April 22, 2021
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Floating woes
India to buy advanced aerostat radars urgently

Although India is trying to acquire modern aerostat radars for detecting low flying aircraft, cruise missiles and UAVs, the whole deal has run into rough weather after law makers raise serious objections to buying it from Israeli manufacturer Rafael which did not give full support in an earlier contract.

Now India is trying to float a global tender urgently in which apart from Rafael there could be as many as six contenders like BAE Systems, Israel Aerospace Industries, Lockheed Martin, Northrop Grumman, Thales and Russian Rosoboronexport.

But Rafael is hopeful that the contract will come to the company as it can supply such hi-tech radars at a low cost.

Now, the cost advantage which used to be a prime factor in favor of the Israeli company is marred with controversy after CAG (Comptroller and Auditor General of India) raised serious questions about the ability of Indian Air Force to operate radars safely.

Rafael has quoted an increased price of 642 million USD for four aerostat radars whereas defence finance bench marking puts only 500 million USD for the deal.

Now, the only solution is the company needs to bring down the price or the MoD will have to float a global tender for the purchase of aerostat radars.

Earlier, it has been found that IAF officers simply neglected their duties and conduct which led to early degradation of such valuable and hi-tech assets after one of the aerostat radars which India had contracted in 2007 collapsed.   

India is planning to buy 25 aerostat radars in coming years to protect its cities, coast lines and military installations from aerial and sea borne attacks.

A Member of Parliament has already written a letter about the issue and the MoD is planning to walk bit slow on the matter while IAF is demanding the purchase on a fast track basis.

India is negotiating with Rafael and Israeli Aerospace Industry for the proposed import but there are complications over the price.

Earlier, Israel had quoted a price of 75 million dollar per aerostat radars which it sold to India few years ago in 2007 but suddenly there is a huge price escalation of 120 million USD per piece.

While Israel has attributed increased cost of production and material sourcing, India is asking for hike pattern of costing break ups.

India is ready for paying only 15 to 20 per cent hike on the earlier price quotation but Israel is not ready to bring down the price at the moment.

The negotiation is ongoing and Israel has brought out a detailed list of hike justification and cost figures. Meanwhile, the collapse of radars along India-Pakistan border has added a new dimension to the complication which is forcing India to go for inviting global tenders.   

Both India and Israel are not new to price negotiation of defence and hitech deals. The aerostat radars are the prime necessity of India at the moment to guard Indo-Pak and Sino-Indian border.

India is asking for all weather capability after sighting of UFOs along the borders between India and China.

It is being suspected that China is sending drones or electronic systems into Indian territory for reconnaissance.

Now India is planning to bolster surveillance capability and it needs long range radars those can send timely data.

Now, Israel is offering technology transfer and other support along with radar for example infrared night vision devices which can be mounted on the aerostat radars.   

Yet, the deal could run into rough weather if MoD and IAF fail to sort out their perception and negotiate the deal more skilfully.