India wants fighter jets – but without American baggage
As Boeing vies for a contract to build 126 new fighter jets for India, an estimated 35,000 new US jobs are at stake. But America’s foreign policy may tilt India toward European firms instead.
After a curt “no,” the Indian pilot asks to test out the machine. He lauds the F/A-18's maneuverability and touch-screen cockpit display. It's a far cry from what he currently flies: A Soviet MiG-21 that was outdated even in Maverick’s day. India is looking to buy 126 new fighter jets and Boeing is dogfighting against five international firms to land the deal this year.
Despite some of the sales tactics on display at the recent Aero India 2011 show in Bangalore, there’s more to selling fighter jets than moving Chevys. Giving "test-drives" and offering value for money is important, but so are international politics. And on that score, US firms have hurdles that European competitors do not.
Much is at stake for the American economy, including a $10 billion-plus sale and an estimated 35,000 new US jobs. Trips by presidents Barack Obama and George W. Bush to India have increased US chances of bringing home that bacon. But America’s not-so-humble foreign policies over the years may prove costly in an era of strong European competition in the defense industry.
“The quality of European airplanes today – for that matter the Russians, too – has now reached a point where countries like India really do have choices,” says Ashley Tellis, author of a study on the jet fighter tender for the Carnegie Endowment for International Peace. “In that sense, [US] political choices are more constrained than they were before.”
India's 'trust deficit' toward America
Retired Indian generals and industry analysts say Indian officials have two reservations about buying American.
First, New Delhi worries about relying on US parts given the sanctions Washington imposed in 1998 when India went nuclear. In case of a war with archrival Pakistan – a US strategic ally – would Washington curtail military trade again?
Second, US law requires defense agreements to be signed by any country purchasing certain high-tech military equipment. The US failed during Obama’s visit last year to get Indian sign-off on two such agreements: the Basic Exchange and Cooperation Agreement (BECA), and the Communication Interoperability and Security Memorandum of Agreement (CISMoA).
According to Mr. Tellis, the CISMoA would keep India from transferring sensitive US encryption technology to another country. The BECA, meanwhile, has been misunderstood as a deal that would plot Indian military units on a global grid visible to the US and its partners.