Arms Trade
Second Oldest Profession

Publisher and Managing Editor IKRAM SEHGAL  wrote this article for THE NATION which the DJ is re-producing with thanks.

The Vajpayee Government has been rocked by the Tehelka scandal, the scam exploding the self-propagated myth of BJP's pristine conduct while in governance. For the moment the Parliamentary decorum of Lok Sabha is in shambles and sessions have been repeatedly adjourned in the face of violent protest by the Opposition bent upon exploiting the widening chink in BJP's armour. Outspoken Defence Minister George Fernandes (and leader of his own party in the BJP-led coalition) has resigned in the face of his close friend and party colleague Jaya Jaitli accepting a bribe in front of a hidden camera. The carefully crafted facade of the corruption-free administration of super-India has been blown away by an enterprising investigation team that has exposed the utter degradation of the arms procurement process of the Indian Armed Forces. Several holier-than-thou uniformed luminaries recently appeared on various Indian TV channels to squeeze the last drop of anti-Pakistan Army propaganda out of the Hamoodur Rahman Commission (HRC) Report. But is there anything more demeaning than to see uniformed officers on video-tape not only engaging in polite conversation how to shortcircuit the procurement process but also receiving bribes? Whether civilian or army officials, politicians  or party activists, all were recorded by a hidden TV camera to be part and parcel of a giant corruption combine that has been milking India dry for decades. The greatest number belonging to the world's oldest profession live in India, they even held an open air world convention in Kolkata (Calcutta) a few weeks ago. These ladies may have been some way ahead in morality when compared to the arms trade, the world's second oldest profession. The transcripts make amazing reading, the video-tapes amazing viewing. The entire gamut of civil and military leadership in India is seen on prime time TV as being not only thoroughly corrupt but being dangerously ignorant of defence equipment and their potential use.

Col (Retd) Ravinder Pal Singh (of the Mahar Regiment) wrote two books on “Arms Procurement Decision-making” when he was leader of SIPRI's Procurement Decision Military Project in Stockholm, I have taken the liberty of quoting extensively from his research. The effectiveness of a free press in democratic India holding defence procurement accountable is limited by a number of factors. Academic research in national security studies is constrained by a relative lack of public information, in any case defence subjects are normally taboo in India. Lack of interest in the Lower House of the Indian Parliament (the Lok Sabha) is because of the low electoral value of defence issues. An under-informed but vocal society treated defence procurement (till the Bofors Scandal) like a sacred cow.

The history of arms procurement in India can be divided into three phases: (a) from independence in 1947 until the early to mid-1960s; (b) from the mid-1960s, that is, after the 1962 Sino-Indian and 1965 India-Pakistan conflicts, until the mid-1980s; and (c) from the mid-1980s to the present day. Like in Pakistan initially there was off-the-shelf procurement by import, predominantly from France and the UK. Domestic defence production was built-up in the 60s, mostly through assembly under licence from the Soviet Union and the UK. In a way that circumscribed a thorough evaluation process. Rajiv Gandhi's Government made large purchases during 1984-89, gradual improvements were made in research and development (R&D) and systems integration for in-country assembly of weapons.

India was shocked by the 1962 border war with China. Defence Minister Krishna Memon had turned his arms factories into manufacturing consumer items, an ASC officer, Lt Gen Kaul made it to the command of a theatre of operations, the net result was disaster. Systematic defence planning began with the introduction of five-year defence plans in the mid-1960s. The first two plans (1964/65 and 1968/69) proposed building a defence production base to gradually reduce external dependance. The Minister of Defence (MoD) Planning Cell draws up the five-year defence plan for approval by the Defence Minister and the Cabinet Committee on Procurement Affairs (CCPA). Each Armed Service bases its annual plans on this plan. Long-term plans with a 15 to 20-year time-frame, called perspective plans, are drafted by the Armed Services. In 1986 the Government of India set up the Defence Planning Staff (DPS), a multi-disciplinary body consisting of representatives from the three Armed Services, Defence Research and Development Organisation (DRDO). DPS provides inputs to the Chief of Staffs Committee (COSC) on a variety of issues related to defence planning including: (a) international and regional security affairs; (b) defence policy; (c) weapons and equipment, and (d) financial planning. The COSC coordinates broad military objectives and strategies and forwards its recommendations to the MoD. After its advice to the MoD on military strategy has been accepted, each of the Armed Services plans its own force levels and related weapons and equipment procurement. The 1987-88 parliamentary inquiry into the Bofors contract exposed the inner workings of the Indian Army's formal arms procurement process, mostly it was a bureaucratic chain, a fig leaf for outside observers. It is reasonable to presume that the Navy and the Air Force will follow similar procedures.

The preparation begins with a Philosophy Paper, broadly identifying the characteristics and advantages of new weapon systems in broad terms. The General Staff Equipment Policy Committee (GSEPC) is then Chaired by the Vice or Deputy Chief of the Indian Army and including representatives of the MoD, the DDR&D, the DDP&S, the Finance Division of the MoD and other agencies, GSEPC formalizes weapon and equipment requirements in policy statements based on data from the army's directorates of military operations, staff duties, and weapons and equipment. These policy statements serve as guidelines, the DRDO comments on the feasibility of indigenous development. On the basis of the Philosophy Paper and DRDO's assessment, the MoD then examines whether it is feasible to indigenously develop or import a system. If import option is chosen, Defence Attaches at Indian embassies abroad identify potential suppliers, to present their proposals. These are sent to the DRDO, the DDP&S and the Finance Division of the MoD for comments. The amount of foreign exchange involved dictates whether the Financial Adviser to the Defence Minister or the Secretary of Expenditure at the Ministry of Finance must approve the transfer. The MoD then either approves for trial evaluations of the weapon system in India or sends its study teams abroad. Trials are usually conducted on a 'no cost, no commitment' basis.

The technical aspects of the proposals are examined by a "Technical Evaluation and Negotiating Committee" against the requirements identified by the Armed Forces. The proposals found technically acceptable are forwarded to the Price Negotiating Committee (PNC) for commercial negotiations. Both are MoD committees, but the PNC also has a representative from the Ministry of Finance and can invite revised quotations from the competing firms during the negotiations. Contracts for purchase may include an agreement for or commitment to licensed production, which is signed by the DDP&S. Corresponding credit agreements can also be negotiated simultaneously. Financial authority for procurement upto rupees (Rs) 200 million ($ 5.5 million) rests with the Secretary of Defence, for amounts up to Rs 500 million ($ 13.7 million) with the Defence Minister and for amounts above that with the CCPA. For common user systems, the Inter-Service Equipment and Policy Committee (ISEPC) coordinates the requirements of the three Services.

This complicated process is supposed to make the procurement effective and corruption-free, the opposite has become the norm. Moreover, the decision-making process is civilian-heavy. The Indian Air Force asked for a jet trainer almost 15 years ago, it has now just reached the evaluation stage, it will be obsolete before it reaches the operational line, if ever Tehelka showed how complicated systems are prove to be easily corrupted by those controlling the system. Corruption is alive and well in Pakistan but our systems are less complicated and more user-oriented. In India the user is reduced to being almost a beggar in the hands of a civil-military bureaucracy with scant knowledge of equipment. One of the papers to pass in a "Lieutenant to Captain Promotion" Examination is "Military Science" where every young officer in the Pakistan Army gets good technical knowledge of almost all present and future development of lower weapons and equipment in the world. Civilians are usually ignorant about arms and equipment in the decision-making line-up, a corrupted process is a distinct possibility. Our arms merchants are far more sophisticated, probably because the procurement system is simpler and fewer people are involved in decision-making, making the decision-maker more responsible as to the consequences of corruption. It may well be satisfying for Pakistanis to see Indians stewing in their own juice after having had their own way in Pakistan-bashing since Kargil but it may be prudent to scrutinize the checks and balances in our procurement systems. The Vajpayee Government may or may not bite the dust because of Tehelka, Pakistan cannot afford such a scandal.