Boeing Defence India managing director Surendra Ahuja tells Defence.Capital editor N. C. Bipindra that to fully achieve the objectives of ‘Make in India’, the country needs to provide positive incentives to Original Equipment Manufacturers towards investments in the development and growth of the local aerospace and defence ecosystem, expansion and skilling of talent pools, generation of increased employment, and up-gradation of vital technologies.
Ques. The Indian government’s recent reforms in the aerospace and the defence sectors have been quite significant in terms of the 74 per cent Direct FDI norms, the Defence Acquisition Procedure 2020, and the Defence Offset Policy. What are the hits and misses in these policies/reforms for an original equipment manufacturer like Boeing Co.?
Ans. The Government of India’s forward-looking measures are promoting domestic aerospace and defence (A&D) manufacturing. The recent move to allow up to 74 per cent Foreign Direct Investment in the sensitive defence manufacturing sector through automatic route is a welcome step. Along with an enabling policy, the inclusion of forward-looking concepts in Defence Acquisition Procedure (DAP) 2020 such as leasing, post-contract management, introduction of new acquisition category ‘Buy Global (Manufacture in India)’ and long-term sustainment for the entire product lifecycle are some positive steps. The establishment of a contract management Project Management Unit is progressive and will bring execution improvements in the acquisition process. These measures will go hand in hand with the mandate to set more realistic Services Qualitative Requirements (SQRs) for the acquisition of platforms. Additionally, innovative contracting concept of leasing in defence acquisition has introduced fiscal flexibility in upfront capital budget allocation.
The Atmanirbhar Bharat vision requires policies that encourage global competitiveness through financial and technology investments in the Indian supply chain, especially in MSMEs, and by up-skilling India’s labour force in the latest manufacturing and maintenance techniques. To fully achieve the objectives of ‘Make in India’, the country needs to provide positive incentives to OEMs towards investments in the development and growth of the local A&D ecosystem, expansion and skilling of talent pools, generation of increased employment, and up-gradation of vital technologies.
On the offset front, we would request the Ministry of Defence to revert to the wider scope of Defence Procurement Procedure 2016 for discharging obligations. This allows for a holistic development of the Indian A&D sector since there are synergies between defence and commercial aviation.
Further, we would also want group companies of obligators to be allowed to discharge offset obligations across all discharge avenues. Removal of negative multiplier of 0.5X for aerospace component sourcing and increase in multipliers to attract investments would also be welcome changes. I would add that given the connection between space and defence, there is no reason why space collaboration should not be accepted as an avenue for the discharge of offsets.
Ques. Boeing Co. is already the largest American defence supplier to the Indian armed forces since 2007. How would the signing of the four foundational agreements such as the latest BECA between the United States and the Indian governments help the business of Boeing Co. grow and increase its contribution to India’s national security?
Ans. India and the US have made landmark progress to bolster strategic and defence ties, from ‘Major Defence Partner’ to holding ‘2+2 dialogues’ and bilateral and multilateral security dialogues and military exercises. Cooperation in the area of defence between the two governments has grown considerably and we have seen a rise in the number of joint military exercises, technology transfers, collaboration through co-production, and Defence Technology and Trade Initiative (DTTI) for developing and sustaining dialogue between Indian and US industry. The recently signing of COMCASA, and now, BECA permits military operational cooperation and technology transfer at levels that were not possible before. In sum, all these developments are hugely welcome and will certainly permit A&D companies such as Boeing to contribute even more towards capability enhancement of the Indian armed forces.
Today, India is the United States’ eighth largest trading partner, and the trade volume stands at $140 billion. India’s economic aspirations go hand-in-hand with a desire for trade autonomy that is provided by a capable and modernising military to support peace, stability, and a rules-based order in the Indo-Pacific region. This is another point of convergence between India and the United States, as the two countries are increasingly committed to maintaining a free and open Indo-Pacific region. With joint military exercises with India and the US, these landmark agreements will make that cooperation smoother. The stage is set for greater interoperability, where networked assets of both countries can work together seamlessly. At Boeing, we have been proud to deliver the C-17, the P-8I, and the Chinook and the Apache rotorcraft, in support of the Indo-US cooperation. We continue to see additional opportunities in India to strengthen the mission-readiness and modernisation of the defence forces.
Ques. The Indian Navy remains serious about its plans for a carrier-borne combat aircraft for its Indigenous Aircraft Carrier-1 and also for Russian-origin INS Vikramaditya. Boeing Co. had responded to the RFI for 57 carrier-borne combat aircraft issued in January 2017. It is nearly four years now since that RFI. How has Boeing’s campaign for its F/A-18E/F Super Hornet for Indian Navy progressed? Boeing Co. was in August 2020 said to be readying for ground-based ski-jump trials of the F/A-18 to demonstrate the aircraft’s capabilities to the Indian Navy. How have these trials progressed? Have the Indian Navy officials witnessed these trials yet, as there have been travel restrictions due to COVID-19 for a considerable amount of time in 2020? What were the outcomes of these trials and were these convincing for the Indian Navy? What preparations went into Boeing’s effort to demonstrate a ski-jump take-off for the F/A-18 Super Hornet, which has been used under a CATOBAR configuration on the US Navy aircraft carriers that are nuclear powered? Does the ski-jump configuration change the payload carrying capacity of the F/A-18?
Ans. We are engaging with the Indian Navy on their future requirements and have responded to the Request for Information for the Multi-role Carrier Borne Fighter program, MRCBF. This is a very exciting opportunity to partner with both the Indian Navy and the United States Navy. The F/A-18 Block III Super Hornet is the frontline carrier-based fighter of the US Navy, with both the single-seat as well as the two-seat version being carrier compatible. Another important operationally relevant discriminator is that the Super Hornet would prove to be a force multiplier through enhanced networked warfare with other US-origin assets the Indian Navy and the IAF have or are in the process of acquiring. Of no less importance is the fact that the Super Hornet automatically lends itself to enhanced maritime cooperation between the US Navy and Indian Navy in several areas of naval aviation. As part of Boeing’s ‘for India, by India’ philosophy, the Block III Super Hornets can be serviced in partnership with the Indian Navy, US Navy and industrial partners from India and the US throughout the lifecycle of the aircraft. This will further develop advanced expertise in aircraft MRO in India resulting in higher availability of the aircraft at competitive pricing. All these together with the fact that the Super Hornet is the most affordable tactical fighter in its class ‘per hour of operation’ differentiate Boeing’s F/A-18 Block III Super Hornet offer for the Indian Navy. Ski-jump tests for the F/A-18 is a comprehensive test programme that was being undertaken by Boeing in partnership with the U.S Navy. We are excited about the initial results from the trials.
Ques. Will the fleet strength of P-8s in the Indian Navy grow beyond the contracted 12 aircraft? Why? What is the current delivery schedule for the four additional P-8s that were signed for by the Indian Navy in 2016? Would an increased order for P-8s from the Indian Navy also mean more Harpoon anti-ship missile inventory for the Indian Navy? What gives Boeing Co. reasons for its happiness over P-8s performance in the Indian Navy? Is the 2017 support agreement for the P-8s of the Indian Navy being renewed?
Ans. In October, Boeing delivered the ninth P-8I to the Indian Navy under an options contract for four additional aircraft that the Indian Ministry of Defence had signed in 2016. The Indian Navy was the first and is the largest international customer for the P-8 and recently completed seven years of operating the fleet. This aircraft is an integral part of the Indian Navy’s fleet and has surpassed 29,000 flight hours since its induction in 2013. Further, the Indian Navy is ‘delighted’ with the capabilities the P-8I has brought in the domains of maritime surveillance and anti-submarine warfare. In addition to maritime reconnaissance and anti-submarine warfare capabilities, P-8Is have been deployed to assist during disaster relief and humanitarian missions.
Our focus has been, and will be, on delivering the world’s best maritime patrol aircraft to the Indian Navy. We have been supporting India’s growing P-8I fleet by providing spares, ground support equipment and field service representative support. Boeing’s integrated logistics support has enabled the highest state of fleet readiness at the lowest possible cost. We are in discussions for the renewal of the 2017 support agreement. Boeing is currently completing construction on a Training Support and Data Handling (TSDH) Centre at INS Rajali, Arakkonam in Tamil Nadu, and a secondary centre at Naval Institute of Aeronautical Technology, Kochi, as part of a training and support package contract signed in 2019. The indigenous, ground-based training will allow the Indian Navy crew to increase mission proficiency in a shorter time, while reducing the on-aircraft training time resulting in increased aircraft availability for mission tasking.
The P-8I, with its exceptional maritime surveillance and reconnaissance capabilities, versatility, and operational readiness, has proven to be an important asset to the Indian Navy. We do believe that the Indian Navy has requirement for more P-8Is as also more Harpoons and we stand ready to support them.
(To be continued in Part-2 tomorrow)