Private Sector

Modi’s Military Purchases Remain a Pipe Dream for Lockheed, Saab

Global companies from Lockheed Martin to Sweden’s Saab AB are offering military hardware from submarines to helicopters to Prime Minister Narendra Modi’s government as part of his $250 billion defense modernization program.

But bureaucratic delays and a funding crunch has made future deals next to impossible. Airbus SE won a $1.7 billion contract to supply transport planes to the Indian Air Force in 2015 — it’s first military agreement in the South Asian nation since 1962. Five years later, that deal is yet to be signed.

India’s inability to speed up the modernization of its weaponry to guard the border with arch-rivals Pakistan and China shows the Modi-led administration’s challenge to transform an industry plagued by red tape. While New Delhi is the world’s fourth-biggest military spender, its air force, navy and the army are still equipped with weapons that are largely obsolete.

“The defense procurement procedure needs major, thorough reforms, not just an update,” said Jon Grevatt, the Asia-Pacific defense industry analyst with Jane’s, adding the complex approval processes and lack of finances are the main drag on military modernization. “Unless the Modi government really introduces major reforms into its procurement process then we will continue to see delays.”

No Orders

An air of despondency hung over the gathering of top arms manufacturers last week in Lucknow, a nineteenth century battleground city in northern India.

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