Economy

Selling Russian Arms In New Delhi: Seeking Revenue & Influence

Analysis 12 October 2018
Selling Russian Arms In New Delhi: Seeking Revenue & Influence

President Vladimir Putin visited New Delhi last week (October 4–5) with a large posse of top businessmen and ministers to promote trade and large arms contracts. India has been a major Russian (Soviet) ally since gaining independence from the United Kingdom and a major consumer of Russian weapons and defense technology. The Indian Army’s armor units run Russian tanks, the Indian Air Force’s front-line fighters are Russian and the Navy sails Russian submarines (including a nuclear-powered attack sub), Russian-built frigates and the carrier INS Vikramaditya (former Admiral Gorshkov). Over the years, Russia has built up excellent informal relations with the Indian military and intelligence establishment.

During the Cold War, the Moscow–New Delhi strategic axes faced off China and its long-time ally Pakistan. After the Soviet Union withdrew from Afghanistan in 1989 and eventually collapsed, the balance of power in Asia began to shift: China, a Cold War nemesis, became an increasingly close strategic partner of Russia, while relations between the United States and India steadily improved. The US turned into a major arms supplier to India, as Russia was pushed back in a market it always took for granted. A panic of sorts—“We are losing India!”—became trendy in Moscow. Putin’s visit with a large delegation in tow to New Delhi was designed to reverse the trend and pull India back into the fold (Interfax, October 5).

In particular, the two sides signed a major contract to sell India five regiments or ten batteries (known in Russian as “divisions”) of new and sophisticated S-400 anti-aircraft missile systems, worth $5.43 billion. India does not have any credible national anti-aircraft missile-defense system, relying on its jet fighters to provide defensive cover against other aircraft. Moscow touts the S-400 as the best in the world, claiming it has an extended range of up to 400 kilometers and can also intercept medium-range ballistic targets at a range of 60 kilometers. It would seem rational for India to buy a large consignment of S-400 strategic anti-aircraft missiles to form the base of a future national air/space defense system.

But the US has threatened to impose sanctions on countries that purchase new Russian weapons. In 2017, the US Congress passed, and President Donald Trump reluctantly signed, the Countering America’s Adversaries Through Sanctions Act (CAATSA), adopted in response to alleged Russian interference in the 2016 elections and military involvement in both Ukraine and Syria. Under CAATSA, the US may impose so-called secondary sanctions on individuals, companies or countries that cooperate with Russia’s defense industry or procure Russian weapons. Washington has recently imposed sanctions on China for buying a consignment of S-400s and Su-35 fighter jets. Consequently, last week’s Russian arms trade talks in New Delhi were described as being held under the threat of US sanctions, as the “unpredictable Trump” could decide to punish India (Interfax, October 5).

Indo-Russian wrangling over the terms of the S-400 deal predates CAATSA by several years. The Indians wanted to slash the S-400 price and attain a transfer of anti-aircraft missile technology. In the end, they reportedly obtained a discount on the package deal on S-400s that included training of Indian personnel. In an apparent act of defiance to US threats, India’s Prime Minister Narendra Modi okayed the final version of the S-400 deal. Moscow expected that during Putin’s visit India might sign two other major arms deals—the purchase of four Project 11356 frigates and forty-eight Mi-17V5 helicopters, together reportedly worth some $3.3 billion. But those deals were ultimately postponed, pending further negotiations (Militarynews.ru, October 8).
 
The S-400 deal and also a framework “road map” agreement on future Indo-Russian nuclear power cooperation, signed while Putin was in India, have been hailed in Moscow as a major success. Since Russia sees itself as playing a global zero-sum game with the mighty United States, a successful presidential visit to New Delhi is perceived as a serious strategic victory that may diminish US influence on the Indian subcontinent. Indian officials are quoted in the Russian press as insisting they are not afraid of possible US CAATSA sanctions and are running an independent foreign policy. Both Moscow and New Delhi confirmed they will be working on possible new arms deals and will seek a procedure to resume money bank transfers to Russian arms producers that have been placed under US sanctions (Interfax, October 8).
 
Washington’s efforts to build up economic, military and political ties with New Delhi have, in recent years, deprived Moscow of billions of dollars in possible arms-trade revenue. At the same time, they are ruining long-term Russian plans to build a grand anti-US alliance in Asia—the so called strategic triangle between Beijing, New Delhi and Moscow, first promoted by former prime minister Yevgeny Primakov, in 1998, during a visit to New Delhi (Kommersant, December 24, 1998). Neither China nor India took Primakov’s proposal seriously at the time, but in Moscow the idea is still highly popular. Primakov died in 2015. The following year, in Moscow, at a special conference in his honor, Putin delivered a keynote speech specifically praising Primakov’s opposition to US world dominance, the promotion of the “multipolar world” and the Russo-Indian-Chinese strategic triangle. “The proposal [strategic triangle] was first treated as utopian and outright wrong,” Putin noted, adding, “but now it is being realized in the creation of BRICS [loose political-economic grouping of large developing powers Brazil, Russia, India, China and South Africa]” (TASS, November 30, 2016).
 
The possible “strategic triangle” is seen in Moscow as a way for the three major Asian countries to stabilize the continent and limit the purportedly destructive influence of the US. The BRICS economic bloc is seen as a possible precursor to such a “triangle,” and Moscow strongly lobbied for the expansion of the Shanghai Cooperation Organization (SCO) to include India together with Pakistan as another way to move in the same strategic direction.
 
The stakes are high; and if all three “triangle” countries become sanctioned by Washington, the timing could be highly conducive to revisiting the idea again. Reports from Washington that Trump is considering a “swift reaction” to the S-400 contract signed in New Delhi were greeted with enthusiasm in Moscow (Interfax, October 10). If the US follows through and imposes punitive sanctions on India for signing major arms deals with Russia, US-Indian relations could seriously suffer. At the same time, Moscow could doubly gain: first, from multibillion revenues from the arms trade, and second, from the undermining of US influence on the subcontinent that had been steadily growing in recent years.
 
This article was originally published on www.jamestown.org.

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