INS Vikramaditya: A Highly Questionable Symbol
of Friendship
Major General Mrinal Suman
A banner
displayed prominently at the handing over ceremony of INS Vikramaditya (earlier
called Admiral Gorshkov) in the Russian
city of Severodvinsk on 16 November 2013
read – “Vikramaditya: Symbol of India-Russia Friendship”. Most knowledgeable
observers must have marvelled at the acerbic sense of humour implied in the declaration
and struggled to hide their sardonic expression.
Vikramaditya
is anything but a symbol of friendship. Friends do not renege on contractual
obligations, friends do not violate sovereign promises, friends do not mislead,
friends do not cheat, friends do not exploit and friends do not arm-twist. In
fact, Vikramaditya represents narcissistic attitude of the Russians and supine
capitulation of the Indian government.
A short background will be in order here.
India’s sole aircraft carrier INS Virat was due to retire in 2007 and the
indigenous aircraft carrier was scheduled to be completed not before 2012. India
was, therefore, on the lookout for an aircraft carrier to fill the gap.
Russia offered the 44,500 ton Admiral Gorshkov, a decommissioned hybrid
carrier/cruiser lying in hibernation since 1995. It was to be a free gift from ‘one
friend to another’. However, India was required to pay for its refurbishment.
As an integral part of the package deal, India was to purchase 12
single-seat MiG-29K 'Fulcrum-D' and 4
dual-seat MiG-29KUB aircraft, 6 Kamov Ka-31 "Helix"
helicopters and other equipment.
Originally laid as Baku in 1978, Admiral Gorshkov was launched
in 1982 and commissioned in 1987. The ship has been dogged by misfortunes since
its conception. To start with, major software bugs in the new command and
control system delayed its completion. Thereafter, a boiler room explosion
caused considerable damage in 1994.
Three
different delegations of the Indian Navy had visited Russia to inspect the
decommissioned ship in 1995, 1998 and 1999 respectively. They indicated that
the material condition of the ship was deteriorating rapidly and the state of
machinery/systems on board had worsened to that an extent that most required
replacement/refit rather than repairs.
After nearly a
decade of negotiations, the deal was finally signed on 20 Jan 04 and the
effective date of the contract was established as 24 Feb 04. Refurbishment cost
of the carrier was negotiated at $947 million. The refurbished carrier was
contracted to be delivered to India within a
period of 52 months, i.e. by August 2008.
Repair and Re-equipping (R&R) work was to be carried out at the government owned Sevmash
shipyard in the Russian city of Severodvinsk. The work started with due diligence. However, it was soon
realised by the shipyard that the scope of work had been grossly under-estimated.
Large portions of steel hull, entire length of cable, motors, turbines, boilers
and other facilities had to be completely replaced or re-fabricated. For
example, 1750 compartments out of a total of 2500 had to be re-fabricated/re-configured.
In November 2007, Russia shocked India by raising a demand
of $2.9 billion for the ship, (three times the contracted cost) and sought
deferment of delivery by additional 52 weeks. India was understandably dismayed but found
itself in a tight corner with no leeway whatsoever. After months of bitter
negotiations, both sides agreed to a revised price tag of $2.35
billion on 10 March 2009. New delivery date was shifted to end-2012.
Sea trials
began in Russia’s White Sea in June 2012. However, they had to be called off prematurely
in September 2012 due to multiple boiler failure – seven out of eight steam
boilers of the propulsion machinery became out of order. Consequently, the
delivery deadline had to be extended by another year.
It was no wonder that Defence Minister
Antony heaved a sigh of relief on finally receiving delivery of INS Vikramaditya
on 16 November. He was candid in admitting that the deal had nearly failed. The Naval Chief termed it as a result of
exceptional perseverance.
The Russian Stratagem
The Russians deserve credit for managing the whole process
in a highly ingenious and well thought-through manner. Enormity of their
stratagem can best be illustrated by recalling major developments in a
chronological order:-
a) After the break-up of the erstwhile Soviet Union, Russia
found accident-ridden Admiral Gorshkov to be too expensive to be maintained. A
decision was taken to do away with it in 1994-95. With no resources available
for mothballing it scientifically, it remained uncared and derelict. As breaking
up of a ship is a costly proposition, Admiral Gorshkov’s fate remained
undecided.
b) It was at this opportune time
that Russia became aware of India’s search for an aircraft carrier to bridge
the expected gap during the period 2008-13. With a view to make the package
irresistible, it cleverly sugar-coated the offer by making a free gift of the
ship and charging only for R&R, thereby generating much needed work for its
shipbuilding industry which was in deep recession. Notwithstanding the fact
that the deal was linked to India’s procurement of MiG-29 aircraft, India found
the offer to be too good to be declined.
c) Russia skilfully tailor-made its
offer to suit India’s requirements. As a brand new aircraft carrier would have
costed around $2.0 to 2.5 billion in early-2000, Russia agreed to charge only $947 million for complete R&R package, considerably less than the
prevailing cost of a new carrier. Moreover, Russia promised to deliver it by
August 2008, thereby meeting India’s requirements ideally. No wonder then that India
accepted the offer enthusiastically.
d) Although Sevmash shipyard had neither built/repaired ships of this size nor possessed any work
experience of working on aircraft carriers, R&R work was
assigned to it. It was a subjective decision as Sevmash had little work at hand and needed orders urgently to avert
bankruptcy. As pointed out by the Controller and Auditor General of India (CAG)
in its Report 18 of 2008-09, the shipyard’s total revenue was $81 million in
2004 when it was loaded with the Indian contract worth $875 million. Worse, Sevmash
enjoys poor reputation. It is notorious for reneging on contractual
commitments. Norwegian firm Odfjell was forced to cancel a $544 million
contract to build up to 12 tankers, allegedly for serious delays and demands
for price increase.
e) Russia is claiming that it underestimated the total
scope of work initially. It is hard to believe that Russia did
not know the full scope of the work involved. For example, to claim that most of
cable was expected to be usable in a ship with rotting hull segments is sheer
baloney. Russia knew right from the beginning that both the cost and the time-schedule
were totally unrealistic propositions. In any case, it had no intentions of
abiding by them.
f) Once India had swallowed the bait, signed the deal and
released part payments, Russia decided to spring a surprise. R&R work on
the ship commenced on 09 Apr 04. Even if Russia had underestimated the work
initially, it would have realised the actual scope of work by the year end.
However, it cleverly chose to remain silent till November 2007. Just 10 months
before the scheduled delivery date, it raised claims for additional cost and extension
of delivery date. Perhaps, there is no other example of such unprincipled and deceitful
breach of contractual commitments in international arms trade.
g) Absurdity of
demand for additional price can be gauged from the fact that the cost of sea
trials was increased from the contracted $27 million to $522.57 million, an
escalation of close to twenty times. It is not understood as to what new
unanticipated factors had crept in to justify such an astronomical increase. It
shows dishonest and devious approach.
h)
Russia had intentionally waited till end-2007 to be in a position to blackmail
and arm-twist India. As India had become complacent after signing contract with
Russia, it had not explored any alternate option to acquire an aircraft carrier
in the required time-frame. With the scheduled retirement date of INS Virat drawing
uncomfortably near, it became anxious to acquire INS Vikramaditya. Thus the timing
was perfect for Russia to deliver the unexpected blow and exploit India’s
desperation. It even threatened to cancel the contract.
i) While demanding that
the deal be re-priced at an outrageous figure $2.9 billion, Russia shrewdly
announced that it was willing to compensate India for the increased cost of
Gorshkov if it got more military orders. It was blackmail
at its worst, that too by a much proclaimed friend. India was finally coerced
to shell out $2.35 billion for the carrier ship. Concurrently, in a linked
deal, India had to place order for additional 29 aircraft MiG29K for close
to $1.2 billion. It is difficult to estimate the quantum of cost of
Vikramaditya that Russia has defrayed by hiking the outlay for aircraft and
other equipment.
It is being claimed that since 1750 of 2500 compartments have
been completely re-fabricated and a total of 234 new hull sections (using 2500
tonnes of steel) installed to achieve
the desired shape, almost two third of the ship has been renovated. Russia is
claiming that the ship will have a service life of 30-40 years instead of 20
years as estimated earlier. Indeed it is a laughable premise.
It is a
common saying that a chain is as strong as its weakest link. Similarly, service
life of Vikramaditya will not be determined by 234 new hull sections but by the
state of 30-year old hull sections installed in 1978. It must also be
remembered that the ship was lying unmaintained in a state of total neglect for
10 long years from 1994 to 2004.
Indian Ineptness and Capitulation
Whereas Russia handled the complete
contract in a highly skilful manner, the same cannot be said for India. If
India let Russia take it for a ride, the fault lies with the inept India
procurement regime.
Despite repeated assertions that single
vendor procurements should be avoided, India banked on Gorshkov alone. It
failed to explore possibilities of ordering a brand new carrier or seeking a
surplus carrier from a Western country. Resultantly, it rendered itself
vulnerable to blackmail by Russia. May be India got taken in by repeated declarations
of lasting friendship and the free gift. India forgot the basic dictum that
‘there are no free lunches’. Friendship
means little in the world arms trade – commercial interests rule supreme.
The ship had been
laid at Chernomorsky shipyard in Nikolayev (now in Ukraine), with equipment
being supplied by various member countries of the erstwhile Soviet Union. Due
to the collapse of the Soviet Union, no design details and documents were
available. One wonders as to how large scale design changes that are required to reconfigure a
cruiser into a full-fledged aircraft carrier were realistically worked out. As is their wont, Russians were highly uncommunicative. India
left major designing to Russia. Although India Navy has a highly competent ship
designing bureau, India chose to sign the deal without full knowledge/analysis
of the design changes to be incorporated.
As pointed out by the CAG, the contract was drafted in a
highly amateurish and slipshod manner. For example, responsibility for paying
insurance premium was not specified and Russia got an opportunity to demand $35.80 million for it. There was no provision to levy liquidity
damages for delay at stages. For that matter, stage payments were not even
linked to demonstrated physical outputs that take forward the achievement of
the contractual objective. Most shocking is the fact that the contract did not include the
final blueprint and design of the ship being paid for. Everything was left fluid.
It was expected that the needed details would get evolved during the progress
of work.
In May 2007, the then Naval Chief
claimed that the ship would be delivered by late 2008 or early 2009. He went on
to declare that the Indian monitoring team located at the shipyard had
confirmed that the work was going on as per the schedule. Apparently, he was
unaware of the fact that less than 35 percent of the work had been done by
then. By August 2007, within a period of 4 months of the Naval Chief’s progress-on-schedule
assertion, the work came to a complete halt at Sevmash. Russia wanted India to
agree to revised cost and release additional payments.
In addition to three high level
committees constituted to monitor the project, a Warship Overseeing Team (WOT)
of 45 members was located at the shipyard for the entire duration of R&R
work. One wonders as to what functions WOT performed. India came to know of the
delay only when Russia presented the revised cost and delivery dates in
October/November 2007.
Finally
Hopefully, INS
Vikramaditya will perform and not become an embarrassment. It suffers from a
number of major limitations. Whereas aircraft carriers of similar tonnage carry
up to 40 fighter aircraft, Vikramaditya can carry only 16 fighters and 10
helicopters. Further, it will have to depend on its helicopters for airborne
early warning functions with highly limited coverage and endurance. As it lacks
catapult launch capability, AWACS aircraft like E-2D Hawkeye cannot
operate from its deck. Most worrisomely, Vikramaditya does not possess required
air defence capability at present.
As per the
reports appearing in the press, Russia is blaming India for exploiting the
situation when the Russian ship-building company was in a bad shape and facing
closure – for that reason, it was ready to sign any kind of contract. It is a
weird viewpoint. Instead of being grateful to India for saving Sevmash from
imminent bankruptcy, Russia is alleging that India drove an unfair deal.
CAG has lamented that cooperation from
the Ministry of Defence (MoD) in taking forward the audit effort was less
forthcoming than usual. MoD’s reluctance is understandable. It was a deal that
should have never taken place. India erred at every stage and capitulated
before the unethical seller. In CAG’s words – “The objective of induction of
Vikramaditya as an aircraft carrier in time to bridge the gap in Indian Navy
capabilities has been defeated. The decision to go in for R&R of a second
hand ship has become questionable as a new aircraft carrier would have cost
much less and would have had twice the life span”.
India should also be prepared for regular extortion by Russia.
Its past track record inspires little confidence. As the Russians never share
critical design details/drawings, India will need continuous Russian help to
maintain the ship during its entire service life. Russia will certainly exploit
such an immense leverage to extract unwarranted favours, both in terms of
exorbitant financial gains and additional defence orders.
Hopefully, India has learnt due
lessons from the deal and is much wiser now. India will do well to remember
that even inter-government agreements between two sovereign nations carry
little sanctity. The insincere will always find justification to
renege on them.*****
No comments:
Post a Comment