Nirmala Sitharaman: ‘Contract committees working at feverish pace, we are pushing them for faster procurements’

Defence Minister Nirmala Sitharaman has been in the news not only due to the Rafale controversy but also for her substantive interactions with her US and Chinese counterparts.

Written by Sushant Singh | New Delhi | Updated: September 13, 2018 7:10:07 am
defence minister nirmala sitharaman interview on china pakistan us comcasa Defence Minister Nirmala Sitharaman in her office, Wednesday. (Express Photo/Neeraj Priyadarshi)

Defence Minister Nirmala Sitharaman has been in the news not only due to the Rafale controversy but also for her substantive interactions with her US and Chinese counterparts. She spoke to The Indian Express about the COMCASA agreement signed with the US, post-Wuhan reset and other issues. Edited excerpts:

During the recent 2+2 meeting with US, India signed the COMCASA (Communications Compatibility and Security Agreement) which had been pending for over 15 years. What led to the change in thinking?

Since our government has come in, there has been effort that India should strengthen its defence cooperation. In the process, in the last two years, there has been a steady build-up while clearly maintaining our balance, in that we have maintained relations with other defence countries, prominently Russia.

India has kept its sovereign independence but with the US, the strategic strengthening but also to build on the relationship that has been built for past two years was taken legitimately forward. In that process, last when Prime Minister Modi and President Trump agreed on 2+2 format, a lot of things started moving forward because it allows for better understanding.

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My meeting with (US Defense) Secretary (James) Mattis when he first came to idea (helped) — he has spent a lot of time building the narrative for India. The difficulties we have, particularly on CAATSA (Countering America’s Adversaries Through Sanctions Act), he has articulated them and we have articulated them. What could have otherwise been a bit of hump in the relationship has moved forward — between the first visit and the second visit of Secretary Mattis we could check on quite a few tangible processes, COMCASA being one of them which was signed now.

What about Basic Exchange and Cooperation Agreement for Geo-spatial Cooperation (BECA), the third foundational pact with the US. Are you going to sign it?

We spoke about BECA in 2+2 dialogue. We have said that we will consider it and we want the language and the text to be given to us. We have only said we are open-minded about it, please share the text with us and we will see what we can do.

After Wuhan, where PM Modi and China’s President Xi Jinping had an informal summit, there has been a reset in India-China relations. How has the border management posture changed for India?

Wuhan has definitely formed the foundation of a positive informal advise, (and) a positive engagement. PM Modi’s speech at Shangrila Dialogue in Singapore also set India’s position in how we see ourselves in this geopolitical strategic landscape. We have heard the Chinese refer to the Shangrila Dialogue speech at various points. You have a lot of articulations about the top leadership itself about what is the spirit of India-China relations. There is a very clear understanding between the two countries about the defence relationship.

READ | Bought only 36 Rafale jets as back-end infra didn’t allow for more: Nirmala Sitharaman

defence minister nirmala sitharaman interview on china pakistan us comcasa Defence Minister Nirmala Sitharaman has been in the news not only due to the Rafale controversy but also for her substantive interactions with her US and Chinese counterparts. (Express Photo/Neeraj Priyadarshi)

(At) the Line of Actual Control, several parts are not yet defined, and there is a difference in perception —- both sides disagree, and periodic flashpoints occur. The frequency of this keeps going up and comes down. But the trend has been that the engagement has been, thankfully, not violent. Sometimes our graziers go into an area which they think is their area and their graziers come into our area. So transgressions keep happening, and I am conscious that our people have been absolutely on the alert.

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The spirit of Wuhan guides all of us. The dialogue that we have had with them is there, and that is appreciated by all — the men and the officers — but when it comes to the actual LAC, these things happen. The only relief is that in the BPMs (border personnel meetings) and flag meetings, they speak.

Whenever I have had a bilateral (meeting), I have said that — and it has moved forward this time that we need to have a hotline, otherwise you lose time after an incident. At least, there is appreciation now that we must not lose time and take a call by a competent authority. There is a positive response and I am hopeful that a helpline at an appropriate level will happen.

Were you surprised that the Nepal Army did not participate in the BIMSTEC military exercise in Pune?

It is not a snub — only recently a person has taken charge (as Army chief). There are some protocol and non-protocol customary things that I am told they do before they get into the nitty-gritty, and these are all fixed. As a result, he (new Nepal Army chief Purna Chandra Thapa) has legitimately excused himself, and I have no reason to disbelieve that. Also, they are still participating at some level. They have a genuine protocol and customary issues, and nothing else here.

defence minister nirmala sitharaman interview on china pakistan us comcasa Sitharaman said: “My meeting with (US Defense) Secretary (James) Mattis when he first came to idea (helped) — he has spent a lot of time building the narrative for India.” (Express Photo/Neeraj Priyadarshi)

Do funds for defence modernisation remain an issue? Even the Army has made plans to reduce 1.5 lakh men so that it has more money for procuring items. What is your take on that?

You have seen the pace at which we are clearing procurements, CNCs (commercial negotiation committees) are working at a feverish pace. We are pushing them hard to get procurements moving faster. I am also looking at it from the perspective of the total expenditure of the government and how much of it is coming to the ministry. What I find missing in this debate is a checklist of, let’s say 20 items built over the last 12-15 years, procurement not having caught up with that incremental change in that list. Would I now complete that list as it stands, or would I say, please look at that list again and re-establish for yourself the requirements?

The committed expenditure for all things between 2014 and 2016 are happening. Last year’s utilisation was very high. Finance is not reducing, on the contrary they are willing to offer more as you ask. I have had two reviews with each of the services about the utlilisation. For example, exchange rate and crude prices — they will definitely have an impact on our budget. We can’t stop import of items and need to make final payments. But finance has told us that it will take care of these two. We are being supported when there is a genuine requirement.

But big-ticket procurement projects haven’t happened – say P-75I or the single-engine fighter deal.

NUH (Naval Utility Helicopter) is cleared – (that is a) major clearance under strategic partnership. Again under strategic partnership, 114 aircraft are cleared and we are looking to give SPQRs (strategic partnership qualitative requirements). I don’t think we are lagging behind. But where we are missing out is, yes, the first two years of this government were spent in assessing, what happened to the defence procurement. You could not really procure anything as you were looking…at the backlog, at what it is operational efficiency which is taking a beating. I am not saying at the time of the previous government, but legitimately, we had to look up and see where is one service as opposed to another, what is our readiness?

So, in a way, I am very grateful to (former Defence Minister Manohar) Parrikar-ji for that — he spent a lot of substantive time, assessing for himself.

The Rafale deal has become a major controversy but one of the unanswered questions is about the government decision to buy only 36 aircraft when four IAF chiefs had asked for a minimum 126 fighters. What was the rationale for buying only 36 Rafale then?

First, buying two squadrons — and I am happy the Air Chief has said (this) I read somewhere today — when there is a desperate need, is not unusual for a quick induction. Every time you induct one squadron, there is requirement for a lot of other paraphernalia. Given a set of parameters, if you quickly want to induct, two is the ideal.

(But) is this the first time? No. The first time was it in 1985-86, when the MiG was bought for the first time, urgently — we got two squadrons. Then Mirages — again two squadrons. If I remember the milepost dates right, 1985-86 once, then the mid-1990s, then again when you were looking at fourth-generation you wanted to buy, it was two squadrons. Even Sukhois, I think, (was) two squadrons.

Air Force technical details will tell you that for any emergency-based induction, it is always two squadrons, and not more than that. So that justifies why you settled for two. Because in ready, flyway condition, that is all you can induct. Otherwise you have to spend a lot more on creating other paraphernalia. Whereas when you wanted 126, what were you trying to get? One squadron in flyway, the rest were being manufactured here. And it was being manufactured here, you have a certain time-line, as per which the IAF could have built the paraphernalia for each one as they came.

At a time for us to procure beyond two squadrons, infrastructure and other things would not have been possible. Therefore we settled for two.

In your first press conference on Rafale, you told me that price and other details will be told by your ministry. Do you now think that it was a mistake?

I asked the defence secretary to give it.

Was it a mistake at that time to say that?

No, not at all a mistake. About the aircraft price, I asked the secretary to give the basic price. I have thought about it, as I have been asked by a lot of people, but I have not answered it. I have thought over it several times. The secretary was before me, much before me in the ministry, and he could tell you much better. And I understand he called you to the room and whatever he spoke to you, he spoke.

Subsequently, we said that whatever could be told has been given in Parliament – (in) November 2016, January, February, and probably March 2018. What is that? It is the basic price arrived at in the basic Inter-Governmental Agreement of September 2016.

I can even repeat it here — I was authorising the (defence) secretary to tell you that. That much I could tell you, so the secretary came only in early-2017, but has been there much earlier than me — a year before me. So that was a conscious decision…I could not have answered, so I made him answer.

When Dassault informs you that Anil Ambani’s Reliance Defence is its offset partner, what response should we expect from you?

Isn’t that a decision of a commercial enterprise to take on its own? I have nothing to do with it. I have not prompted them, not led him, not told them, not instructed them. I have not done any match-making whatsoever. So why am I to be worried by what he would tell me? It may be A, B or C; (or) it may be 70 different partners; it may be buying a product, they may be investing, it may be buying a service. So where am I in it?

How can I tell him (that) you can say this and you cannot say that? Whatever he tells, and claims about obligation fulfilled, I have to hear them out.

Of course, there would be enough checking of vouchers, money spent and all that, as it is in any claim that is procedurally done for anyone who claims that, we will do that.

You recently told the Russians that they can’t make AK rifles in India with the Adani group and must produce them with OFB (Ordnance Factories Board). How does it fit in with your government’s vision of promoting defence manufacturing in the private sector?

There are one or two things that guide any decisions of this kind. This whole thing was something which — I don’t want to use the word propped up — came up during the Defence Expo, and prior to that when I was in Russia. In the process of wanting to have a lot more manufacturing in India, we have always been identifying companies, people, governments, groups, etc.

In Russia, we had asked whether we could have some of these guns manufactured in India. A delegation came during Defence Expo, they met me, (but) I did not talk any details. We sent them back. Then a team from the (Defence) ministry went, (they) spoke and came back. This is not offset — here we are talking about manufacturing. They have to come here and produce.

Now irrespective of who they want to produce with, when it is an inter-governmental agreement for us to have the production done here — and I have the existing capacities for producing guns in India through my OFBs — I would prefer to have them produce it through an OFB. Over and above that, if they want to produce with anybody, I have no issues. But for the first one, I need to have this one…worked out as an Inter-Governmental Agreement, and I am being conscious of that fact that we have established assets in OFBs.

What about private sector manufacturing?

Anybody is free to choose whoever, but when it comes to inter-governmental agreements, I would prefer to do this.

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