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Double Whammy for Spares for Indian Air Force


Apart from availability of spares, payment challenges due to surplus rupees accumulated in Moscow may be a double whammy for operational readiness of the Indian Air Force. So what are the options?


It is now reasonably well established through various open sources that the Indian Air Force has a challenge of procurement of spares for the Russian combat fighter platforms the Su 30 MKI as well as the MiG 29.


A Bloomberg report has outlined how $ 2 billion in payments due from India is leading to an impasse with Moscow which is declining credit for “$10 billion worth of spare parts as well as two S-400 missile-defence system batteries that are yet to be delivered”.


The long drawn-out war in Ukraine means that the IAF stocks may be running out while at the same time supplies from Russia are not forthcoming. Indigenisation of spares is a complex process which had been started a couple of years back but this has apparently not made any headways.


Aditya Pareek of Takshashila Institution and Pranav R. Satyanath have highlighted this facet in the Print. They underline the limited progress in indigenising of spare parts for Russian-origin platforms by India despite the known challenges that may arise in case of a geopolitical crisis.


Given Russian inhibitions in allowing indigenous spares being utilized on platforms supplied by OEMs and on which there are limited quality controls, the process is reported to have stalled.


Spares Policy


Policy on procurement of spares has been specified as given in the Defence Acquisition Procedure 2020 [DAP] and the Defence Procurement Manual 2009.


As per the DAP – contracts for procurement of main platforms from the Original Equipment Manufacturer (OEM) should include the spares and ancillaries based on the Life Cycle Support System.


Arrangements for localization of spares can be made with the OEM as well. Thus contracts for spares have possibly been made with Russia for MiG as well as Su 30 OEM for Life Cycle Support and also indigenization.


In case of indigenization the OEM must accept the spares for quality as these would be used in the original mainframes Su 30 or MiG provided by it. The indigenized spares will have to be certified by the Russian OEMs if not directly manufactured by them and being outsourced through Indian industry.


Without acceptance of these by the OEM, operational performance of the aircraft will not be certified.



Process for Local Production


The process for local production is said to be under discussion if reports are to be believed. A report in the Defense News states that Defence Minister Rajnath Singh and his Russian counterpart Sergei Shoigu discussed military-to-military ties as well as industrial partnerships during the bilateral on the sidelines of the Shanghai Cooperation Organization Defence Minister’s meet on April 28.


While details of the outcome are not known but Defence News report states that recently corporatized government controlled entities which were part of the Ordnance Factory Board in the past will form joint ventures with Russian original equipment manufacturers.


Where some spares have been indigenized by the Indian industry through local initiatives these need to be certified by the Russian OEMs.


Even where such a process is undertaken it will be time consuming as negotiations between defence entities are long winding despite the urgency of spares required by the Indian Air Force.


Payment Hurdle


The second hurdle that is likely to come up is for payments for spares and other goods as it is believed that India and Russia have suspended negotiations to settle trade in rupees as with a high trade gap of $ 40 Billion worth of rupees piling up Moscow is not keen for further accumulation and it is reported that India and Russia have suspended settlement of bilateral trade in rupees despite extensive negotiations.


The challenge comes as the Rupee is not fully convertible and with low share in global exports of goods to about 2% there is not much demand for the Indian currency in the global markets.


While active negotiations are ongoing between India and Russia, the most recent one being during the visit of Deputy Prime Minister of the Russian Federation and Minister of Trade and Industry, Mr. Denis Manturov, the Co-chair of the India-Russia Inter-governmental Commission on Trade, Economic, Scientific, Technological and Cultural Cooperation (IRIGC-TEC) to New Delhi from 17- 18 April 2023 more needs to be done to impress upon Russia, India’s critical needs particularly in the defence field.


Options


India has to take up with Moscow critical needs of the Indian Air Force and urgent supply of spares, for that is what the Special Strategic Partnership between the two countries is all about. India has defied pressure from the West to sustain energy imports from Russia worth $ 35 billion or more and now it is Moscow’s turn to payback.


Options such as line of credit can be exercised with payments offset over a longer term.


In addition Indian MOD will have to ginger up the processes for early commencement of indigenized spares through joint ventures with Russia given the corporatized entities of the erstwhile OFB continue to be operative under the Department of Defence Production.

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