An IDC Analysis


New Delhi, 29 November 2006  

Amitav Ranjan and Shiv Aroor had opened a can of worms, in Indian Express, by reporting on India’s DRDO, which also had raised questions in Parliament. The duo tabled  progress cards of DRDO’s military projects for the public to judge, who in the final analysis, was to bear the financial burden for defence. They had demanded accountability and a modicum of transparency.

In his keynote address at MOD’s Defence Economics Seminar held on 15 Nov, India’s Comptroller and Auditor General (CAG), V N Kaul who has fiduciary responsibility for DRDO’s spending, indicated that India’s DRDO was not subject to transparent external audits. Other speakers suggested that DRDO should no longer hide behind veils of secrecy for its projects but should devise methods which permitted CAG to maintain confidentiality when it is essential. Regrettably it is a fact that many large projects that DRDO  undertook have not fructified and have witnessed questionable time and cost over runs.

Nine years ago Navy Chief Vishnu Bhagwat demanded an audit of India’s hugely expensive Advanced Technology Vessel (ATV) nuclear submarine project, but he was sacked for fear of exposing details of the still classified project. This has deterred others from raising the issue of a performance audit, and DRDO’s projects have become holy cows, but it is a fact that scientists are known to be poor project managers.

The somewhat over critical assessment of the DRDO by IE is an opportune issue for debate. The country’s manufacturing sector has matured with capable capacities and investment in foreign factories, and so there is scope for them to take on some DRDO tasks. With a slight change in practices and collaboration with local and foreign industry, and insertion of technology, the concatenation of production facilities, talents and well equipped laboratories that DRDO has built up, can now deliver better.

If the recently instituted mandatory 30% MOD offset policy in imports of over Rs 300 crores, is extended to include high end defence technology, another wide window of opportunity can emerge. India is an attractive and leading defence importer of $5b per year. MOD has sorely missed the bus, by not including offsets in the massive $4b Scorpene deal. Such a step would have been in India’s national interests, though some overruns and failures in research projects will have to be accepted, as this is a world wide phenomenon.

There exists yet another serious lacuna in India’s higher defence setup. There is no single accountable Commander in Chief, and it is the diffused Cabinet control method of responsibility, scripted into article 75 of the Constitution that ensues. Hence not much attention is paid to this vital subject by the busy Prime Minister, who leaves it to the MOD and invariably a junior Minister is placed in charge of DRDO. Even in Japan which is a bicameral democracy like ours, the Prime Minister is constitutionally made accountable as the C in C for all defence matters.

In India only the ATV and nuclear projects are under the PMO. In UK which does not have a written constitution, the PM is accountable. To exacerbate the situation the three Armed Forces Chiefs are autonomous, and the Government has not even specified the core competencies of each service leading to duplication in many defence spheres like UAVs, helicopters, missiles, special forces, anti air defence and EW, which had proved more challenging and expensive for DRDO to manage individual needs. The QRs setting methodology for common equipment and doctrines, are also varied. The obvious benefits of economies of scale and standardisation are also precluded.

It was therefore interesting to read a young America returned MP Milind Deora’s views in an editorial page piece on 21st Nov on the management of DRDO. His piece began with a laudable recommendation to emulate the US DARPA model, which is a purely R & D and design agency, unlike DRDO which took upon itself to become a manufacturing agency, for which it was not qualified. That set Parkinson’s ‘law of expansion’ into motion, so we have a high scientist to tail ratio. This may have been fait accompli in 1958, as Indian industry could not have taken up the challenge of production like USA’s huge industry did, and our needs in number of systems were limited. FFE was short and policies of indigenization and import substitution, were the credo.

Changes are now possible as Indian defence industry led by Larsen and Tubro, Tatas and Kirloskars as examples, have matured but it will also require that India’s archaic Officials Secrets Act, 1923 be revised to make civilians privy and accountable for classified data. DRDO needs to stop reinventing the wheel and farm projects to industry in the food, IT and communication sectors and shed laboratories that are no longer functional or cost effective. The Services also need to monitor the projects from an ab initio stage.

All this is very easily said but it was Ernest Hemmingway who insisted that journalism is the end of a good cause. This requires political will. Yet in defence of DRDO, much has been achieved in India’s nuclear arena, ships, avionics and sub systems and some strategic fields, so all is not lost. In many ways the DRDO of India is a reflection of most of India’s government organizations and loss making PSU’s of days gone by. Many DRDO labs became unwieldy structures, were poorly managed with no checks or balances and with political influences, not to mention the arms dealers lobbies that operate in India and offer sops to politicians and encourage imports and decry indigenous projects.

The decision to make Prithvi a liquid fuelled missile which is now being corrected in Prithvi-III was taken to ensure employability for the many scientists and workers employed in the field at Hyderabad. It is no wonder the DRDO failed to deliver on many of the projects except those that were closely monitored especially by the Navy. The improvements and resurrection of the SU-30MKI from a old SU-27 is an example. The Navy has a unique Weapons Electronics and Engineering Establishment, WEESE, at Delhi which is a mini DRDO in itself, silently audits and assists DRDO projects and shipyards, while Navy’s design bureau with 50 years of experience and 300 naval constructors has contributed. The Navy also insisted that production after design, should not be entrusted to DRDO or Ordnance factories, as that combination can be very difficult to manage professionally for any project.

Some DRDO heads have also behaved like satraps under the veil of secrecy, and built a slew of 39 lavish laboratories all across India along with laudable infrastructure and now possess a most imposing HQ in New Delhi, that we can be proud of. The DRDO has recruited a bevy of scientists who are exposed to modern technologies and some of them have done remarkable work in the guided missile, sonar and electronics fields, while others including deadwood passed on from the services have whiled away their time, as promotions are mainly time bound. Earlier western technology was consciously denied to DRDO because of sanctions, but these are lifting. The services must admit they failed to constantly monitor, guide and spoon feed projects like the Arjun MBT, the 7.62mm INSAS rifle and LCA but came in at the preliminary trial stages, with criticism. This lesson seems to have been learnt.

Finally, the temples the DRDO has built can now be restructured for projects to come alive. If the LCA which already has the GE-404 engine gets the MIG 29 multimode radar and weapon suites amalgamated from the foreign supplier of the 126 fighter contract, like Sweden’s SAAB did for Gripen with BAE, the LCA may still meet its target. Singapore had seen LCA’s potential and seriously offered investment and joint design and production in 1990, but DRDO was insistent the production would be only in India and we missed an opportunity. Such overtures can be revived, as the LCA has a good level of flying technology with many unique features. Only fresh management can bring the escalating costs down. The wheels that DRDO has invented can certainly be repolished and made to revolve easily. It’s the will that is needed and India is no longer the pygmy it was, when DRDO was formed in 1958.

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