Just as Indian Navy reached the threshold of opening doors to private
sector participation in indigenous helicopter manufacturing, a series of
seemingly unconnected high-level interventions and policy announcements
have turned the spotlight back on the Indian Navy’s Naval Utility
Helicopter (NUH) project.
In a sudden turn of events nobody
foresaw, novel initiatives from the incumbent government came up against
the Novel Coronavirus-19 (Covid-19) pandemic. A global recession stares
us in the face. Shrunk defence budgets are a grim reality now for the
foreseeable future.
The Indian Chief of Defence Staff (CDS) Gen
Bipin Rawat was quoted saying “the Indian Armed Forces must not go in
for large amounts of imports by misrepresenting our operational
requirements”. Prime Minister Narendra Modi addressed India on May 12,
2020 on Covid-19 with a forceful plea to make India atma nirbhar or
self-reliant. Following PM Modi’s speech, Finance Minister Nirmala
Seetharaman unveiled a slew of ‘big-bang’ reforms, some of which will
shape the future of ‘Make in India’ for defence.
In policy matters, two-plus-two don’t always add up to four. Public
pronouncements at a high level can have intended and unintended
consequences. Recent news reports indicate that “companies have been
asked to explain if the (NUH) programme has export potential”. The
government may also consider giving defence PSU Hindustan Aeronautics
Limited (HAL) a chance to enter the NUH competition.
Whither Strategic Partnership?
The
Strategic Partnership (SP) model was introduced by Indian MoD as
Chapter VII in DPP 2016 based on recommendations put up by the Shri
Dhirendra Singh Expert Committee. The objective of SP was to create
capabilities in the private sector for manufacturing key defence
technologies. Military helicopters were identified as one of them. This
was in addition to the already well-established capabilities of DPSU and
Ordnance Factory Board (OFB). Capacity building, more players in the
market, wider choices, healthy competition, potential to make and export
– the possibilities are immense. The user (services), in turn, would
stand to reap rich harvests from the new paradigm.
Imagine USA or
Europe where aerospace & defence (A&D) majors like Lockheed
Martin, Boeing, Bell Flight, Leonardo, Northrop Grumman, etc. (with a
thriving ecosystem of smaller private sub-contractors) compete head to
head for every slice of the defence pie. Now look around Indian DPSUs
and OFBs. Organisationally, culturally and functionally, they resemble
relics from an era gone by. In the 21st Century, we still do not
manufacture here in India a helicopter (or modern fighter) that is
globally accepted or even considered fair competition.
SP’s First-born – Naval Utility Helicopter
IN’s Naval Utility
Helicopter (NUH) program became one of the first projects allotted to
SP. It’s not as if the navy is an ideal candidate for such experiments.
Quite the obverse, actually. The IN has barely enough helicopters to
retain self-respect. Yet, to its credit, IN took the lead; with hope
that the long-standing capability void left behind by HAL’s ALH Dhruv
would get filled. This also aligned with progressive government policy.
The
Department of Defence Production (DDP) that is responsible for all
DPSUs and OFBs recently questioned the very basis for allotting NUH
under SP. Through a series of letters drafted by their consultant early
this year, DDP argued that since HAL-designed ALH meets all naval
requirements, it should be the obvious choice for NUH under IDDM –
‘Indigenously Designed Developed and Manufactured’ category. In the
least, MoD should issue the NUH Request for Proposal (RfP) to HAL as
well, they contended. HAL has been quoted that they are “generally in
agreement” with the consultant’s views.
A system fine-tuned to reward DPSUs?
Whether
this is part of a larger canvas for self-reliance and nation-building,
or lobbying by HAL to get ‘foot in the door’ at a critical stage of the
NUH-SP program, we may never know. But it is neither unique nor
surprising. Not a single case for defence equipment moved by any service
can see the light of day without DDP and its cohorts drawing blood.
Many cases reach fruition through them, some despite them. Many flounder
due enforced U-turns the services had no way of countering except file
notings opaque to the world.
In this regard, naval aviation remains one of the biggest losers among
all three services. The IAF managed to induct many medium lift
helicopters, Apaches & Chinooks, even as they kept HAL’s order books
busy with the ALH. For the Indian Army that grew up on Cheetahs and
Chetaks, the ALH Mk III or Rudra is manna from heaven. They invested in
the ALH in a big way, learning many lessons along the way. In last two
decades, all that the navy has inducted in rotary wing are eight
shore-based ALH, six UH-3H resurrected from a boneyard in USA, and a
handful of AEW KM-31 bought from Russia.
Key decisions lined-up ahead
Recent
reports in media would have us believe that IN’s entire exercise of
building a case for NUH – starting from 2008 when the specifications
were first written – was to walk into the arms of foreign vendors or
flush foreign exchange down the drain. If such views are considered on
merit, it raises some interesting questions.
Firstly, why did the NUH
– a government-approved Strategic Partnership (SP) program under PM
Narendra Modi’s flagship ‘Make in India’ banner – ever get MoD approval
in the first place, that too for the navy which faces the most acute
shortfall in helicopters? Secondly, why did HAL wake up in the 21st
Century to offer the same product (Dhruv) that forced IN to look for
other options because it failed to meet their expectations in the last
century?
The naval scope creep that saw NUH specifications inflate from 4.5-tons
to 5-tons maximum takeoff weight (MTOW), thereby bringing it closer to
ALH (5.5-ton MTOW), drew more competitors, including HAL, into the fray.
Fear of losing out on a INR 21738 Cr deal ($3bn), missed opportunities,
and a lacklustre naval order book could be contributory factors for
intervention by HAL/DDP.
A time-tested strategy
This
strategy of waiting in the wings, using formal and informal access to
corridors of power, exploiting benevolence of policymakers, defending
critical gaps in quality or low productivity with futuristic promises,
toying around ad-infinitum with ‘children of monopoly’ that derail or
fall short of the services’ expectations, and then – at crucial decision
points such as this – jumping to throw a spanner into the works, this
is a time-tested, low-cost option often exercised by DPSUs and DRDO
laboratories.
In the absence of credible competition from the
private sector, this has spelt doom and run aground many projects the
three services formulated with great enthusiasm. Vested interests often
betray an elephantine yet selective memory that play-up, very
conveniently, only one side of the story. How soon we forget past pain
and expensive lessons!
Customer is king or customer is kind?
India
would not be one of the world’s largest importer of arms if the DPSUs
and OFBs were a hallmark of efficiency. Unlike shipbuilding, where many
shipyards and PSUs compete with each other, in aerospace, HAL wields
complete monopoly in India.
To be sure, the ALH is yet to meet its own 35 year-old naval staff
qualitative requirements (NSQRs) in key areas such as range and
endurance, blade folding, stowed dimensions, aircraft availability and
serviceability. These are non-negotiable specifications for helicopters
that operate for extended duration at sea. The navy did not stumble upon
this non-compliance yesterday or in last Aero India air show. This has
been the case from the time the Dhruv first took to sea. Even today, the
naval ALH is not a platform of choice for a naval warship proceeding
out of harbour.
The navy’s 2-decade indulgence with naval Dhruv
has left it with a product whose manufacturer claims today that a new
blade fold solution will be fielded soon. This after three decades of
dealing with NSQRs. What couldn’t be achieved over 30 years is now
proposed to be made ready in months. A segmented-blade proposal flying
on the Light Utility Helicopter (LUH) and a mock-up of tail boom folding
showcased during Aero India 2019 are the latest offerings. None of this
has been flight tested or proven on the machine. If mock-ups and
promises could fly, we would’ve had a fleet of Dhruvs occupying empty
decks and cavernous hangars on every other IN warship’s deck.
A grim caution
Looking through this chimera, I feel, we may be about to repeat old mistakes.
Firstly,
all promises and timelines quoted by DPSUs must be treated with deep
circumspection. This is a system plagued with “caveat emptor” or “buyers
beware”, a nebulous sense of purpose, and no meaningful competition.
Nobody is accountable to draw tough red lines or admit ‘it cannot be
done’. It is just not there in our system. Services and HAL are equally
complicit in this incest.
With the benefit of hindsight, even a layman could have predicted in
early 90s that the NSQRs would be compromised in favour of IAF and army
specs (and numbers) that drove the ALH program. But dissenting voices
were either ignored or simply outrun with the sheer staying power of a
government entity.
Such an outlook eventually breeds a complacent attitude, poor quality
products and compromises on essential requirements. This takes nothing
away from the capability of our workers, scientists, engineers or test
crew. It is just the way any system would work in the total absence of
competition. The SP model was meant to take this down by levelling the
field for private industry.
Aircraft availability is a key metric
for the navy where ALH has failed to impress. Low aircraft availability
translates to higher maintenance reserve and high ground time a
seagoing force can ill-afford. HAL’s repeated efforts to sell ALH to
civil operators bears testimony to its commercial viability. To date,
all exports of the ALH have been unsuccessful.
Realistic costing
Any
arguments on the lines of ‘ALH is the cheaper option’ should be weighed
against cost of product development and testing. If all the naval
manhours, ships, submarines and consorts, opportunity costs, grounded
helicopters, capability gaps because of undelivered promises,
operational logistics, etc. are accounted & costed for, an alarming
figure will emerge. This is true for products from most DRDO
laboratories and DPSUs.
For example, costs associated with
testing sensors for hundreds of hours, with consort ships (120+
uniformed souls onboard) standing by, shore bases activated, submarines
deployed for months – all this must be factored against projected lower
costs of products from the DPSU stable.
Any arguments on saving foreign exchange by buying local should also
take into account realistic estimate of indigenisation achieved on the
ALH. Then again, selling these machines to a local, captive audience
simply circulates money within different government departments. Why not
set the bar higher, make local and export globally, thereby drawing
foreign exchange into government coffers?
Redefining indigenisation from a public-private perspective
Indigenisation
needs to be redefined from a private-public, collaborative, win-win
perspective. It doesn’t have to mean everything made in India. An
aeroplane or aero-engine is more than the sum of its parts. Today, we
have a unique chance to walk the talk’ by engaging with private sector
in defence by placing orders, not sloganeering.
It is 2020. The
IN still doesn’t have an indigenous helicopter with seamless interface
across all decks – one that sets a benchmark for navies worldwide. We
have the unique opportunity today to infuse fresh blood into a languid
system by tapping private sector resources. At this crucial juncture, IN
must stay the course and the MoD must give private players a fair
chance. HAL had more than their say and opportunities for over three
decades. That did not get IN the capability it needs as of yesterday. To
me, this displays indifference and lack of understanding on what
actually constitutes a world-class naval helicopter.
Conclusion
The IN needs real capability; one that brooks no
concessions. We need helicopters that can remain at sea without cringing
or making the crew cringe; without having to break parts; without
having to burn holes into hangar bulkheads. To HAL’s credit, it still
has order books brimming with ALH & its derivatives, a fair chance
with the Ka-226T offered through Indo-Russian Helicopters Ltd (a JV of
HAL & Russian Helicopters) and also the prospect of supporting
strategic partners and MSMEs by becoming a Tier-2 supplier under the
NUH-SP program. Then there is the Indian MRH / Naval MRH. I see a
win-win situation for all sides, including HAL, if we are able to make
SP model work and create synergies to manufacture world-class
helicopters, not only for India but for the world.
If there is anything HAL needs most today, it is competition, not orders on a platter.
Inducting
machines in the 21st Century that give a net endurance of 30 minutes
with dunking sonar and lightweight torpedo proves only one thing – we
learnt NOTHING from the naval ALH experience.
The MoD must take
some tough decisions. Naval requirements are unique and demand a product
designed from the sea level up. Through private industry participation
in defence manufacturing we must aim to achieve parity with countries
like USA and China, even Japan, that have harnessed the power of
collaboration with clearly defined (& delivered) outcomes.
The
ALH is a wonderful machine. Indian Navy’s two decade ‘social
distancing’ from this helicopter was not out of any bias, but out of
fundamental incompatibilities. The lessons from this experience must
shape our decisions for the future.
HAL can be a friend,
philosopher and guide to the nascent Indian rotary industry. The rising
tide of “atma nirbharta (self-reliance) must lift all boats.
TOI
