Saturday, February 26, 2011

Undoing String of Pearls

Strings of Pearls is referred to growing Chinese relations with the South Asian countries such as Bangladesh, Myanmar, Pakistan, Srilanka, Nepal and Maldives. The major player who is trying to undo these strings is India.

India is always uncertain with the growing influence of China in the region.India is a major player is South Asia and trying to become Blue water navy but there is always a chance that China would try to become a hurdle by setting up there infrastructure in the weaker nations such as Srilanka, Myanmar and Bangladesh. This would become a dilemma for the Indian Navy if China makes naval bases in these countries.
India is trying to solve this problem through many ways. Some to my knowledge are listed below:
  1. India is building her own string of pearls. This string would include all the rivals of China such as Japan, South Korea, Taiwan, Vietnam etc.
  2. India is building couple of new naval bases in the East. These naval bases are facing Bangladesh and Myanmar.
  3. India is also trying to gain acceptance from the European nations and United States that she is the best way to stop the influence of China in the future. This aspect is well established and Indian defense deals are exhibiting this perspective.
Japan and India are building major ties in relate to defense. Both countries are finding these relations highly fruitful. Similarly South Korea and Taiwan are all having their grudges against China for various reasons. North Korea is main issue for South Korea and self-sovereignty for the Taiwanese people.
Recently China is in discussion with North Korea to send her troops for the protection for Chinese port facilities. India is worried whether the similar situation will turn out in Myanmar. China is also building railway tracks in Myanmar for the transport of goods from Chinese provinces. This is very important for Chinese growth and would greatly increase military ties between them. Bangladesh recently has signed many new defense deals with China such as purchase of 3 new large fast missile craft and up-gradation of their T-59 tanks fleet to Al-Zarrar standards. There is also a rumor that Bangladesh is opting for J-10 fighter plane.
Sri Lanka call Pakistan and China as their major military suppliers and allies. Pakistan assisted the Government of Sri Lanka in supplying High-Tech military equipment to the Sri Lankan army in the civil war against the Liberation Tigers of Tamil Eelam (LTTE). Srilanka purchased 22 Al-Khalid tanks for $100 million. China relations is growing faster than ever with Srilanka. Latest example was of new Cricket Stadium built with the help of Chinese engineers in Hambantota where Srilanka won by 210 runs against Canada. Hambantota is fast becoming Chinese engineers destination as they are building naval port. China plans to use it as a refuelling and docking station for its navy, as it patrols the Indian Ocean and protects China’s supplies of Saudi oil. The strong point which can lead Sri Lanka to turn for China are aids which has reached to $1 Billion in 2007.
Gwadar is another pain in the ass for India. So this is the time when India is looking for major deals with its own allies such as the purchase of 6 Scorpene class submarines from France and helding competition of well above Rs.42000 Crore for their next generation submarines. India is also involved in building their first indigenous aircraft career and currently buying one from Russia. Not to forget India is also inducting indigenous Nuclear submarine next year. China has a firm ground in South Asia with the likes of Pakistan and Srilanka. Would they be able to create understanding with other nations and gain their acceptance is a major question. Remember economic activities with South Asian nations from India and China will play essential role in winning their hearts.

Thursday, February 24, 2011

Technology Transfers

"Beauties are needed with their blue prints". Lockheed, Boeing, Dassault Aviation, European Consortium(BAE, EADS, Alenia Aeronautica), SAAB and Mikoyan-and-Gurevich(MIG) are all lined up in Asia and other parts of the world but now bids must include upgrading the local industry too. These kind of agreements shows that companies are uncertain about their future sales and they want to secure it.
European Consortium gave such proposal to Saudi Arabia when they accepted Eurofighter Typhoon bid of $4.43 billion for 72 beauties. There are many aspects to look why such proposals are emerging now specially if you consider Saudi Arabia which previously has nothing related to hard mechanical engineering labor stuff. The most obvious reason is competition which has become more and more intensive. SAAB which previously bid only for Swedish Air Force tenders is now actively trying to find more potential markets such as Thailand and South Africa for its JAS 39 Gripen and SAAB Erieye. SAAB previous used most of the technology for its aircrafts from the US and therefore has to pay license and other fees thus cost of the product was too high giving them less chance to compete in market. Other factor was that US often created hindrances in the supply of equipments if her own companies are bidding for the same tender or the purchaser has not good relations with them. Now SAAB are trying to develop their systems independently or with the help of Europeans giving them equal footings to compete for international tenders. Swedish companies are facing high labor cost and to act competitively they need to relocate their major workload to importing countries where the environment is stable enough to expand in local industry and even export directly from other countries. India is becoming one of the most suitable market for this sort of transfers due to her labor intensive industry. When it comes to attaching high tech gears to the aircrafts companies recall the structure back to original plant at home and complete the rest of the part.
French companies in order to get big tenders are now locating their labor intensive work to other countries where not only job opportunities are being created for local industry but employees are also OK with the salaries and benefits they are earning. Dassault Aviation asked for $2 billion to upgrade the Mirage 2000s of India because the production plant has stopped for it and only Rafael are being produced now. To lower the cost of upgradation Hindustan Aeronautics will now upgrade 50 examples locally with the help of Dassault Aviation and only 4 to 6 will be upgraded in France. If Dassault Aviation wins the Indian MRCA competiton it has announced to set his assembly plant in India and work with Hindustan Aeronautics Limited(HAL) in technology transfers similar to the commitments made by SAAB and European Consortium. After all the bid is of $10 billion for 126 multirole fighter aircrafts.
But this is not restricted to India, French companies are coming with the same kind of ideas for other emerging markets such Brazil and Russia. French is actively bidding for Brazilian tender for 36 Multi-role fighter planes competing against Boeing F-18 Hornet. France has also recently signed an agreement with Russia to built her two Mistral-class amphibious assault ships and then further two would be built in Russia with technology transfers.
China is also pursuing the same kind of strategy with the developing countries who could not afford highly costly fighters. China has placed condition that it will transfer technology only if the order is in huge numbers. China made an assembly and manufacturing plant for Egyptian Air Force for its K-8 trainers. Egyptian Air Force is currently looking for a batch of JF-17 Thunder along with technology transfers. These fighters will replace F-4 Phantom and F-5 Freedom Fighters.
This strategy is clearly bringing countries together and also paving ways for the companies to have joint ventures in future which will decrease the risk of huge investment and can result in huge profits if it succeeds. For example Spain and Indonesia joint venture for CN-235 which not only met the requirement of local air forces but also widely exported.

Wednesday, February 16, 2011

Fighter Planes (Asia vs West)

This post is not about war between West and Asia : )
It is related to the technical aspect comparison between Asia and West in the Fighter Planes production. Yeah it may seem that there is very little comparison and West will easily win this aspect but the point is for how long?

Europe may call China a "Duplicator" and India an "Importer" of their technology. It was true if you take it back 7-8 years but the trend is changing and it is changing fast. China surprised western world with their Fifth Generation Stealth Fighter prototype J-20 ''Eagle" they call it. It was not expected before 2020 according to U.S think tanks. Many analyst said that this fighter may be based on the technology of F-117 Night Hawk operated by U.S since 1983. They believe that China has reverse engineered F-117 technology when one of them was shot down by Serbian military during Kosovo War 1999. Every U.S fighter aircraft is built with a kill switch. Besides why would Fifth Generation will be based on something as old ?
( Chinese Intelligence: We have found a shot down F-117 Night Hawk. The Serbians are asking a lot of money but we can manage because we have trillion of dollars in reserve. It will help us in building our 1983 fifth generation fighter and if it does not we will still be having trillion of dollars in our reserves.)

Aviation Industry Corporation of China  (AVIC), a Chinese state-owned company is partnering up with US Aerospace to prepare bids for two US military contracts, including one to replace the aging presidential helicopter fleet Marine One. This is change and this time from Chinese side. 
Around the time, when there was an oil spill in the Gulf of Mexico Obama administration sent a letter to the House of representative about allowing the sales of C-130 Hercules to China to be used for oil spill response operations at Yellow sea. This was surprising because of three reasons:
  1. US will lift a strict embargo on arms sales to China for a C-130
  2. China has a fleet of Y-8s, copy of Antonov An-12 and Y-9 is in developing stages which is called in western media as an imitation of C-130J, the newest version of C-130 Hercules family. This fact must be cleared that Y-9 has nothing to do with C-130s and it is a stretched version of Y-8 with greater payload and range.
  3. China did not even ask request for information (RFI) thus showing no intention for written information about the capabilities of the C-130.
For imitating first you need to have a close look at the THING. It is not happening in this case.

Friday, February 11, 2011

Uncertainity in Asia

Developing nations are currently bolstering there air forces to safeguard their interest. Economic boom in the third world countries such as India are bringing forth new multi billion dollar deals such as MMRCA competition. Those who cannot afford these programs are building up their air forces with the help from the super powers such as in the case of Indonesia buying SU-30s, F-16s fleet upgradation by Taiwan and Pakistan. With all that fire power if one nation takes a wrong move then the entire Asia can suffer the consequences at the time when they are emerging as global leaders.
For example in India there is a growing hype that China is messing with the borders of Arunachal Pradesh. Generals of both armies have made it clear that there is no such activity going on but media is still bursting with stories which portrays a black cloud over there. These stories has led the Indian Air Force to deploy a squadron of SU-30MKI there. China also made a move by building seven foward air bases in Tibet region. All this is going on in a place where there is nothing but ice to walk onto.