15 MAY 2016

Ø  Bruised by the successful Indian diplomacy that recently stalled the U.S. sale of F-16 fighter planes to it, Pakistan has found an opportunity to hit back. “It’s obvious that China’s position is aimed at keeping India out of the NSG if Pakistan cannot be a member of the same organisation,” said Shyam Saran, the former Foreign Secretary and Chairman of the Research and Information Systems for Developing Countries, a think tank under the Ministry of External Affairs (MEA). Responding to the developments, U.S. State Department spokesperson John Kirby said in Washington: “Well, first of all, I’m going to refer you to the governments of China and Pakistan with respect to their positions on India’s membership. Deliberations… about the prospects of new members joining the Nuclear Suppliers Groups are an internal matter among current members. And then I’d point you back to what the President said during his visit to India in 2015, where he reaffirmed that the U.S. view was that India, ‘meets missile technology control regime requirements and is ready for NSG membership.’” India got an exemption from the NSG for nuclear imports in 2008, following the civil nuclear deal with the U.S., despite not being a signatory to the NPT. In 2010, the Obama administration declared its support for India’s “full membership” of the group, but things have not moved far since. The NSG exemption in 2008 was the outcome of unqualified lobbying on India’s behalf by the then Bush administration. Several Western countries also were opposed to the exemption. The non-proliferation enthusiasts remain sceptical of India’s record since 2008 in taking additional steps to limit proliferation. The Chinese intervention that equates India with Pakistan — which has an established history of nuclear proliferation — complicates the scenario further. While the Obama administration remains in principle supportive of India’s admission to the NSG, its willingness and ability to push other countries will be tested next month. “The Obama administration’s support for India’s membership in all four export control regimes has been unwavering for years, extending back to the early days of the administration,” says Lauryn Williams, project manager, Nuclear Policy Program, Carnegie Endowment for International Peace. Foreign Secretary S. Jaishankar reportedly sought more forceful American intervention on India’s behalf during his interactions in April with U.S. interlocutors.

Ø  The Union government has set a target of $2 billion in defence exports in the next two years, Defence Minister Manohar Parrikar said. The Ministry had noted the concerns expressed over the issue of strategic partners in manufacturing and would hold discussions with the industry, he said at a seminar organised by the Automotive Component Manufacturers Association of India. The government intends to identify major private companies eligible to take the lead in critical defence projects so as to boost domestic manufacturing. From a meagre $140-150 million, this year I think we have crossed $330-odd million… I have set a target for myself, in the next two years, why not touch $2 billion. It is not an impossible target. Addressing automotive manufacturers keen on entering the aerospace sector, he highlighted the bottlenecks in defence exports in contrast to the automotive sector: to whom it was being sold; and international regulations. Mr. Parrikar said offsets were an area where “exports and expertise can come.” During 2014 and 2015, offset obligations brought in $990 million, and this was likely to touch $2 billion in the next two years as major deals for fighter aircraft and helicopters were expected to be signed. As part of the offset requirements, foreign companies are required to invest a part of the contract value back in the country.

Ø  The Air Forces of India and the U.S. concluded their four-week “Red Flag” aerial combat exercises at Alaska in the U.S. on Saturday. The two forces simulated realistic aerial combat scenarios in a networked environment. The Indian Air Force (IAF) flew 10 aircraft: four Su-30MKIs, four Jaguars and two IL-78 aerial refuelling tankers. A team of over 170 personnel was part of the exercises held from April 28 to May 13. “The objective of this inter-continental deployment was not only to showcase the IAF’s capability in undertaking integrated air ops but also to imbibe operational lessons from the exercise engagements, which will help us add more teeth to our overall war waging capabilities,” the team leader, Group Captain H. Assudani, said on the objective of the exercise. The exercise is played under the multiple simulated scenario designed to provide realistic settings with a Red Force, defending their airspace and assets, and a Blue Force acting as the offensive side. The IAF officials said that the Red Force was largely constituted by U.S. F-16 fighters, while the IAF planes, along with other USAF aircraft such as F-15, F-16 and F-22 and the U.S. Navy F-18, constituted the Blue Force. The teams had to endure sub-zero temperatures during most of the exercise, which posed a challenge to the maintenance team despite which they managed to maintain 100 per cent serviceability of all platforms. Col. William Culver from the U.S. side said, “This was one of the best ‘Red Flags’ I has seen. I compliment the exceptional standards displayed by the IAF and am amazed to see all the 10 aircraft IAF had brought maintaining 100 per cent serviceability for the entire four weeks and their aircraft flying on all days as per plan.” However, the exercises are an expensive endeavour and hence, the IAF had decided to participate once in five years. This edition is believed to have cost over Rs. 100 crore. The IAF fighters have always flown with their radars switched off during exercises with the U.S. so as not to reveal the radar signatures. The Indian side had received accolades during the last edition for their tactics and professionalism. The contingent is likely to return to India in the last week of May. The Su-30s will additionally participate in the exercise “Desert Eagle II” with the UAE Air Force on their way back, officials said.

Ø  China has increased defence capabilities and deployed more troops along the Indian border, the Pentagon has said, as it warned of increasing Chinese military presence including bases in various parts of the world, particularly Pakistan. “We have noticed an increase in capability and force posture by the Chinese military in areas close to the border with India,” Deputy Assistant Secretary of Defence for East Asia Abraham M. Denmark told reporters during a news conference here after Pentagon submitted its annual 2016 report to the US Congress on ‘Military and Security Developments Involving the People’s Republic of China’. However, Mr. Denmark said it is difficult to conclude on the real intention behind this. Referring to U.S. Defence Secretary Ashton Carter’s recent trip to India, Mr. Denmark said he had a very positive and productive visit. The Defence Department also warned of China’s increasing military presence including bases in various parts of the world, in particular Pakistan — with which it has a “longstanding friendly relationship and similar strategic interests”.

Ø  The government has granted permission to the Gas Authority of India Limited (GAIL) to use drones for aerial surveillance of its pipelines This follows the use of drones for similar purposes by the Indian Railways and the National Highways Authority of India. “As line patrolling is extremely difficult for pipeline sections passing through forests, rivers, environmentally sensitive areas and other inaccessible areas, GAIL (India) Limited has awarded an order for aerial surveillance of 200 kilometres for the Hazira Vijaipur Jagdishpur /Dahej Vijaipur pipelines with drones as a pilot project,” Minister of State (independent charge) of Petroleum and Natural Gas Dharmendra Pradhan told Parliament. “Surveillance of a vast network of pipelines across the country is required to ensure the safety and reliability of pipelines and guard against sabotage, exposure, soil erosion, excavation and construction works,” The drones will carry out surveillance using high-resolution and infrared cameras. NHAI signed a pact with the Indian Space Research Organization's National Remote Sensing Centre and the North East Centre for Technology Application and Research for the use of UAVs to aid in surveillance of construction work.Separately, the Indian Railways has used drones to monitor the progress on the Dedicated Freight Corridor.

Ø  President Paul Kagame said Rwanda was keen on plans to use drones to deliver blood supplies and vaccines, and was working with U.S.-based firm Zipline to launch the service by August.

Ø  In the wake of the amendment to the double taxation avoidance treaty between India and Mauritius, fees paid for engineering and technical expertise provided by personnel of a foreign company to an Indian company will now be taxed in India at 10 per cent, subject to certain terms. The fine print of the protocol, released by the Mauritius Government, has also proposed that the tax on interest income earned by Mauritian companies in India will be capped at 7.5 per cent.