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December 7, 2004

India-Russia Alliance Turns Commercial


by Ranjit Devraj

NEW DELHI - The fact that Russian President Vladimir Putin equally divided his three-day visit to India, that ended Sunday, between political and business leaders speaks much for the changing nature of what was once regarded as a definitively strategic alliance of the cold war era.

That the military part of the alliance is largely intact can be gauged from the fact that a highlight of Putin's visit was the inauguration of a spanking new facility in the capital's cantonment area that will produce the joint-venture supersonic BrahMos missile, which has a 300 km (186 mi.) range.

"BrahMos is named after the Brahmaputra River in India and the Moskva River in Russia," a defense official said, explaining the strange label on the glittering missiles on display that suggested the same sentimental symbolism that marked the old Indo-Soviet relationship was still alive.

But unlike the past, collaboration between New Delhi and Moscow in the production of high-tech military hardware has now begun to take on a distinct commercial edge.

"The missile is claimed to be superior to the U.S. Tomahawk missile, but the focus is still on business," Madhavan Palat, a specialist on the countries that constituted the former Soviet Union and the Eastern bloc, told IPS in an interview.

Both India and Russia will be inducting the BrahMos missile into their armed forces in 2005, and there is already a long line of at least 10 countries waiting to add the missile to their arsenals.

BrahMos Aerospace was set up with a startup capital of $250 million, with both India and Russia sharing the costs equally.

Palat also pointed to India's launch of Russia's indigenously produced Sukhoi-30 multi-role fighter just a week ahead of Putin's visit as a sign of continuing military collaboration in the years to come, although New Delhi has for some years now been sourcing hardware from the U.S. and even Israel.

"We are no longer in the cold war age when India and the U.S. were moving in opposite directions," said Palat, who is professor of international relations at the Jawaharlal Nehru University.

One of Putin's team members was busy sorting out issues like timely deliveries of spares and weapons systems and an intellectual property rights (IPR) regime to prevent "leakage" of BrahMos technology to third parties. This was in line with the changing nature of secure bilateral relations into one that is commercially oriented.

Indian Prime Minister Manmohan Singh said he expected the IPR issue to be resolved by April next year. "The IPR rights will be respected in all future supplies of equipment," he said.

But India wants Russia to give strong commitments on maintenance of delivery schedules of contracted weapon systems, uninterrupted supply of spares and life-term product support.

Huge multi-million contracts signed with Russia in recent years like the ones for the Sukhoi-30MKI fighters, the T-90S main battle tanks, and the Talwar class stealth frigates, for instance, have been dogged by several delays. India wants stiff penalty clauses to be inserted in all such weapon procurement contracts.

Speaking to reporters, Russia's defense minister Sergei Borisovich Ivanov said what Russia was seeking was a "new strategic partnership with India that would allow the transfer of frontline technology that would go beyond a buyer-seller relationship."

Strategic analyst Jasjit Singh said the new deal would help India move on from the licensed production of Russian equipment like the Sukhoi-30 fighters and T-90 tanks to joint projects that include design and development, joint manufacture, sale, and product support – in a deal similar to the BrahMos missile.

"Global geo-strategic imperatives and historical realities indicate there is no issue of potential disagreement, leave alone tension between the two countries," said Singh, a former director of the prestigious think tank, the Institute of Defense Studies and Analyses (IDSA).

And neither Palat nor Singh thought the new contours of the Indo-Russian friendship were antagonistic to the relations the two countries have with the United States or with China.

"Both India and Russia are seeking closer relations with the U.S., the sole superpower , on one side and China, the rising power, on the other," Singh said.

Palat described talk of an axis building up among India, China, and Russia as a "trilateral middle-level strategic effort which can collaborate in such areas as the building up a common position on the Central Asian states, anti-terrorism, narcotics, and nuclear-proliferation."

China, India, and Russia already have in place a consultative troika, consisting of their foreign ministers, with regular annual meetings to exchange views of common concern.

"Any idea that this is a ganging up against the U.S. is just a fantasy of some lobbies," Palat said.

But the big story of the Putin visit was still hard business especially in such areas as petroleum and information technology.

India has already has made investments worth $1.7 billion in the Sakhalin-1 oil project and is looking to increase business opportunities in partnership with the Russian oil major Lukoil, which in the long term could improve the country's energy security.

Putin rounded off his visit with a two-day trip to India's IT capital of Bangalore in southern India where he spoke of the need for "broader objectives" in the relationship and one which could incorporate areas such as software, biotechnology and pharmaceuticals – sectors where private entrepreneurship in India has built up a formidable reputation in the post-cold war phase.

Such developments have augured well for India and Indian software companies are major earners of hard currencies from the West – leaving Russia and other members of the former Soviet empire completely out in the cold.

This competition for hard currencies is a far cry from the cold war days when India and the Soviet Union had the "rupee-ruble trade mechanism" which allowed New Delhi and Moscow to circumvent using the U.S. dollar for military purchases, petroleum, and other essentials.

"We cannot be satisfied with the present volume of trade running at $2 billion dollars and one dominated by raw materials and commodities," Putin said at a meeting organized by India's leading business chambers in Bangalore.

The Russian leader was probably reminiscing about the days when the former Soviet Union was India's biggest business partner.

 

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