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Old 12-23-2012, 02:25 PM
garpk garpk is offline
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Default $10 bn business: How Israel became India’s most important partner in arms bazaar

$10 bn business: How Israel became India’s most important partner in arms bazaar


Ullekh NP, ET Bureau Sep 23, 2012, 09.50PM IST


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(Nobody can beat Israelis…)

Israelis never tire of telling the story of David Ben-Gurion's great respect for Mahatma Gandhi. The founder of Israel, Ben-Gurion's few possessions when he quit active politics and retreated into a shack in a kibbutz in his late years included a portrait of India's father of the nation which enjoyed pride of place in his small study. So deep is the connection between India and Israel, they assure you.




It's an irony then that India and Israel established diplomatic ties only as late as 1992 though the Jewish nation was founded in 1948, a year after India became independent. "But the two countries were always natural allies," says Yossi Melman, award-winning Israeli journalist. And nowhere is this "natural alliance" more evident than in defence where Israel has become India's second-largest supplier; in 2009, the West Asian nation briefly overtook Russia, India's largest and the oldest defence supplier.
For all to see, the business relationship is thriving: in the past decade alone, Israeli defence sales to India surpassed $10 billion and the exports are expected to grow faster in the coming years.
However, there is a flipside to it: Indian officials and industry insiders say there is more to this "flourishing partnership" than meets the eye. There is widespread bribing of Indian officials by Israeli companies, they say.
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Famed Jewish Smartness
Corruption charges fly, but India continues to gain a lot from Israel's cutting-edge warfare technologies. "Nobody can beat Israelis in peddling weaponry. They are very, very good at it. It is tempting too because most often, they offer cutting-edge technology," said a former army officer who added that within weeks of Indian agencies detecting secret tunnels across the border from hostile neighbour Pakistan, Israelis have begun to suggest that India buy their "hot systems" to detect tunnels—which were of great use for Israel in cracking down on "secret" tunnel supplies from Egypt to Palestinians in Gaza. Israel's enemies transported everything from food to missiles through those underground tunnels.
"India will need them now because it has been found that there are tunnels dug by Pakistan to infiltrate to India," an Israeli official said asking not to be named.
The Israeli 'Invasion'Israel is India's second-largest defence supplier, after Russia. With costs of Russian spare parts for replacement escalating by 300-500%, it won't be a surprise if Israel soon emerges as India's No. 1 supplier Key Areas of Cooperation Submarine-launched cruise missiles Micro-satellite systems for surveillance Laser-guided systems and precision-guided munitions Anti-ballistic missile systems Upgradation of all Soviet-origin aircraft, artillery, tanks, etc. Various radars
Israel, currently, is under pressure to step up defence sales to rev up its flagging economy. A Delhi-based defence expert says the fall-out with Turkey, one of the country's major buyers in the Middle East due to political differences, has begun to hurt. The single-biggest buyer of Israel's defence products now is India, the world's largest defence spender. Conversely, India currently faces the prospect of buying $200 million worth of ammunition immediately (and another $1.5 billion worth of arms later) to make up for losses in the recent fires at Indian Army ammunition depots. Certainly, there are elements of desperation as well as opportunity there, says the government official referring to Israel's aggressive defence pitches. "Of course, India needs them too," he adds.
Ties That Bind


Thanks to Israel's highly advanced sensors (radars of various types), infiltration levels from across the border, from hostile neighbour Pakistan, have rapidly fallen over the past decade. Defence purchases from Israel are proof that the country has vastly improved its low-intensity warfare prowess. "No other country could make such a big entry in such a short time as Israel did in India's defence business," says a government official who didn't wish to be identified. Sure, it was a fait accompli, he hastens to add. The official agrees completely with Melman: "Both needed each other."

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http://economictimes.indiatimes.com/...w/16505973.cms
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Old 12-23-2012, 03:59 PM
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Garpk,

If Narendra Modi comes to power in Centre in India as is tipped, it ll usher in Israel and Britain as India's most powerful allies.
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