 

Are Shiv Sainiks ready to welcome the French nuclear plant at Jaitapur? Airbus has announced its decision to enhance outsourcing from India from 400 million Euros to two billion Euros over the next five years. French National Railways offered to co-finance a semi-high-speed (200Km per hour) project on Delhi-Chandigarh route. India is keen to be a modern country. However, all these can’t be achieved if political parties continue to present different agendas.  IPA
Nantoo Banerjee

Nantoo Banerjee

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