Defence aerospace may not fully fulfil government’s Atmanirbhar Bharat initiative in the near future
Gp Capt. AK Sachdev (retd)
Irony, the contrast between expectation and reality, aptly describes the situation of our largely inefficient Public Sector Undertakings (PSUs). They were conceived as instruments to reduce dependence on foreign products, but over the years they grew into behemoths that did little to make India self reliant. With government patronage and fond neglect, their internal inefficiencies grew while the step-motherly treatment to private enterprise stunted growth in that sphere. Narendra Modi’s coming to power changed the thinking with his launching ‘Make in India’ as a national slogan in September 2014 and putting all his weight behind it.
Defence and aerospace are salient components of that programme; indeed, Modi pushed ‘Make in India’ by making it the theme of the 2015 Aero India Show and even inaugurating the show personally. Nonetheless, ‘Make in India’, while becoming increasingly audible in and out of context, does not have much to show in terms of actual statistics and achievements. A new slogan, ‘Atmanirbhar Bharat Abhiyan’, was invented in May 2020 in the context of a Covid-19 related economic package; it relied on bringing economic stimulus to a stifled nation. Six years after Modi used ‘Make in India’ at Aero India Show 2015, he used ‘Atmanirbhar’ as the theme for the Show’s 2021 edition.
Just before the Show took off, Modi tweeted, “India offers unlimited potential in defence and aerospace. Aero India is a wonderful platform for collaborations in these areas. The government of India has brought futuristic reforms in these sectors, which will add impetus to our quest to become ‘Atmanirbhar’.” The defence minister, Rajnath Singh, in another tweet, labelled the Show as a ‘Runway to a Billion Opportunities’; this phrase was emblazoned on the Show brochures as well. Indeed, ‘Atmanirbhar’ was the underlying theme for this edition of the Show with an Atmanirbhar Formation Flight, all aircraft made in India (under license production or else) on static and aerial displays, extensive floor space in the exhibition halls occupied by Indian entities bellowing the ‘Atmanirbhar’ refrain, almost every foreign participant in the Show tripping over the other to display his stout allegiance to ‘Atmanirbhar’, and even the logo of the Show being inspired by Tejas, the indigenous Light Combat Aircraft (LCA) produced in India. This article tries to contextualise ‘Atmanirbhar’ in defence aerospace through the Aero India Show prism.
The Atmanirbhar Show
The Show had 602 participating entities of all hues and sizes; of these 524 were Indian. The inaugural function underlined the ‘Atmanirbhar’ theme with the contract for 83 Tejas aircraft being handed over by Rajkumar, Secretary of Defence Production, to R. Madhavan, the Chairman and Managing Director (CMD) of Hindustan Aeronautics Limited (HAL). In January the Cabinet Committee on Security (CCS) under Modi’s chairmanship had approved procurement of 73 LCA Tejas Mk-1A fighter aircrafts and 10 LCA Tejas Mk-1 Trainer aircrafts at a cost of Rs 45,696 crore along with design and development and infrastructure sanctions worth Rs 1,202 crore on 13 January 2021. Appropriate noises were made about its magnitude making it the largest ever defence contract for an indigenous manufacturer.
The defence minister, who inaugurated the Show, announced plans to invest an equivalent of USD 130 billion over the next seven-eight years for military modernisation. He called upon foreign investors to tie up with Indian firms to set up shop in India for the world market, adding that the goal is to achieve a turnover of Rs 1,75,000 crore turnover in aerospace and defence production by 2024 with export being an additional focus. A flying display during the inauguration also included the Tejas and the Surya Kiran and Sarang air display teams with the accompanying commentary injecting the ‘Atmanirbhar’ mantra generously.
The ‘Atmanirbhar’ scheme permeated subtly through other events on the inaugural day. The defence minister released the Export Compendium of Defence Research and Development Organisation (DRDO); the document details defence systems and platforms which can be exported to friendly countries. Also released by the certification agency Centre for Military Airworthiness & Certification (CEMILAC) was a major revision of Design, Development & Production of Military Airborne Stores (DDPMAS) which is followed by the aeronautics fraternity for design, development, production and certification of airborne systems. The new airworthiness framework emphasises on the ‘Atmanirbhar’ sentiment, empowering the organisations and industries with liberal certification procedures.
Commemorating the golden jubilee of the Aeronautical Research & Development Board (AR&DB), the defence minister released a stamp and a book on the journey of AR&DB’s contributions to the field of aeronautics. The book highlights major achievements of AR&DB since its formation in 1971 to promote research and take India towards self-reliance in aeronautics. The defence minister also released publication entitled ‘Radiance in Skies–The Tejas Saga’ during the function; published by Defence Scientific Information & Documentation Centre (DESIDOC), a division of DRDO, it is a coffee table book authored by Air Marshal P Rajkumar (retd) and B.R. Srikanth and narrating the Tejas saga.
‘Atmanirbhar’ remained the quintessential strand running through the whole Show with 524 Indian exhibitors, as mentioned earlier; HAL and DRDO were larger than life as exhibitors. Space does not permit mention of each Indian entity present at the Show but details can be readily looked up at https://aeroindia.gov.in/Home/exhibitorlist.
Beyond The Show
‘Atmanirbhar Bharat Abhiyan’ is essentially founded on ‘Make In India’ and enumerates five pillars: economy, infrastructure, system, vibrant demography and demand. However, the Rs 20 lakh crore package mentioned by Prime Minister Modi as the stimulus for ‘Atmanirbhar’ turned out, in effect, to be only about a tenth of that figure in real terms and there may not be much on the ground to stimulate growth in defence and aerospace. The first pillar of ‘Atmanirbhar’ is economy and, largely due to Covid-19, at the moment the economy is at a nadir, although a general air of optimism abounds amongst government and analyst iterations about how it is about to take off. Certainly, at the time of writing this, the sentiment in Dalal Street appears to be convinced of an impending economical upturn. Nonetheless, the defence budget allocations are not very reassuring on the government’s capability to invest heavily in ‘Atmanirbhar’. Here it is pertinent to point out that defence (and especially defence aerospace) are capital intensive sectors and our investment into aerospace has so far not borne great fruit.
Much was made of the Tejas during the inaugural event and the rest of the Show, but as far as ‘Atmanirbhar’ goes, more than half of the Tejas Mk1A’s components are still imported; significantly, this includes the GE engine from the US and Elta Radar from Israel. That is not to say that Indian industry has made no contribution to the Tejas but just to highlight that critical technologies like the power plant are still some distance from us. Moreover, the last of the 83 Tejas ordered now will be delivered in 2030 by which time the technologies in it would be a decade older than they already are.
HAL has been around since 1940 when it was formed as Hindustan Aircraft Limited; it did produce a combat aircraft (HF 24 Marut) but failed to develop further technological expertise and was content to license produce aircraft thereafter. Its second aircraft, the Tejas, is still not combatworthy after almost four decades of development. Meanwhile, the IAF’s combat aircraft strength has dwindled down to 30 against a sanctioned strength of 42; to come up to that figure and taking into account ongoing attrition/obsolescence, the IAF needs about 450 combat aircraft over the next three decades. Currently, that figure is roughly toted from 38 Rafales under order, 114 Multi Role Fighter Aircraft (MRFAs), 100 Advanced Medium Combat Aircraft (AMCAs) and around 200 of Tejas variants. The IAF has 40 Tejas on order and another contract for 83 was signed during the Aero India Show. The Tejas is yet to be operationalised while the AMCA is yet to fly (although the IAF has given a green signal to it, possibly under pressure). These two are our indigenous combat aircraft hopes with HAL being the only industrial complex large enough to handle the Tejas, AMCA, MRFA and any future orders of Rafales. However, its chronicled history has not been very encouraging and HAL’s may not be an unadulterated ‘Atmanirbhar’ success story.
Besides combat aircraft, the IAF has decided to do away with the option to buy 40 more Hawk and 38 more PC-7 trainers due to financial pressures and has decided to procure 106 HTT-40 basic trainers developed by HAL (although the aircraft is yet to successfully complete spin trials, an essential criteria for trainer aircraft). An RFP was issued to HAL on the second day of the Show for 70 trainers with an option for 36 more. As an aside, the aircraft will be powered, like the Tejas, by a foreign engine (Honeywell turbo-prop engine TPE-331-12B). While the RFP may score a point for ‘Atmanirbhar’, as far as the IAF’s training infrastructure is concerned, it is a retrograde step as the HTT-40 is nowhere near the PC-7 as a trainer. Moreover, the delivery schedule, given HSL’s past history, is unlikely to be a cause for delight to the IAF.
The replacement for the IAF’s HS-748 Avro is the C-295, to be produced jointly by Airbus and Tata in India; a total of 56 are planned and the deal is under process at the acquisition department of the ministry of defence (MoD). Once commissioned, this would be the first tangible ‘Make in India’ programme in aerospace manufacturing by a private player with Airbus installing manufacturing capabilities, the final assembly line and testing capabilities in India. HAL is also the production agency for the NAL designed SARAS Mk 2 transport aircraft as and when it goes into production; the IAF is ready to buy 15 of these. Also of interest is the report that Tata may manufacture the Grob G180 SPn business jet in India for military applications like border surveillance and intelligence. It would be the first time a private company could make a full grade military aircraft in India.
The IAF is also processing a case for procuring the HAL Light Utility Helicopter (LUH). India and Russia had entered into an inter-governmental agreement to manufacture 200 Kamov-226T light-utility helicopters in India in December 2015; the deal is reportedly stuck in the technical evaluation stage over the ‘low level of indigenisation’ being offered by Russia. Again, the production is to be undertaken by HAL in a brand new project near Tumkur. A vital programme to develop next-generation airborne warning and control systems (AWACS) that will act as a major force multiplier for the IAF was cleared in 2015 for an estimated Rs 5,200 crore but orders have not yet been placed for the platform. Airbus is still trying to sell the A330 MRTT (a multi role tanker and transport aircraft) to the IAF. A possible lease arrangement may put paid to any ‘Atmanirbhar’ aspect to the AWACS programme.
In the field of UAVs, DRDO organisations such as the Aeronautical Development Establishment (ADE), the National Aerospace Laboratories (NAL), HAL, and Bharat Electronics Limited (BEL) have been working on projects but are yet to produce noteworthy results. Private organisations such as Israel Aerospace Industries (IAI), ideaForge Technology Pvt Ltd, and Edall Systems are involved in the development or part manufacture of these UAVs in collaboration with DRDO. Academic institutions such as the Indian Institute of Technology (IIT) Bombay and IIT Kanpur are also playing a role in the development of these Indian UAVs. However, indigenous progress has been very slow in contrast to the developments worldwide. DRDO’s painfully slow progress and very low levels of technology and the high prices of import have kept military inventories low. In February last year, HAL, Israel Aerospace Industries Limited (IAI) and Dynamatic Technologies Limited (DTL) signed a Memorandum of Understanding (MoU) for marketing, manufacturing and selling of IAI’s Unmanned Ariel Vehicles (UAVs) to Indian potential customers such as Indian defence services, paramilitary forces and central armed police forces at DefExpo 2020. Coming years will show if ‘Atmanirbhar’ will help Indian UAVs to come closer to global standards.
The size of our air force, the need to wield defensive and offensive air power to serve our power aspirations, our pretensions towards becoming an aerospace hub, our civil aviation’s immodest and stated ambition to ascend to a podium position in the international market, and our private aerospace industry’s demonstrated capabilities (so far more for foreign OEMs than for Indian ones) all underline the fact that the nation needs to recognise aerospace as a national strategic initiative. Conducting air shows is not adequate to lead aerospace forward; possibly, the time has come for aerospace industry to be taken under the wing of the Prime Minister’s Office (PMO) so that it can produce results once unencumbered by bureaucratic wranglings and delays. The argument to support this is that of the spectacular successes of our nuclear and space programmes which were spared being smothered by bureaucracy.
The biggest stumbling block in our defence aerospace sector has been its public sector trait which is slowly changing; one hopes that ‘Make in India’ and ‘Atmanirbhar’ will be catalysts to the move towards increased private participation in that sector. This is an arena where R&D is significant to moving forward towards manufacture, especially as we have lagged badly in aerospace technology R&D with our R&D as a percentage of GDP has been around 0.7 per cent. There is a need to increase it to at least 2 per cent of GDP for India to innovate in aerospace to the extent that it approaches the leading edge of technology; possibly a portion of this allocation could be routed to private players. It might be a good idea to include this as an expenditure head of R&D in annual budgets to ensure it is used accordingly. DRDO currently operates 51 laboratories; it is time to start privatising some of them so that their efficiency and productivity can be brought to acceptable levels and budgeted R&D funds utilised maximally. Whether private sector will want to invest in R&D is doubtful given the uncertainties of frequent policy reversals with governments and with the past history of patronage to public sector. A working model could be one in which the government invests in R&D labs that are universally and commercially available to all aerospace entities (and not just the public sector ones). Stifled R&D is the largest single stumbling block to India becoming an aerospace manufacturing leader. Leading edge aerospace technology can only come through technology transfer built into new aircraft deals including engine technology which has eluded our R&D so far.
The internal inefficiency of HAL has to be addressed, possibly at PMO level, if ‘Atmanirbhar’ is to take India to a world class aerospace manufacturer. HAL’s work culture cannot be changed nor can HAL be closed down given the huge investment and infrastructure that has already gone into it. Regrettably, its presence (and lobbying power) are an inhibiting factor for private enterprise. Indeed, the Indian Navy remains adamant against the inclusion of HAL in the USD3 billion deal for Naval Utility Helicopters (NUH), asserting that the company’s products do not meet the force’s requirements. If a big private player were to enter the aerospace arena, it will take maybe a decade or more to catch up in some spheres of HAL activity but after that, it will leave HAL far behind (and may also goad HAL into increased productivity levels). The malaise of trade unions in HAL are a major part of the problem. Despite HAL’s long experience in aerospace manufacturing, its technology base is mediocre as most production has been under license. Thus, even if the offset policy brings in transfer of technology there are limitations to what can be absorbed and how fast it can be absorbed. At the higher end of technology it would thus be a good idea to involve private houses already engaged in aerospace manufacture as their absorption will be better than HAL’s; this can be done through joint ventures with the foreign OEM contracted with.
There is also the issue of a low defence capital budget—inadequate for badly needed aerospace products; high priority needs to be given to the critical needs of the defence forces. At the moment, the possibility of defence budget being enhanced to meet defence aerospace needs and wants appears rather bleak; as a corollary, ‘Atmanirbhar’ in defence aerospace does not appear to be set for a spectacular jump in the near future.