A look at DTTI, an important element in building deeper Indo-US defence ties
Brig. Arun Sahgal (retd)
Defence Technology Transfer Initiative (DTTI) has emerged as the centrepiece to build deeper Indo–US defence cooperation. The initiative, which is part of a recently signed Defence Framework Agreement 2015, is aimed at assisting India in creating a strong defence industrial base and concomitant ecosystem. The broad objectives are:
• Strengthen bilateral relationship to strategic levels, given the converging strategic interests of both the countries in Asia-Pacific.
• Assist India in developing credible military capability to support both countries’ regional interests.
• Help strengthen Indian defence industrial base through technology transfer or sharing on the basis of co-development and co-production.
Both India and the US are committed to push this unique initiative that aims at moving bilateral relationship to a higher strategic trajectory. As mentioned earlier, the overall objective is to provide cutting edge defence technologies that include both co-production and more importantly, co-development. Both sides have taken nascent steps in identifying some path-breaking technologies essentially aimed at pushing the process forward. Based on interactions with stakeholders on the Indian side, there is a clear commitment to move forward. Despite these positive developments there, however, exist some perceptional gap both in terms of understanding what DTTI means in practical terms and future roadmap.
Indian perspective is being shaped by the growing asymmetry against China and declining conventional edge vis-a-vis Pakistan, primarily owing to lackadaisical modernisation and complete lack of transformational effort.
Capability development is suffering on account of acquisition oriented decisions based on long-winded and dodgy qualitative requirements, and excruciatingly time-consuming processes, hampered by corruption. Seen in broader strategic construct, this is taking its toll in denying Indian military the capabilities required to emerge as a net regional security provider. It is against this backdrop India looks at the initiative in addressing India’s critical ‘technological’ needs.
Indian Perspective of DTTI
Indian defence ministry remains committed to the concept of DTTI as a means of gaining critical strategic technologies from the US that will help propel India’s defence industrial ecosystem towards self-sufficiency, addressing critical technological needs, what with India emerging as an arms developer and exporter from being arms acquirer over a period of time.
For the Indian ministry of defence (MoD), DTTI represents a commitment by the US in assisting India build a credible defence industrial base and capability through hi-technology infusion. Thus, it looks upon DTTI as the route to getting critical technologies that they are finding difficult to indigenise, or time consuming, for e.g. up-gradation of GE 414 for Tejas Mk II.
This thinking is driven by the core ‘Make in India’ perspective, the sole purpose of which is to ‘manufacture or assemble’ big-ticket projects in India with technology absorption from abroad. Hence, the interest in critical game-changing technologies like gas turbine engines for aircraft, nuclear propulsion technology, Electro Magnetic Aircraft Launch System, etc.
In working the DTTI initiative, nonetheless, there are apprehensions with regard to technologies on offer and the constraints of the US arms control laws. In the perception of the MoD the whole initiative appears to be US industry driven and not so much as an American government initiative. This perception is based on the fact that out of earlier 17 technologies on offer 12 were industry driven, four by the US government and only one joint R&D and subsequent production. Whereas there is acceptance that the majority of technologies are incubated in the private sector, however, it is argued that for development of credible bilateral relations, the US government would need to push these companies for technology transfer co–production initiatives. Simply put, the perception that the US government has no hold on these MNCs is not bought, as a large number of development funding are provided by the US government which also decides on export control laws.
To drive home its point, a number of key technologies have been identified by India as its core areas of interest; some of these are, anti UAV systems, advanced UAV technologies in MALE and HALE class, advanced smart weapons e.g. Raytheon Paveway IV LGB, ship based point defence, nuclear propulsion, joint production of 115 and above KN gas turbine engines, etc. Based on the above, in MoD’s perception the DTTI’s relevance is in four key areas:
• Co-development and co-production of strategic technologies, some of which have been outlined above.
• Collaboration in S&T
• Reforms in US Arms Trade Control Laws.
• FDI investments in exceptional technologies areas.
US Perspective of DTTI
On the other hand, the edifice of the US initiative is based on political and strategic judgment to help India develop credible strategic military capacities as a partner in Asia–Pacific, to lend weight to its rebalancing strategy. India is seen as an important lynchpin for shaping security architecture in the region, particularly in the face of aggressive Chinese posture in South-East Asia.
The basis of defence cooperation and strategic partnership in core technology areas offered by the US flows out of this central US assessment. By implication this means commitment to help build technological capacity and innovation, which will significantly transform Indian military capabilities. It is on this basis that the US has made a number of offers for technology sharing or transfer (17 technologies initially and four subsequently).
India has accepted to co-produce two technologies: Mobile Electric Hybrid Power Source and Next Generation Protective Ensemble as part of pathfinder projects. The reason attributed by American interlocutors is that this will help to put processes in place as also mutual confidence. Based on the foregoing, the core US considerations for DTTI are defined by the following:
• Export Control Laws that control transfer of US technologies.
• Secondly, since a majority of technologies are incubated in the private sector, which looks at technology sharing and transfer from a business model based on four commercial perspectives — scaling of FDI, nature of indigenous technological base, cost leveraging if production base is shifted, and last but most important, IPR.
• On the issue of co–production or joint development, central issue for the US Original Equipment Manufacturers (OEM) is whether the US government’s overall intent of the project, beyond the strategic construct. Local demand only i.e. armed forces centric or for exports as well. Will these joint production ventures face repeated Request for Proposal (RFP) oriented competition or allowed, ‘sole source contracting’?
• Major unstated aim of the DTTI appears to be ‘sole source contracting’ which is deemed as a just demand for resources and technological infusion.
• In short, the development of a market driven defence eco-system that is connected to global value chains based on integrated skill development, research, quality output and institutional and infrastructural development, apart from availability of infrastructure, is to be based on above minimum specific criteria.
Comments
It is apparent that there is a huge perceptional gap between the two sides starting from the relevance and objectives, even though both sides have signed a very detailed memorandum of understanding (MoU). Second, the American sides look at the whole issue of technology cooperation under the DTTI as a strategic arrangement, and therefore, entitled to exceptional procurement provisions. India sees as of now little strategic technology initiatives coming from the Americans.
Simply put, India does not see closeness in relations and what is on offer anywhere near as close to the former Soviet Union or Russia; that has not hesitated to share critical game changing technologies; lease of Chakra or nuclear propulsion system for Indian nuclear submarine are quoted as prime examples.
In the true spirit of building a strategic partnership, an India-specific ‘Arms Control Regime’ that strikes the right balance between strategic partnership and security concerns is suggested under the overall rubric of Defence Framework Agreement. The aim of such a regime would be;
• Help establish capacities to deal with challenges to regional security and stability.
• Create India’s potential as net regional security provider in the face of assertive behaviour by major regional challenger.
• Contribute to the security of global commons. Help in establishing rule based regional architecture wedded to democratic principles and international law.
• Help fight terrorism and piracy.
Current Issues
Apart from perceptional differences highlighted, there are other multiple factors that militate against close partnership. First and foremost is the nature of relations. While both sides are attempting to build close collaborative relationship, India is not an American ally or major non–NATO ally. Thus, despite good intentions, both the US laws and political discourse act as inhibitors.
Multiplicity of export laws that govern weapons and weapon technologies as also commercial dual use. License is required for nuclear, missiles, or chemical/biological related weapons or dual use technologies. Direct sales, technology transfer, co-production/ co development are reviewed on a case-to-case basis. Export to entity list companies require a license.
No doubt, following the Indo–US Nuclear Deal, a fair amount of forward movement has been made. From 2011-13, Entity List has been reduced, including removal of Indian Space Research Organisation (ISRO). In addition, India has been added to Strategic Trade Authorization — which permits export of a defined set of items on the Commerce Control List to Allies and certain other friendly countries without a specific license. These items include certain dual-use items and certain less significant munitions items, predominantly parts and components.
Last and importantly, all sales to India are controlled by two critical criteria; material contributions to indigenous weapon mass destruction (WMD) programmes and even more importantly destabilising the impact vis-a-vis Pakistan.
Peace through Strength
To strengthen bilateral strategic partnership, of which DTTI is the most visible element and a major perception management tool; the following is recommended:
• To strengthen regional forces allied to the concept of democracy and free markets, ensure regional stability, address the destabilization of balance of power in South Asia post US withdrawal and growing Sino–Pak economic, military and strategic collusion.
• Help India emerge as a net security provider in South East Asia and IOR.
• The above can be achieved by helping India build Qualitative Military Edge (QME), to deal with both security threats and broad range of other challenges.
• Joint assessment of what QME for India means. Identify strategic technologies based on the above for co-production and co-development. To meet the above objectives, there is need for an India-specific export license exemption for military sales, co-production and development for India. • To ensure practical application of such an exemption, India too will need to revamp its defence industrial ecosystem to facilitate technology transfers and absorption. A commitment on these lines will have to also be given by India. Of course, broad details will require to be worked out in a collaborative manner.
The trajectory of Indo-US relations has never been as positive with both countries and their leadership willing to invest political capital to lay the foundation of strong and sustainable relationship. Defence security and technological cooperation is an essential part of these relations.
No doubts differences in governance models, past baggage and the differences in power equation lead to some perceptional hiccups, but going by the close and consistent political understanding and widespread view within the Indian system to ensure primacy and credibility to this relationship, it would be worth the US while for India to look closely at the concept of QME as another game changer in relations.
(The writer is director, Forum for Strategic Initiatives)