India’s Naval Buildup Positive For Regional Commerce

India’s Naval Buildup Positive For Regional Commerce

On August 5, 2013 late in the night, five Indian soldiers were killed in an ambush while on patrol in the Poonch sector of Jammu and Kashmir. Early reports show that the soldiers were attacked by about twenty men, some of whom were wearing Pakistani uniforms, shortly after beginning their patrol on the Indian side of the Line of Control.

This latest outbreak of cross border violence, one of at least seven this year, is particularly ill-timed with preparations currently underway for talks in New York between Indian Prime Minister Manmohan Singh and Nawaz Sharif, the recently elected Prime Minister of Pakistan. Along with recent border conflicts with the Chinese in the Ladakh sector, this event has opened up some already existent domestic criticism of India’s ruling coalition, the United Progressive Alliance (UPA), and their management of foreign policy generally and security issues more specifically. Both the conflicts and the debate serve to highlight important changes that have occurred within the realm of India’s defense and national security.

The reexamination of India’s defense posture by the Indian government is not recent, although recent events have certainly given it an added salience. In 2011, a National Task Force was formed to asses India’s strategic situation, including potential threats and appropriate responses amidst U.S. drawdown in Afghanistan, unrest in much of the Arab world, growing Chinese power, and of course the continual border issues both Pakistan and Burma. This was the second such high level attempt to reassess India’s defense posture following an earlier such event in 2001.

Some have pointed to failures to meet some of the goals outlined in the 2001 assessment, including reforms in India’s massive defense bureaucracy, important intelligence reforms, and a greater maritime role for India’s defense forces. Unspoken with such critiques is the underlying sentiment that despite newfound growth and dramatically enhanced international stature, India will continue to display much of the same reluctance to play great power politics that has often characterized much of its foreign policy and national security calculus in years past. Yet, despite this skepticism, many signs are pointing to significant changes in India’s defense posture and perhaps implicitly in India’s conception of itself in the world.

Amongst the biggest changes occurring in India’s defense position is that of a dramatic naval buildup. In 2012, India’s naval spending was $6.78 billion U.S. dollars, representing an astounding increase over figures such as the $181 million spent in 1988, three years before the repeal of the License Raj, which fundamentally changed and opened up India’s economy. Indeed, India’s overall defense spending for the fiscal year of 2013 is set to be $37.7 billion USD, up from the $32.4 billion of the previous year. By 2012 India’s defense spending had increased by 64% since 2001, representing a steadily increasing figure comprising 2.5 to 3 percent of the countrys’ GDP. While the increase in maritime security spending is reflective of India’s dramatically enhanced economic stature over the last two decades, it also illustrates the various security threats, which the Indian government is seeking to prioritize.

Additionally, the increased naval spending is also due to problems arising from an aged fleet, particularly among its carriers and submarines. Amongst the new acquisitions will be amphibian rescue equipment bought from Japan that is meant for search and rescue operations, thus further signaling India’s growing closeness to Japan. Naturally, with the expansion of aircraft carriers comes the aircraft itself. Amongst other purchases, India is set to acquire 125 Rafale fighter jets from France’s Dassault Aviation, 15 Chinook helicopters from the U.S. company Boeing, crucial refueling tanker aircrafts, as well as 16 Russian made MiG-29K and 4 MiG-29KUB carrier-borne jets. The carrier with which the MiGs would take off is a former Soviet “aircraft carrying cruiser” that has been refurnished. These developments suggest a rapidly changing posture for Indian defense forces that will potentially have important ramifications.

The dramatic buildup of India’s military capabilities is likely to continue to the foreseeable future. Defense spending by New Delhi is expected to reach $65.4 billion USD by 2020. Given the correlation between defense spending and GDP growth, the course which India has set is not surprising. Indeed, on a much smaller scale it mirrors the increase that has been steadily occurring in China, as both countries grow in assertiveness and desire to protect and further their grow influence.

While there is reason to think that this may portend an India more active in the international system, a development which many in the western international liberal order have long welcomed as a regional balance, there is still much reason to temper such expectations. Massive corruption in defense contracts, including allegations of bribery, provides reasons for pause. Although growing in stature, India will still continue to be focused on the myriad of domestic issues that confronts the country. The defense buildup, particularly in the maritime sector, is likely to worry neighboring powers such as China potentially creating an acceleration of already existing tensions and further arms buildups.

However, it should still be viewed as a positive for those interested in business in South Asia and the region. By furthering its capabilities to protect its economic interests, providing maritime security against piracy, and acting as a regional balance, India may provide much needed stability to regional waters that is essential for commerce. On a more micro level, the arms sales and agreements, which India has worked out with such a variety of countries including the U.S., France, and Russia, are also likely to have important economic effects as various countries seek to compete for contracts with India’s burgeoning defense buildup and will provide all engaged parties with various degrees of leverage as Indian power increases.

About Author

Sean Durns

Sean Durns worked as a research assistant to a former high ranking Pentagon official and the Director of National Security Strategies at a DC based think tank. His analysis has been referenced by a variety of media outlets including The Wall Street Journal, Roubini's EconoMonitor, OilPrice, and many more. He holds a M.Sc. in History of International Relations from the London School of Economics where he focused on US foreign policy, security studies, and energy security.