Britain changes strategy on selling arms to India

Defence minister’s trade mission pushes technology expertise rather than weapons

India is the world’s largest importer of weapons, but when Britain’s defence minister meets his counterparts in New Delhi this week he will not be lobbying for new military hardware deals.

Sir Michael Fallon is the latest in a series of ministers to visit India in recent weeks as the UK begins to think about its post-Brexit trade arrangements.

He began on Wednesday by addressing a conference in New Delhi before meeting senior members of Narendra Modi’s government.

But unlike previous visits, the UK is not pushing for any immediate arms sales.

Military experts say it is a sign of how the UK has been left behind. “If you look at the main four or five players in India, the UK is not there at this point in time,” said Rajeswari Rajagopalan, senior fellow at New Delhi’s Observer Research Foundation. “Russia, the US, Israel and France are all more significant in terms of weapons sales.”

India has dramatically increased its defence imports in the past decade, as it looks to re-equip all three of its armed services, which often lack modern and functional kit. 

In the four years between 2012 and 2016, India was the world’s number one importer of weapons, accounting for 13 per cent of the global total, according to the Stockholm International Peace Research Institute.

£34m

UK defence exports to India in 2015, down from £966m in 2010

Its foreign purchases during that period were 43 per cent higher than in the previous four years.

But as other countries have scrambled to seal billions of dollars of contracts, the value of UK defence exports to India has fallen sharply, from £966m in 2010 to just £34m in 2015 — though there was some success in 2014, with £487m worth of sales made.

The biggest blow came in 2012, when Eurofighter, the consortium that includes BAE Systems, lost out to France’s Dassault in the bid to win an €8bn order for fighter jets. That deal was finally signed last year.

Since then, BAE Systems has successfully sold 145 howitzer artillery guns to India for $737m, and is waiting to finalise the sale of another 20 Hawk trainer aircraft to the Indian air force, which already owns 123 of the aircraft.

Michael Fallon addresses a conference in New Delhi on Wednesday © AFP

While Sir Michael is likely to make the case once more for the Hawks, industry executives do not expect an imminent resolution.

Furthermore, they say ministerial lobbying is unlikely to do much to resolve deals such as this, which have been in the works for many months.

One UK official said: “The Indian army was created from the British army. We share a joint history, training methods and overall ethos. But when it comes to selling hardware, we have struggled, in part because we are not willing to do purely government-to-government deals like the Russians, Americans or the French.”

Instead of weapons, the UK is concentrating on selling expertise to the Indian armed forces, whether in computer systems, data handling or cyber security. 

“It is important that we work together to design and drive those technologies to use the best of India’s brain power with the expertise of our long-established defence companies,” Sir Michael said in New Delhi on Wednesday.

The UK is also hoping to help the Indian government redesign the way it handles procurement contracts in the future, having overhauled its own defence equipment and supply systems since 2010.

This last plan is one some Indians have questioned, pointing out that the UK has botched its own major procurement processes, such as the order for two aircraft carriers, currently seven years late and vastly over budget.

But UK ministers hope that if they sell their defence purchasing expertise, it might provide a way to increase actual weapons sales in the long term.

One British official said: “The Indians do not have equipment plans, and it is very hard to predict what they might be in the market for.

“But if we can get ourselves involved in those conversations behind closed doors with the Indian military, we might just be able to help them decide what they need, and make sure we can provide it.”

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