US-Russian companies jockey for govt contracts

US-Russian companies jockey for govt contracts
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First Published: Wed, Feb 07 2007. 11 39 PM IST
Updated: Wed, Feb 07 2007. 11 39 PM IST
In 2005, the US presence at Aero India was limited to two F-15 fighter planes that did not fly.
“They were stationary on the runway,” US ambassador David Mulford recalls.
What a difference a couple of years—and the country’s soaring demand for all things aerospace related—can make.
The US has, for the first time, flown in its big guns for this year’s air show, the biggest in terms of participants, seeking a slice of a market that may generate $30 billion (about Rs1,32,000 crore) of defence deals in five years.
More than 50 firms from the US are taking part in Aero India, including Boeing Co., the maker of the F-18; Lockheed Martin, the manufacturer of the F-16; General Electric and Raytheon.
The massive C-17 heavy lift-aircraft, the naval reconnaissance P-3 Orion and the CH-47 Chinook cargo helicopter will all be in action over the skies here. “This time, we have three F-16s and two F-18s, which will be flying, as will other airplanes,” says Mulford.
What the banker-turned-diplomat called the “heightened visibility” of the US at the event, is symbolic of the warming of a relationship that has often been uneasy.
“These are issues that go back in time,” he said, addding Washington wants to prove itself to be a reliable military supplier for the country.
Now, India should “try us”, he said, promising technology transfers and help in local production.
It won’t be easy. Competition to the US firms is very visible here in the form of the Russian-built MiG 35, in addition to the Swedish built Jas-31 Gripen, and the Eurofighter built by several EU countries.
The Russians, who are also here in full force, have an added enticement: They are more likely than American manufacturers to share technology, allow licensed production and even jointly produce a fifth-generation fighter jet.
“Our relationship with India is in a state of transition, from that of seller and buyer, to that of a development partner,” said Dzinkalan Vycaheslava, a spokesperson for the MiG corporation.
India is Russia's biggest customer for defence exports.
The challenge for the US companies is that they are relative minnows here, even though they are giants abroad.
For instance, Raytheon’s annual revenues are higher than India’s defence budget.
“The basic point is that the (Indian spending plan) is so much larger now than it was in 1990,” said N.S. Sisodia, director of the Institute for Defence Studies and Analysis, who at one point was the key bureaucrat involved in India’s defence production.
Despite low-level presence in India for years, many American companies have a long way to go.
“We are still learning about the Indian way of doing business,” said Wes Motooka, vice-president of international business development at Raytheon.
Both US companies announced agreements with Indian companies—Tata Power with Raytheon and Bharat Electronics Ltd with Northrop Grumman.
“We are going through a delicate dance,” said Woolf P. Gross, corporate director of International Programs at Northrop Grumman, just minutes after Air Force chief of staff S.P. Tyagi took a tour of their stall.
Raytheon, meanwhile, said last week it appointed as head of its India operationsan admiral who holds a degree from Madras University.
“The potential for India is just so large that as our nations get closer, it creates opportunities for American defence businesses to get involved,” says Raytheon’s Walt Doran.
(Anil Penna of AFP contributed to this story.)
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First Published: Wed, Feb 07 2007. 11 39 PM IST
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