August 13, 2014

US overtakes all to become India's largest defence supplier

Stunning new figures on Indian defence imports by Defence Minister Arun Jaitley in Parliament on Tuesday have revealed that for the first time, the United States has overtaken all competitors to become India's largest defence supplier in the past three financial years.The statistics revealed by Jaitley, who holds dual charge of defence and finance ministries, show that almost 40 per cent of the money spent by India on defence imports in the past three years have gone to the Americans, followed by the Russians (30 per cent) and the French (14 per cent).
Israel is a distant fourth with merely 4 per cent share.This reversal - in the past Russia and Israel have remained India's largest suppliers of weaponry - has come on the back of several mega deals struck by the previous UPA government with US companies in the past three years, primarily using the Foreign Military Sales (FMS) or government-to-government sales route.In terms of actual numbers that have been shared by Jaitley in Rajya Sabha, out of the Rs.83,458 crore spent on defence imports, the US has got Rs.32,615 crore followed by Russia at Rs.25,363 crore.
France has managed Rs.12,046 crore while Israel - burdened by blacklisting of several companies on corruption allegations - is at Rs.3,389 crore.The dismal numbers achieved by Israel, which had risen as one of India's primary suppliers during the NDA regime, are mostly due to a glut in procurement that hit hard with the banning of IMI and the cancellation of a contract to set up an ammunitions factory in Raebareli in UP. The ban on purchasing of Barak missiles has only been recently lifted.The US' rise to the number one position is after a series of deals inked mostly in the aviation sector.
The largest has been the deal for C 17 transporters at $4.7 billion followed by a contract for P 8I maritime reconnaissance aircraft and additional orders for C 130 J special operations aircraft.The Russians have remained steady suppliers despite coming down to number two and have been getting major payments for T 90 tanks, Su 30 MKI fighters as well as a host of other smaller contracts.The French imports have primarily been to upgrade the Mirage fighter fleet for over $2 billion and continued payments for the Scorpene submarines.


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