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December 17, 2014

India, Russia Take Small Steps on Fighter Deal

India and Russia have agreed to settle their differences over the Fifth Generation Fighter Aircraft (FGFA) program, which the countries are co-producing. But a source in the Indian Defence Ministry said irritants remain following the summit-level talks here Dec. 11.

The issue came up during Indian Prime Minister Narendra Modi’s meeting with Russian President Vladimir Putin, the source said, adding that a final agreement will likely emerge in the “near future.” During the summit talks, Putin offered light utility helicopters to be manufactured in India, the MoD official added.

“I am pleased that Russia has offered to fully manufacture in India one of its most advanced helicopters,” Modi said in an official statement. “It includes the possibility of exports from India. It can be used for both military and civilian use. We will follow up on this quickly.”

The MoD source said the Russians have offered to manufacture in India the Ka-226, a small twin-engine helicopter, designed by Kamov. India has an immediate requirement of 440 light utility helicopters needed to replace the aging Cheetah and Chetak helicopters.

In August, the Modi government canceled the 2008 global tender for purchase of 197 light utility helicopters and decided to build these helicopters in India.

On FGFA, the MoD source said that in addition to the unsettled issue of work share in production of the aircraft, the Russians have talked of an increase in cost of developing and producing the aircraft, adding further to the stalemate.

While an initial agreement to jointly produce the FGFA was signed in 2010, the final agreement, which will help release $5.5 billion as India’s share toward the development of the FGFA, awaits signing. India wants a larger work share in the production of the aircraft.

“While India is investing 50 percent of the cost of the multi-billion-dollar program, its work share in the research and development and other aspects of the program has come down to around 18 percent, something which Indian officials are not happy about. Moscow will have to alleviate New Delhi’s concerns and discomfort over the work share,” said Indrani Talukdar, research fellow at the Indian Council of World Affairs.

A Russian diplomat, however, said Moscow has agreed to increase India’s work share from 18 to 25 percent, and even up to 40 to 50 percent in the near future, in view of the steady development of the Indian aviation industry.

“The inking of big ticket weapons projects during Indo-Russian summits in the past is now replaced with joint statements and promises which shows that defense ties between India and Russia have come to a plateau,” said defense analyst Nitin Mehta.

A joint statement issued at the end of the summit talks did not refer to any futuristic defense projects by name.

“Defense cooperation between India and Russia is founded on deep mutual trust and promotes wider peace and security,” the statement said. “The two countries have already moved to a phase of joint design and development of defense systems. The sides recognize the virtually unlimited opportunities for enhancing this cooperation, increasingly based on joint research and development, joint manufacturing, technology sharing and collaborative research in futuristic technologies, in accordance with existing agreements on military-technical cooperation.”

While the US, Israel and Europe have competed with Russia in the past decade to tap the $100 billion weapons market here, Russia has signed major joint development defense projects with India.

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