(MENAFN- Asia Times) This week India hosted its 12th DefExpo in Gandhinagar in the western province of Gujarat. With its theme of“Path to Pride” – and guided by Prime Minister Narendra Modi's“Make in India” and“Self-Reliant India” campaigns – it not only showcased India's state-of-the-art defense technologies but seemed to unleash its so-called“animal spirit” in forging partnerships among Indians as well as with other global manufacturers.
As this biannual exhibition comes to a close on Saturday, the DefExpo of the presence of 1,340 companies from the Indian defense industry, including 100 startups, plus others from 75 participating nations, resulting in the signing of at least 450 memoranda of understanding.
Inaugurating it on Tuesday, Modi of India's defense exports having increased by eight times in last eight years and India now exporting defense materials and equipment to more than 75 countries, leading him to set the target of US$5 billion worth of such exports annually by 2025.
In fact, inaugurating the Aero India 2021 airshow at Yelahanka Air Force Station near Bangalore last year, Defense Minister Rajnath Singh had already announced of taking domestic defense production to $25 billion and exports to $5 billion by 2025.
Yet another talked of defense exports having risen by 334% in last five years, claiming the defense sector was on the“cusp of a revolution.”
On cusp of revolution
This mood and momentum in India's defense exports were surmised in Modi's inaugural address to the DefExpo, where he :“This is the very same country that once released pigeons; today it has reached a stage where it is releasing cheetahs.” He was referring to pigeons being the symbols of peace and to himself on his birthday last month eight Namibian cheetahs into Kuno National Park in central India.
In fact many sectors in India have lately begun talking of being on the“cusp of a revolution,” promising transformative early harvests of impressive outcomes. As for the defense sector, last year witnessed major restructuring in the Department of Defense Production (DDP). Seven new defense companies were carved out of its erstwhile Ordnance Factory Board. DefExpo 2022 saw them making their debut presence.
Second, the Stockholm International Peace Research Institute (SIPRI) database has for years shown India as world's largest importer of arms. So, as part of course correction by encouraging indigenous production, DefExpo 2022 saw the DPP its fourth Positive Indigenization List (PIL) of 101 items – taking the total to 411 defense items – that will be procured only from domestic production.
The first three PILs were issued in quick succession on August 21, 2020, May 31, 2021, and April 7, 2022, underlining the DPP's commitment to fast-forward this transformation.
Third, in exploring its competitive edge beyond Southeast Asia, the Middle East and the Indian Ocean littoral, India has begun to focus on Africa. On the opening day of DefExpo 2022, 53 African countries joined the second India-Africa Defense Dialogue (IADD).
Delegates included 13 ministers, four deputy ministers and other African senior defense officials.
The inaugural IADD was held in Lucknow in 2020 with an of turning India into a potential competitive arms supplier for Africa.
Leap of faith
It is important, however, to underline the formidable emotional and structural challenges that lie in the way of this newfound excitement. Being the land of the Buddha and Mahatma Gandhi – and known for having achieved its independence through a piecemeal transfer of power, largely through non-violent means – India for long was uncomfortable with either joining military alliances or exporting weapons.
The first jolt to India's low priority to defense came in the war with China in 1962. This saw defense expenditure being doubled, though as a percentage of gross domestic product, it remains lower than the global average and especially lower compared with its countries of concern, Pakistan and China.
Successive governments did try to modernize their inherited gargantuan colonial defense establishment, but resources remained limited and changes sporadic.
Serious change began from the early 1990s; with the improved growth rates of India's economy, budgets saw greater resource allocations for arms procurement, modernization and indigenization.
With increasing defense budgets, India became conscious of spending enormous amounts of precious foreign exchange on arms imports that were subsidizing research and development in supplier nations.
India also learned lessons of its limitations in ensuring quick and assured supplies in times of urgent need, such as during the 1999 Kargil War. More recently, Russian military operations in Ukraine may push India into reducing reliance on Russia.
In fact, experts compare imported defense equipment to crutches. By this logic, excessive reliance on defense imports can diminish the military muscle of a nation in the long run. It can make the importing nation captive to dictates by suppliers and vulnerable to greedy and opportunistic middlemen trying to capitalize in times of crisis for the recipient nation.
Indigenization drive
Arms exports therefore have to be understood as a byproduct of India's drive for indigenization. License production with Russia has moved to joint research and development. Their BrahMos cruise missiles joint venture has made India a sought-after exporter.
But the Department of Defense Production now showcases bigger achievements like India's first indigenous aircraft carrier INS Vikrant, the“Prachand” advanced light combat helicopter, and laser-guided anti-tank guided missiles. At DefExpo 2022, Modi India's latest HTT-40 trainer aircraft designed by Hindustan Aeronautics Ltd.
Second, it is important to note that India remains primarily focused in promoting non-lethal defense exports. India's export brochures list a whole range of solutions from bulletproof vests and vehicle armor to anti-drone systems, unmanned aerial vehicles (UAVs), mine-protected vehicles and so on.
This makes the United States the largest market for India's defense exports, followed by Israel, Armenia and, more recently, the Philippines and other Southeast Asian and Middle East nations. India is now exploring opportunities in South America.
Third, the credibility of India's exports is backed by proven battlefield capabilities of the country's armed forces and by the acceptance of indigenously produced weapons systems.
Another interesting fact is that India's defense production, which in the past was totally state-owned, has over the years encouraged public-private-partnership (PPP) and opened up several sectors for even 100% investment. As a result, more than 50 Indian companies in the private sector are known for to India's defense exports.
Speaking at DefExpo 2022, Defense Minister Rajnath Singh said India had already signed contracts for defense exports worth $1 billion in first six months of this year and since 2014 India had made defense exports worth more than $4 billion.
Another quoted India's Defense Ministry claiming a sixfold increase in defense exports since 2014 a total of $1.6 billion for financial year 2021-22.
Reflecting this fervor, and backed by additional orders from the Philippines as well as progress made in its negotiations with Vietnam, Malaysia and few other nations, Atul D Rane, the chairman of India's flagship BrahMos Aerospace, its BrahMos cruise missiles alone will be able to achieve the set export target of $5 billion by 2025.
Long way to go
However, notwithstanding this enthusiasm, India has a long way to go in making its presence felt in the global arms market. According to , for the period 2017-2021, India was listed at 23rd out of the 25 largest exporters, accounting for a 0.2% share. This leaves India far behind the big five – the US, Russia, France, China and Germany – that together account for 77% of all arms exports.
This, however, can also be seen as reflecting enormous space to maneuver. The ongoing Ukraine war could not only negatively impact Russia's defense exports but present India as an ideal candidate to take that space as well.
A potential scenario of India reaching even a single-digit percentage share of the global market could make a great difference for its future course. Making that first dent should be possible for India given its track record and visible global presence.
But India will have to continue with reforms at home. Currently, India's defense production revolves around defense public sector undertakings (DPSUs) and ordnance factories, and yet it is India's foreign joint ventures and private companies that have this recent upsurge in defense exports.
This is in spite of its state DPSUs having the great advantage of availing India's defense and other lines of credit extended to various recipient nations, availing preferential trade agreements and services of defense attachés in Indian missions abroad.
Both the need and the opportunity for defense exports seem to be staring India in the face to cross that“cusp” and revolutionize India's defense sector. It will be equally interesting to explore its spin-offs for various civilian sectors.
Follow Swaran Singh on Twitter @SwaranSinghJNU.