India Likely To Put On Hold Purchase Of Japanese Plane
16 April 2016
Sale of 15 US-2i (Utility Seaplane Mark 2) amphibious aircraft from ShinMaywa Industries, Japan, to India is unlikely to materialise soon as the Indian Navy, the end user, finds it overpriced and not of immediate requirement.
Both the countries recently inked an agreement to facilitate export of the amphibious search-and-rescue (SAR) aircraft to India. The deal is estimated at $1.65 billion.
Japanese defense minister Nakatani is expected to visit India early next month and discuss with defence minister Manohar Parrikar as well as senior Navy officers the status of the sale plan, which has been in the pipeline for the past few years.
The visit coincides with the expected meeting of the Defence Acquisition Council under Parrikar. According to sources, US-2i is on the agenda of the meeting.
Sources in the ministry of defence (MoD) told FE, “ Right now, the US-2i is not the immediate requirement of the Indian Navy which is the end user. Also, after several round of discussions between two sides, costs are not in line with what the Navy anticipated.”
“While there have been visits by Indian Naval officials to the facilities where the amphibious aircraft is being produced, it seems that Japan too is weighing its decision to export the aircraft to India without violating its self-imposed defence export restrictions,” sources said.
Even if the acquisition gets through, it will be aimed at preventing leak of Japan’s technology – not allowing India from transferring the equipment or technology to a third-party without Japan’s consent.
Both the countries had once discussed the possibility of India being permitted to assemble the aircraft indigenously, giving it access to Japanese military technology. In fact, Japan has also offered to set up a manufacturing base in India under the ‘Make In India’ plan.
Since Tokyo eased its nearly half-a-century ban on defence equipment exports in April 2014, Japan and India have accelerated talks over India’s possible purchase of US-2i amphibious aircraft.
The deal is significant for a variety of reasons. On the surface, it’s another indicator of burgeoning cooperation between India and Japan on security matters. The deal is doubly significant in the context of India’s relations with Japan because once India clinches the deal, it will become the first country to purchase defense equipment from Japan since the latter’s self-imposed ban on defence exports began in 1967.
The deal is important for Japanese Prime minister Shinzo Abe as it would open up Japan’s defense industry to additional contracts with foreign partners.
According to Japanese officials, the proposed sale of US-2i amphibious, fixed-wing aircraft would not infringe upon Japan’s self-imposed ban on arms exports because the aircraft to be given to India will be unarmed and can be used for civilian purposes.
The plane could be used for firefighting or as a kind of amphibious hospital and costs around $110 million per unit. The plan is to deliver two aircraft and then assemble the rest with an Indian partner.
Source : financialexpress.com