Publication: Monitor Volume: 7 Issue: 68

Indian Vice Admiral Arun Prakash’s statements yesterday give further credence to earlier reports that the long and difficult negotiations between Russia and India which preceded the signing of the recent defense deals were caused at least in part by confusion and a lack of professionalism on the Russian side. That these sorts of problems have still not been fully resolved, moreover, was suggested by a Russian press report published last month which stated that the US$600 million (some Russian reports have put the value as high as US$800 million) Russian-Indian tank deal could yet fall apart. According to Vremya Novostei, Sverdlovsk Governor Eduard Rossel complained at a March 13 meeting of regional defense enterprise heads that many suppliers of the Uralvagonzavod production plant–which is assembling the T-90 tanks–are currently in no position to provide the required parts and components for so large an order of tanks. According to the news report, suppliers of Uralvagonzavod from Magnitogorsk, Izhevsk and northwestern Russia were not even aware that they were participants in the Indian-Russian tank contract. And even the Uralvagonzavod plant itself is reportedly facing difficulties. According to the news account, plant representatives are scouring local villages (and even jails) in an effort to find skilled metalworkers. Rossel reportedly suggested that the many problems could doom a project that is critical to the future of local defense plants and that they have been hoping to finalize for some five years (Vremya Novostei, March 14).

Adverse findings by Indian investigators into the Russian-Indian arms deals, or an inability by Moscow to fulfill its obligations under currently existing arms contracts, could have serious repercussions. India has emerged as one of Moscow’s most valued diplomatic partners, but the relationship between the two remains in many ways one-dimensional, based in large part precisely on these arms dealings. The deal is also critical from a domestic Russian standpoint, both insofar as it promises to inject large amounts of cash into a troubled Russian defense industrial sector, and because serious difficulties in this area could reflect back on the Kremlin itself. Putin launched a major restructuring of the country’s arms export apparatus in November of last year, and it is people he placed in top management positions who were presumably responsible for finalizing the recent Indian-Russian defense deals. Serious setbacks in this area could therefore turn into an embarrassment for the Russian president at home.