An IDC Analysis


New Delhi, 22 November 2003

The Indian daily which had exposed the Bofors papers many years ago, reported on 20th November that the Gorshkov deal is to be sealed by the end of the month with some “ifs and buts”, when Russian Defence Minister Sergei Ivanov visits New Delhi on 27–28 Nov. All indicators from statements in the media and Defence Secretary Ajay Prasad’s rushed weekend visit to Moscow and other indicators emanating from PM’s Russia visit, were similar to those we saw for the AJT deal, which came about in the same fashion, after three weeks of similar statements. Inputs must be leaking like sieves, as many people may be involved in discussions and the typing of the mega deal –– which can be kept secret in services HQ, but not so easily in the bureaucratic domain.

If this billion dollar deal comes through as the paper predicts, it is great news for the Indian Navy which celebrates it birthday on 4th December. This year there will bigger surprise celebrations by architects of the 1971 Victory, besides this birthday gift. Five Indian Navy ships are presently off China and Singapore and in the Pacific –– that should tell Indians something. The Navy brasses appear to be on a total high!

India needs the Gorshkov for the security of the Indian Ocean and India’s future, and even today we support the “never too late decision” to get the Gorshkov, and fit it out with MiG 29Ks and Ka 32 AEW helicopters. There was no other choice since inter-service opposition delayed our own Air Defence Ship (ADS), which too awaits the Gorshkov aircraft choice. So lets get on with it.

The Navy has a fine aviation wing with traditions equal to if not better than the Indian Air Force. The ‘world’s need for Indian Ocean maritime security is paramount, especially today’. Admiral Dennis Blair, C-in-C Pacific said that in 2001 and goaded the Indian Navy to get involved –– which it did post 9/11 in the Malacca Straits, though this annoyed Malaysia’s Mahathir.

Terrorism and piracy at sea can cause greater damage to the world economy than the WTC bombings of 9/11. The Sea Lines of Communications (SLOCs) of the Indian Ocean carry 60% of the world’s trade and energy resources. The choke points off Aden in the Straits of Bab El Mandeb, Hormuz in the Gulf and Malacca between Singapore and Indonesia, are crucial.

India’s stake in world trade is only 1% compared to China’s 7% and Japan’s 12%. If two or three 400,000-ton VLCC tankers bound for Japan or China were to be blown up (quite easy for trained Jehadi seamen), then the world stock market would crash and insurance rates would soar. Oil prices would rise and we do not have to explain the consequences for India.

India juts into the Indian Ocean and we have duties to perform and we have offshore assets to protect and 1000 islands and 7500 km of coastline. Rightly so the Indian Navy’s long term planning is for a navy of three carrier battle groups.

It is relevant that a former Chief of the Navy had opposed the purchase of Gorshkov by his outpourings in He put up cogent reasons of costs and his views are appended below for those who wish to recollect. This only makes our assessment more relevant and we hasten to say that the nation needs to afford the Gorshkov. It can, as the money will be spent over three years. The experience we gain will help us fit out our own ADS and we will be able to assist  the IAF with the MiG 29K facilities.

If Gorshkov is sealed before 4th December and the 6 Scorpene deal moves ahead these will be the best birthday gifts the nation can give itself and its Men In White.


The Indian Navy's White Elephant

By A Former Indian Naval Chief on 19 Nov 2003

You have recently completed your bungalow and are on the lookout to hire some people for security. Pandu chowkidar has agreed to do the job along with his friend for about Rs 2,000 a month per person. But your good friend who has a security business steps in. Don't waste your money, he says. I have a surplus of these people. I can give you a couple free. But what about some electronic fencing and surveillance cameras? Before you know it he has sold you equipment worth a couple of lakhs.

India's imminent purchase of the Russian aircraft carrier Admiral Gorshkov comes pretty close to this illogical purchase.

A little background first. The Gorshkov is one of four carriers built by the erstwhile Soviet Union during the Seventies at the height of the Cold War. The first three, the Kiev, the Minsk and the Novorossyisk, saw operational service in the Soviet Navy during the late Seventies and the Eighties.

When the Cold War ended the Russians no longer could sustain a fleet with so many carriers and they were all sold for scrap in the early Nineties.

The Gorshkov, earlier called the Baku, was the last to be completed and did not become operational until 1986. Her operational career was cut short, however, when a devastating fire crippled the ship. Although she was repaired, the Gorshkov never saw operational service thereafter.

In the late Eighties, the Indian Navy began to look for options to replace the ageing Vikrant and Viraat. The original idea was to build one in India. Various actions were taken towards that goal.

Apparently wanting to get into the act, the Russians offered the Gorshkov to the navy in 1994. The purchase had many difficulties. The ship was far bigger that what the navy was looking for. At 45,000 tons and with a deep draught, the ship was not capable of entering Mumbai harbour, which was the logical place for basing it if the navy wanted it primarily as an air defence ship for the Western Fleet.

The navy also did not have adequate facilities to carry out major repairs. But though the price was more than ten times what the navy had paid for the Viraat, it was still worth consideration at Rs 1,000 crore. Many in the navy were for the deal.

But when the navy dilly-dallied, the Russians hit upon a new gambit. We will give you the carrier free, they said. Just take it away and do what you want with it.

Naval eyes lit up at the word 'free'. When the navy and defence ministry were truly and properly hooked, the Russians slowly let in the rider. You will, of course, need to modify and refit the ship for use in India. We will do it for you. It will only take a couple of years and cost you Rs 3,000 crore.

And of course you will require a squadron or two of our latest carrier-based fighter, the MiG 29K. Cost? Another 6,000 crore. Thus the total cost of this rather doubtful acquisition is anywhere between Rs 6,000 crore and Rs 10,000 crore.

In his first term as India's defence minister, George Fernandes promised to bring in greater transparency in India's arms deals. Yet these remain as opaque and unfathomable today as they ever were. No one can make head or tail out of the Gorshkov purchase. Why is a poor nation so intent on seeing through this exorbitant deal? And where is the Indian Navy, with an annual budget of only 3,000 crore, finding the money to pay for all this? Can the job not be done much more cheaply?

Not getting the right answers to these questions, the general belief is that there is something fishy about the whole deal. Recent deals with Russia, including the Rs 6,000 crore Su-30MK deal and Rs 4,500 crore frigate deal, have all been subjects of controversy. None of these deals has been adequately explained by the government.

There is no doubt that the Indian Navy requires a carrier. It needs it to defend its fleet on the high seas against air strikes. Anti-submarine helicopter patrols and strikes against surface targets are added bonuses, not necessities.

Are there reasonable alternatives? Of course there are. The requirements of the navy can be met by a small, 20,000 ton air defence ship. Indeed, the government has placed an order for just such a ship with the Cochin Shipyard. A Spanish yard will build such a ship for about Rs 3,000 crore. The Koreans will build a utility carrier by modifying a merchant ship with a flattop for Rs 500 crore and deliver it in 18 months. Getting the Gorshkov to do the job is like using Schumacher's F1 Ferrari to do your weekly shopping.

The purchase of the Gorshkov at this price will also bring many other headaches to the navy. Apart from the basing and refitting problems, there will be operational problems. No naval chief will ever be willing to risk such a high-value ship in the Arabian Sea in any conflict with Pakistan. Karwar will not be ready for another 10 years and basing the Gorshkov on the east coast will create other difficulties.

In today's charged atmosphere, a conflict can erupt at short notice and be over before the mighty Gorshkov arrives to deliver her punch. The purchase will also require the navy to mortgage its capital expenditure for the next several years. Indeed, it will be a millstone around the necks of the next two chiefs.

Viewed from all sides, if the prime minister inks the Gorshkov deal during his visit to Moscow, it will be the most illogical purchase ever between India and Russia.

With the Indian economy in the doldrums, or at least not as bright as it once was, the last thing we want is a profligate armed force. The Indian Navy cannot expect the nation to give it everything it wants at the cost of the nation's economy. Alternatively, the navy has to live within its budget. Cheaper alternatives to the Gorshkov must be considered.

Traditionally, naval ships have been painted a shade of dark gray. If the Gorshkov is purchased, the Indian Navy might make an exception and paint the ship white. For the aircraft carrier is bound to be the biggest white elephant in the navy's fleet.


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