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India’s Aerospace and Defence Market has Tremendous Growth Potential

Dennis Swanson - Director /  Business Development  Executiive Portrait & passport Photo 4/21/2011 Favorite:  MSF11-0042-15 RMS# 204506

Mr Dennis D. Swanson is vice president, International Sales, Boeing Defense, Space & Security and Boeing Global Services, and is co-chair of the US India Business Council mission to Defexpo 2020. He shares his perspective on what is driving successful India-US defence trade relations and the areas for potential collaboration in the future.

Q. There has been significant momentum in U.S-India defense trade. What is driving this relationship?

A. There is extraordinary growth potential in US-India defence trade and on the defence-industrial partnerships front. We welcome that as an industry body. The opportunity is also as clear as the growth trajectory that has taken US-Indian defence trade from a mere $200 million in 2000 to over $18 billion in 2019.

As one of the fastest growing economies in the world, India offers growth and productivity opportunities for the aerospace industry. All the US companies that are part of this USIBC mission to India recognise that aerospace is a global industry and that we must continue to tap into the talent, innovation and technology in the US, India, and around the world to deliver high performance and affordability our customers expect. The investments made by US companies in India in defence partnerships or investing in the manufacturing, skill development and engineering footprint in India is critical to our industry’s long-term ability to sustain and grow jobs here in India and the US.

Over the last 10 years, we have seen great positive energy and strong participation across our governments. An expanded partnership between the United States and India allows us to create greater prosperity for both our nations and stand as mutually reinforcing engines of growth and innovation.

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Defence Minister Rajnath Singh on board USS Dwight D. Eisonhower at Naval Air Station (NAS) Norfolk, being briefed about the capabilities of F/A18 Super Hornet in Air and Naval operations

Q. Can you comment on doing business in India and the role that Indian companies play in the aerospace and defence sector?

A. We’ve seen the ease of doing business improve significantly under Prime Minister Modi’s government and we welcome that. You see a lot of US aerospace and defence companies investing in India and partnering with industry as a result.

We’re seeing a lot of positive momentum on designing, engineering and manufacturing in defence as well as a commitment to co-development and co-production as also, on tech transfer and releasability to offer advanced capabilities to India and partnering with India.

India’s aerospace and defence market has tremendous growth potential and strong fundamentals to be globally competitive and develop into a leading hub and net exporter for design, manufacturing, engineering, technology development and services.

Indian companies – both in the public and private sector – are adopting global standards when it relates to quality, efficiency and cost competitive benchmarks required for the aerospace and defence industry. They are also making the investments required for this industry and partnering with the right partners to build scale and capacity and develop talent to export defence products and services globally. As a result, they are becoming an integral part of the global aerospace supply chain.

Q. You have talked about relations with India enjoying bipartisan support in the US. Can you elaborate on that?

A. Defence cooperation between the two governments has evolved considerably in the last few years, driven by the growing convergence of American and Indian defence interests. At the international geo-strategic level, this convergence is occurring primarily because of the shifting balance of power in Asia. We are encouraged by the growing defence relationship that has expanded under all US administrations and continues to grow under the Trump administration.

Secretary of State Pompeo along with President Trump and Vice President Pence have reaffirmed US recognition of India as a “Major Defence Partner” and a commitment to offer India defence technologies on par with America’s closest partners and allies. Of note, in 2017 the Trump administration modified the Export Administration Regulations to facilitate defence trade with India and provided an unprecedented offer of Missile Technology Control Regime Category I Unmanned Aerial Vehicles to the Indian Navy. In 2018, further progress was made through the granting of India as a “Strategic Trade Authorisation 1” country and by the joint signing of the Communications, Compatibility and Security Agreement (COMCASA), which was over a decade in the making.

More recently, the Industrial Security Agreement (ISA) was signed during the 2+2 Dialogue which facilitates close technology transfer with the Indian private industry. The ISA, along with other foundational agreements such Logistics Exchange Memorandum of Agreement (LEMOA), and joint exercises between the two militaries, furthers bilateral industrial and military cooperation and elevates India’s emergence as a stronger strategic partner.

In India, Prime Minister Narendra Modi’s leadership holds promise for greater US-Indian military and industrial cooperation. We welcome his commitment to “Make in India,” and offer our strong support through joint partnerships and investments to make it a success.

Q. What opportunities do you see for collaboration in the defence and aerospace industry going forward?

A. In considering US-India defence trade, it’s important to recall that the US-India defence relationship is a young relationship. The first Defence Framework Agreement was not signed until 1995 and concrete steps towards cooperation weren’t firmly set until the second Defence Framework Agreement in 2005. It was only around that time that defense cooperation in armaments became possible through agreements on information exchange and research, development, testing and evaluation.

It therefore makes it remarkable that India’s strategic and theatre transport fleet, its heavy attack and heavy lift helicopter capability, its long-range maritime patrol aircraft and anti-submarine aircraft, and its howitzer capability are all US-origin equipment. And offerings involving unmanned aerial vehicles and fighter aircraft worth tens of billions of dollars are now being actively discussed. You also see increased cooperation in areas such as joint military exercises, technology transfer, collaboration through co-production, Defence Technology and Trade Initiative (DTTI) and the renewal of the defence agreement for another 10 years by Congress. You also see US industry partnering with the Indian ecosystem. The Boeing and Tata joint venture that is building AH-64 Apache combat helicopter fuselages in Hyderabad, Tata Lockheed Martin Aerostructures Limited building C-130J empennage assemblies are examples.

Maritime security in the context of the military-to-military relationship has significant potential now and in the future. It offers the surest foothold to advance the broader security agenda and realise the value of being Major Defence Partner in the near-term. The Malabar military exercises and the revival of the Quadrilateral Security Dialogue (the Quad) are a natural fit for collaboration. Efforts such as the utilisation of the P-8 fleet for missions in the Indian Ocean region; collaboration and engagement via the DTTI Carrier Working Group (exchange of ideas related to carrier ops and the potential for consulting on future design); and strong potential for Boeing’s F/A-18 Super Hornet for the Multi-Role Carrier Borne Fighter requirement and transition from Russian fighters would be steps in the right direction.

Technology releasability is another area with potential for increased cooperation between the US and India. Support from the US government on concluding enabling agreements is important, as is continuing to lean forward to offer advanced capabilities and support for some of the Make in India solutions India is requesting.



Source: India Strategic
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