26 September 2018 02:18 PM

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SEEMA MUSTAFA | 18 JANUARY, 2018

On-Off, On Again Missile Deal With Israel: Where Has “Make in India” Gone?

Netanyahu says missile deal revived, no word on specifics


NEW DELHI: Why was the anti-missile deal with Israel cancelled? And why has it been revived again? Or has it? And in what form?

The answer to the first question that emanated from official corridors at the time was that the government wanted to give a boost to its Make in India program, and despite rapid progress with Israel on this deal, decided to go with the Nag anti tank missile developed by the Defence Research and Development Organisation.

India’s DRDO was said to have queered the pitch for Israel, having come out with its Nag anti-tank missile that it said would perform the same tasks, at a fraction of the price. It promised to provide the missiles within four years and carried out successful flights of the missiles. “With these two successful flight trials, and the flight test conducted earlier in June in the peak of summer, the complete functionality of Nag ATGM along with launcher system NAMICA has been established and marked the successful completion of development trials of Nag Missile,” the Ministry of Defense announced last year.

And shortly after the government moved to withdraw the Request for Proposal with Israel on this deal. The dismay in Tel Aviv was palpable, and the cancellation made matters worse for Israeli Prime Minister Benjamin Netanyahu, already on shaky ground over corruption allegation at home.

Thus, when Netanyahu travelled to India this remained the biggest ticket on his agenda, a deal that he desperately needed to survive the growing pressure that was threatening his government at home. He did not lose sight of this despite the hugs and atmospherics, with CEO of Rafael Advanced Defense Systems Major General Yoav Har a vital part of his entourage to India.It was thus, with some relief that at the end of the visit Netanyahu was able to announce that the deal was back on track, although again there has been no concrete word from New Delhi, or any specifics of the renewed agreement.

In a statement Netanyahu said: "Following the talks I had with my friend Prime Minister Narendra Modi, the Indian government has informed us that it is putting the Spike deal back on track."

"This is very important and there will be many more deals," he added. This clarification came amidst whispers of ultimatums given by Israel to India following the cancellation of the missile deal.

The Spike deal had progressed rapidly with Rafael Defense beginning preparations for delivering the missile. It had opened a production facility in August with a local partner Kalyani Group in Hyderabad, and according to sources, the process was far advanced. In a speech at its inauguration, Rafael CEO Maj. Gen. (res.) Yoav Har Even said the factory “is another expression of the strong cooperation between Israel and India in general and of Rafael as a strategic ally of India in particular.” Hence news of the cancellation came as a major setback for Israel’s defence major.

However, it is still not clear whether Israel has got just a truncated version of the original Spike anti-tank missiles and launchers, or whether the full agreement of 5000-8000 missiles and 350 launchers has been revived. Sources said that under the current discussions, with Israel exerting full pressure, the deal has been truncated by about 50 per cent, with clearance for 3500 missiles and 180 launchers to be bought off the shelf. However, this remains unofficial as there has not been a word of confirmation, or for that matter denial, from the government of India.

It might be recalled that this lucrative deal also had US defence companies salivating at the onset. US defence major Lockheed Martin had placed a bid to sell Javelin missiles, with US Defence Secretary Ashton Carter pushing hard for the deal. However, the government favoured Israel’s spike missiles instead as these were cheaper at what the Americans described as base prices “with which we cannot compete”, but then went on to withdraw the Request for Proposals on the virtual eve of Netanyahu’s visit. It had been reduced to a single vendor deal that has created problems in the past, and a procedure with which the Ministry of Defence is not particularly enamoured. Now, according to Netanyahu, the deal is back on track without any explanation as to why it was cancelled at the beginning, and what has changed to revive it within weeks of the RPF withdrawal.

The Indian Army, sources said, is “desperately” in need of the anti-tank, to bring its fire power up to date. The delay in acquisitions, and the manufacturing of anti-tank missiles, has been a major area of concern with the range of the current missiles in use being just about 2 km that sources said was “even less than the Pakistan missile range.” DRDO had assured the government of supplying “a world class missile” within four years, an assurance that had led to the cancellation of the Israeli deal. What has changed since is not known. Significantly, the ‘back on track’ announcement by Netanyahu has still to find an official echo in the Ministry of Defence corridors.

Local Israeli newspapers have been tracking the deal quoting Israeli defence sources as saying, “the presence of the CEO on the prime minister's official and very important visit is crucial right now.” As a cancellation of this deal was expected to deal a crippling blow to the Rafael defence industries. Interestingly, Netanyahu was accompanied by a full defence representation including Israel Aerospace Industries Ltd. CEO Joseph Weiss and senior executives from Elbit Systems Ltd.and Aeronautics Ltd. Aeronautics is currently under police investigation in Israel.

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