India-Russia: News & Analysis

Kakkaji · Post by **Kakkaji** » 26 Dec 2015 07:08

Karan M: Please check Mil Acquisitions thread about new policy on offsets. What is your view?

member_24684 · Post by **member_24684** » 26 Dec 2015 08:36

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Oh come on dear BRFites ... Stop believing Russia

A bit good column from Janes ..of course a Ukrainian reporter

New Delhi faces a series of decisions on fast jet procurements that will determine the future direction and capabilities of the Indian Air Force's (IAF's) combat aircraft fleet.

At the heart of the matter is the Medium Multi-Role Combat Aircraft (MMRCA) programme - for which France's Dassault Rafale was down-selected in January 2012 - and Russia's Sukhoi T-50/PAK-FA fifth-generation fighter.

The central difficulty is what analysts in India described to IHS Jane's as a "massive disconnect between the Ministry of Defence [MoD], the IAF, and the political community in India who have to contend with larger diplomatic and industrial issues" on what the future IAF should look like.

At the centre of this conflict are those in favour of the Rafale and those who would instead place funds earmarked for that procurement into the development of a version of the T-50/PAK-FA, known in India as the Fifth-Generation Fighter Aircraft (FGFA).

For New Delhi, the issue is that "the money does not exist to have both the Rafale and T-50 programmes and, if you choose one over the other, you are making decisions that have long-ranging effects", an Indian analyst told IHS Jane's .

"If you put your resources into the T-50, then the IAF becomes an almost all-Russian fleet, and you are betting your future force structure on an aeroplane that is almost solely on paper at present. If you decide to go with the Rafale, then you are forgetting about having a fifth-generation aeroplane, but at least you know everything on this platform exists and works pretty much as advertised," he added.

The Rafale's fortunes are helped by what is regarded as a growing pro-Western shift within the IAF. The combined experience of working with the United States on programmes like the Boeing C-17 and Lockheed Martin C-130J-30 and Dassault aircraft such as the Mirage 2000 has led IAF officers to embrace the Western model for running and supporting programmes over the Russian style of doing business.

"Many in the IAF do not like the way the Russians work with them," said one Indian specialist. "The Russians treat Indians like they are children and the IAF officials with the gold braid on their caps are used to being treated with excessive deference and the Russians do not do that."

At the same time, however, the shift in the preference for Western aircraft within the IAF does not translate into a future market for a US-made fighter. The IAF is happy to have US-made transports and other platforms, but is not inclined to purchase a US aircraft for frontline combat requirements.

"There are still plenty of those within the armed forces who remember what happened in 1998 when sanctions were slapped on India by the US over its nuclear programme," said the Indian specialist. "Until all of those who were in the armed forces at that time are retired and gone there will be no major acquisitions of something like a [Lockheed Martin] F-35."

Janes

Why everyone thinks that Modi went to buy a tons of military goods. Rather than knowing the reality

1, SSN deal - meh we are building our SSN with foreign help. Navy won't ready to spend some billions for procurement ( Russian isn't happy they didn't get money to complete the Akula construction )

2. S 400 deal - Is that really it can do wonders. Why don't we invest more in Barak 8 and Barak 8 based long range system for AD.. and further continue with PAD and AAD ..tell uncle we called off S 400 ..now help us in AAD .. I think the S 400 still on the table may be it will be signed once Air force gets enough budget.

3 . PAK FA - Why no one here posted about the Russians who planned to slow down the project and continue with Su 35 S. Russia also cut down PAK FA orders to 17 from early 55. They need money , Modi will not ready to give it to Russia.

Let us invest that huge R&D money into AMCA with help from west the AMCA become good stealth fighter

Kakkaji · Post by **Kakkaji** » 26 Dec 2015 09:26

Russia offers new reactors for Kudankulam units

Russia has offered India a new range of reactor units — the VVER-Toi (typical optimised, enhanced information) design — for the third and fourth units of the Kudankulam project in Tamil Nadu. The Russians have also indicated that its state-owned nuclear utility Rosatom is open to shortlisting a handful of Indian equipment vendors in a bid to move towards a serial construction model in India, starting with the localisation of mechanical engineering production to produce components and equipment here to avoid time and cost overruns, as experienced with the first two units of the Kudankulam project.

Negotiations for the design contract for units 3 and 4 are already underway and these new reactors, expected to be supplied with far greater local inputs than was used for the initial set of two VVER-1000 reactor units at Kudankulam, are likely to require just a four-year construction period between first pour of concrete and commissioning.

Russia and India had, on Thursday, agreed to actively work on projects deploying 12 additional nuclear reactors, for which the localisation of manufacturing in India under the NDA government’s flagship ‘Make in India’ initiative and the commencement of serial construction of nuclear power plants was flagged as a joint initiative. In this context, the Programme of Action for localisation between Rosatom and India’s Department of Atomic Energy was finalised during Prime Minister Narendra Modi’s recent Moscow visit.

At the Kudankulam site, where the two Russian-designed VVER-1000 series reactors are being installed, nearly 100 Russian companies and organisations are involved in documentation, supply of equipment and controlling construction and equipping process. This has been cited as one of the reasons for the delays and localisation is being considered for quicker project execution at cheaper costs

Russia is also learnt to have reiterated its proposal for potentially involving India in building Russian-designed nuclear power stations in third countries. The cooperation is to be extended to the area of joint extraction of natural uranium and the production of nuclear fuel and atomic waste elimination. The Russian proposal to jointly build nuclear power plants is significant, considering that Rosatom has 29 nuclear reactors in various stages of planning and construction in more than a dozen countries (the largest internationally). These include in Jordan, Hungary, Egypt, Iran, Finland, Turkey and Argentina.

Philip · Post by **Philip** » 26 Dec 2015 09:43

We have brilliant scientists,some like Paulraj famous for sonar design geniuses.But what happened to him? His project/R&D was deemed unnecessary by a babu,shut down and he left India.
Kalam. Talking just a few days with a scientist."Kalam wasn't the best or most brilliant scientist around,but he was a great motivator,able to bring people together,establish teamwork and deliver results". I have many sad stories to tell of pvt. Indian industry,which have developed global bleedin' edge tech to be scorned by the DRDO ,"which only talks,talks,talks..", said a CEO who has been supplying critical eqpt. for decades and was giving up manufacturing one product in demand becos of its attitude.

The stark truth is that though we have developed some great tech in-house,we are still finding it difficult to put together the entire pieces of the puzzle,for weapon systems,many of which like the LCA have key firang eqpt.,into a workable,reliable product and manufacture it on a large scale with the requisite quality and within reasonable costs. This is where the famous manufacturers of the west and east score heavily over us.They know how to deliver weapon systems,combat capable,not simple tech-demonstrators. Make a list of all the programmes of the DRDO and which are true successes.What weapon systems do we export,if at all?

I think there was a report not too long ago with these stats in the media. So when we glibly talk that "we can do it",yes we can,but these systems must be handed over swiftly on time to the services for them to fight with before the system becomes obsolete. The key problem why we are not succeeding is the lack of a comprehensive technical foundation/manpower within the MOD that can swiftly evaluate service requirements,cut through red tape ,instead of the request going through endless laps of the desks of babudom.

Since this is the Ru td,let's get back on track.

1.FGFA: A few years ago a sr.. Ru diplomat said that we still hadn't decided upon what areas of the programme we wished to involve ourselves in/develop.He said that they had a timetable and would proceed according to that schedule. What happened then? We reportedly (officially) asked the IJT team to also handle the FGFA project. Theatre of the absurd! It revealed that there was a severe shortage of scientific/aero-engineering experts in HAL,etc. Add to this the IAF's demand that it wanted a two-seater,which the Russians said would take more time to develop,cost a lot more,etc. The last reports we've had a few months back was that it now appears that we may scrap the JV and simply buy a few sqds of single-seaters. We're waiting to see in the days to come news if any after the PM's visit.

2.N-sub lease: Here the IN wants a Yasen SSGN.The very latest in the RuN,only 2 commissioned,3-4 being built of an even more advanced version. As I've been debating with some in the IN td,we have just 1 N-sub,an Akula-2 (without some key eqpt found on Ru Akulas) which we've been operating for only 3 years. It is premature for the IN to operate a Yasen,when even the Russians are just getting to grips with the same. This is the considered viewpoint of many starred former/serving IN officers,esp submariners who have decades of experience. Even the Russians feel that it is premature for the IN to operate a Yasen.The easier solution would be accepting the second Akula-2 ,more advanced than the first which contain some Yasen features,giving us two similar Akula SSGN platforms in service,making it easier for training N-sub crews .operating the same eqpt.etc. This would then lead to a poss. Yasen lease around 2020 and a Yasen type SSN built in India later on.

Remember the acute crisis existing in our sub fleet,suffering from maintenance/support problems thanks to the Cong/UPA,which led to the loss of the SRakshak,other sub/warship accidents and Adm. Joshi resigning in protest as AKA put the entire blame upon the IN. Then there is the serious problem across the IN of lack of enough sea-going command experience of serving middle ranking officers.They lack enough hands-on sea experience,command opportunities,essential for young officers so that they can handle command of larger warships,etc. in the careers (instead of being paper-pushers at a desk),which after inquiries into the spate of accidents in recent years found this to be one of the reasons. The past generation of IN officers were given command early on if capable,after very professional training. They could handle any crisis,any kind of eqpt.,and had great multi-tasking ability.It is because of their efforts that we now see the IN as a truly Indian built navy in the main.They had the vision and laid down the masterplan for the IN for the 21st century.

The structure of the IN has also undergone huge changes in the decades from the '80s. A former sr. officer told me that he was solely in charge of the entire Bombay base in the rank of a commodore, "it is now being handled by a few R.Adms,plus a few commodores ,doing much the same work which I handled alone." "They have cheapened rank" he said.Babudom in uniform is an alarming growing trend. We are not the USN where there are dozens of admirals from 4 to 2 star who operate the largest navy in the world ,100 times more complex than the IN. Also factor in the huge cost of such a sub and the fact that the IN gets the least share of the defence cake.

3.S-400s: If our desi ABM system worked fine there would be no need for S-400s. Since Akash has been accepted,after extensive trials,it shows that when we deliver,orders happen. Given the extensive missile threat from the Sino-Pak JV,our defence planners have determined that we need the S-400 asap,so lets accept that need and decision to acquire it.Bargaining on costs will be byzantine as always! I doubt that the Braak-8 ( a tactical SAM) has the same ABM capability than the S-400.

4.KA-226: Decision after a fair contest,the Chetak/All-3 replacement should've arrived 5 years ago. This decision is already years late. The need is for hundreds and our HAL LUH has yet to fly,let alone be certified and enter production.This will take a few years,so there is no alternative to acquiring the KA-226 now both off the shelf and local production.

5.MI-17Vs: V. successful in IAF service,the best in its class in the world and more needed for Himalyan ops. Given the large no. acquired,why we never though of local manufacture here beats me.At least a support/spares JV co should be set up as is being done for other systems.

6.Extra Kilos?: Since we lost the SR,we're one short,therefore another two v. capable 636s won't hurt,as some are around 3 decades old and there are limitations to upgrades of these oldest subs. The U-boats are equally old and long in the tooth.Kilos are v.cheap too,just $300m apiece compared with $500M+ for nw western diesel/AIP subs. Will save on training/support too.

7.Extra Talwars: Negotiations/discussions have been on for sev. years now.The IN want more as these are v.capable cost-effective warships,carrying huge punch for their weight/size. With the R Co. in pole position to build them...in Gujarat,with an agreement already inked,this deal most likely will happen.

8.BMPs.A pity that after decades of licence production,our AV vision has been so compartmentalised.When world over OEMs are designing ,developing and building new families of AVs from MBTs to ICVs,etc. we still have to import BMPs. Well,if the shortage/need is there (for Cold Start),.... Something must be done with our AV DPSUs/OFB for ammo.

9.New N-reactors: A veritable coup for Russia,leading the pack in building N-reactors for India.Western manufacturers will now have to compromise on their opposition to liabilities and follow the Russians,which they seem to be doing,as we'll see some western N-plant orders too shortly.Equally important is the note about joint manufacturing of N-fuel.

But the most significant outcome could be found in the PM's speech. Russia will ,says the PM,remain our most trusted friend and reliable supplier of high-tech in defence. Trade and ties are being expanded across the spectrum of defence,economic and socio-cultural domains. A v.pleasing outcome,let's wait and watch for more details to emerge.

Philip · Post by **Philip** » 27 Dec 2015 18:42

https://www.rt.com/op-edge/326980-russi ... odi-visit/

Where does India fit in the new Russia-China partnership?’
24 Dec, 2015 12:27

Russia's President Vladimir Putin (front R) and India's Prime Minister Narendra Modi (front L) walk during a meeting at the Kremlin in Moscow, Russia, December 23, 2015 © Alexey Nikolsky

It is important for India to remain part of the conversation with Russia and China despite disagreements between Beijing and New Delhi over Afghanistan and Pakistan, Indian journalist and commentator Vijay Prashad told RT.

Indian Prime Minister Narendra Modi arrived to Moscow on Wednesday for a two-day visit, just one week after India’s Defense Acquisition Council (DAC) approved the purchase of five S-400 air defense systems from Russia.

RT: Why is Modi's visit so significant at this particular time?

Vijay Prashad: Mr. Modi has been traveling to most of the world’s capitals. So it was about time he came to Moscow. The most important aspect of this visit is that there needs to be a readjustment between India and Russia. This has been a long time coming, particularly given the fact that Russia and China have been creating a new kind of partnership. I think there needs to be a discussion of where India fits in to the new Russia- China partnership.

India's PM Narendra Modi © Adnan AbidiIndia’s Modi comes to Russia - with love
RT: It's believed the two countries will sign a massive weapon deal. How significant will this be for both Moscow and India's military goals?

VP: India used to buy most of its armaments from Russia, then the Soviet Union, until the 1990’s. From the 1990’s onward, India has diversified its purchases from the US and to a large extent from countries like Israel. It seems now that Russian arms have come back on line. India is going to rebalance some of its arms purchases. It is important to bear in mind: India is the leading importer of weapons in the world.

But actually there is something else on the horizon here, not merely arms purchases. India is now eager to create a domestic arms industry, and it seems that the Russian government is quite willing to transfer some technology towards this end. So not only will India likely begin to buy greater volumes of arms from Russia – there is talk of several billions of dollars of arms purchases in this two-day trip itself - but also India is going to try to ink some deals so that it can develop its own arms industry.

RT: How important do you think relations with Russia are for India?

VP: India has over the last 20 years leaned quite heavily towards the US. And in the last 10 years or so with the emergence of the BRICS bloc, this has balanced out India’s allegiances or alliances with the US. So the relationship with Russia is very important because it brings India back somehow not so much as a subordinate ally of the US, but it might allow India to develop once again a rational pragmatic foreign policy based on a more complicated understanding of the world. When the Indian government saw the geopolitics as largely framed by the US that had a tendency to move India into the Western camp. Now with the emergence of what we might consider multi-polarity, the new relationship with Russia will allow India at least to balance its place in the world order.

READ MORE: India seeks Russia's 'crown jewels' in biggest arms deal of the decade

RT: China is also a diplomatic rival of India. How might Beijing view a potential deal between Russian and India?

VP: This is a very complicated situation. India and China have a great deal of disagreement about the role, for instance, of the Taliban in Afghanistan, where because of China’s entanglement with Pakistan, it has a slightly different view than the Indian government. This is also of course the case between, say, the role of the pipelines that are being drawn across Asia: what is the relationship between China and Pakistan; where will India fit into this?

...It is important that India remains part of the conversation. It is important that countries such as Russia and China understand that the enmity between India and Pakistan should not be used as a tool against these countries. But they should also use their leverage as a way to bring India and Pakistan to the same table.

Lilo · Post by **Lilo** » 28 Dec 2015 02:41

Hitches persist in Indian plans to lease second Russian SSN

Indian Navy (IN) plans to lease a second Russian nuclear-powered attack submarine (SSN) for 10 years are floundering over cost and technology transfer issues, official sources have indicated.

The SSN lease, which was to have been confirmed during Prime Minister Narendra Modi's Moscow visit over Christmas, has, for now, been deferred, industry sources told IHS Jane's .

The submarine agreement was earlier discussed by Indian defence minister Manohar Parrikar and his Russian counterpart, Sergey Shoygu, in Moscow in November, but remained unsettled.

Both sides have been negotiating for over three years to lease a follow-on SSN, which was originally to have been Iribis : a Shchuka-B (NATO designation 'Akula')-class boat that was abandoned, half-completed, in the 1990s after the break-up of the Soviet Union. India was to have financed the completion of Iribis - which is similar to INS Chakra , the SSN that joined the IN on a 10-year lease in April 2012 - for an estimated USD962 million.

However, negotiations recently centred on India leasing a more advanced Yasen-class SSN, one of which was to have been built for the IN in a joint venture, under which Indian naval architects and designers would work in Russia alongside their more experienced Russian counterparts.

It was intended that, upon returning home, the Indian technicians would employ this expertise to indigenously design and build six SSNs over 10-15 years under a INR1 trillion (USD15 billion) programme approved by the government in February.

However, industry sources said differences over the SSN's price had in recent months resulted in Russia "reconsidering" this plan and instead offering the IN retrofitted Akula-class SSN currently in Russian Navy service.

The IN, however, remains unwilling to accept this proposal and is still engaged in trying to persuade Moscow to concede the alternative arrangement for the Yasen SSN.

Russia had earlier collaborated with the IN in designing and building INS Arihant : its first indigenously designed ballistic missile submarine (SSBN), which has been undergoing sea trials since December 2014.

A derivative of the 670A Skat series ('Charlie I'-class) boats, Arihant could join service ahead of the IN's International Fleet Review in February 2016.

COMMENT
Other than costing and technology issues over the SSN lease for the IN, industry sources say Russia has another major issue with India that is adversely affecting the deal: its displeasure with India sourcing its defence requirements - such as helicopters, fighters, transports, and maritime surveillance aircraft - from the United States and France and not from Moscow, which has been principal materiel supplier for almost five decades.

This had even prompted Moscow to agree to sell India's nuclear rival, Pakistan, at least four Mil Mi-35 'Hind' attack helicopters and to open negotiations on providing Islamabad with Sukhoi Su-35 fighters.

However, Russia is also the only one of the permanent five members of the UN Security Council willing to provide India with strategic knowhow. Consequently, it is using this as leverage to 'influence' India into acquiring various Russian defence platforms, like light utility helicopters and the S-400 air defence system, both of which are expected to feature in Modi's upcoming visit to Moscow.

Vivek K · Post by **Vivek K** » 28 Dec 2015 05:03

Russia is either a friend or not. India cannot forever stop Pukis from acquiring modern weapons. Instead, India needs to look at defining her role in the world and build capabilities to project power commensurate with that role.

A friend does not threaten another. India is sourcing a lot of hardware from Russia - Mig-29ks,T-90s (thousands), Sukhois, Gorshkov, MI-17s in addition to Ka226s etc. That is worth several billions. If Russia thinks it can develop an alternative to India bankrolling Russian economy through Pukistan, then they should go through with this.

Appeasement does not work - not with the French and not with the Russians or with any other. This is precisely why India should cancel the 226, not beg for the Yassen (I hope Indians have other means to acquire Russian designs), stop acquiring hordes of T-90s and the Krivaks. Instead, focus on Shivaliks, Kolkatas, Vikrant class, Arihant, Arjun, LCA, Astra, Trishul, Akash.

India's priority as a sovereign country should be 'India First'!!

ramana · Post by **ramana** » 28 Dec 2015 10:32

IN sub scheme is bold and ambitious. Don't know what the retired folks are thinking about leasing old Akula when plan is joint building the new boats.

Viv S · Post by **Viv S** » 28 Dec 2015 19:40

Saudi Arabia is killing the Russian economy in its fight to control oil prices

JIM EDWARDS DEC 24, 2015

It's a double-edged sword, of course.

A year ago, Saudi Oil Minister Ali Naimi made it plain that he didn't care what happened to Russia if oil-producing countries failed to cooperate with Saudi-dominated OPEC on keeping prices high by restricting production.

"We want to tell the world that high efficiency producing countries are the ones that deserve market share," he said, before singling out Russia's West Siberia as a region that wasn't very good at producing competitively priced oil.

Since then Russia's oil-dependent economy has been decimated as the price of oil has plummeted. Here is the chart of the Russian economy from OPEC's most recent report on the state of the global oil market:

Note that Russian GDP was growing until this time last year, when the Saudis signalled that they were going to pump Russia into oblivion.

All year, oil-producing countries have been in a mad race to the bottom. Russia and the US (and a bunch of other countries) refuse to cooperate with OPEC to keep prices high, so Saudi Arabia and OPEC have been furiously pumping cheap, competitively priced oil. The increased supply has driven down prices. Oil started the year near $55 a barrel and is now nearer $35, as this Bloomberg chart of West Texas Intermediate shows:

And oil is going to stay cheap. OPEC said that a barrel of oil won't be worth $100 until after 2040, in an in-depth report on long-term energy trends.

Cheap oil isn't good for the House of Saud either, but the Saudis have more money and cheaper oil than the Russians. So pain for the Saudis is agony for the Russians. The theory is that the Saudis are trying to force Russia into OPEC, according to Ambrose Evans-Pritchard of The Telegraph:

Kremlin officials suspect that the aim of Saudi policy is to force Russia to the negotiating table, compelling it join Opec in a super-cartel controlling half the world's production.

The Russians aren't having it, the CEO of Rosneft told the Financial Times earlier this year. President Putin, of course, famously does not like to be forced to do anything, so it's unclear why the Saudis thought this tactic would work.

The other factor is the Americans.

Both Russia and the Saudis would prefer it if the US's shale oil fields went out of business. That would leave the growing Chinese market open for Russia to expand its market share there. (The Russian conspiracy theory is that the Saudis want Russia to restrict supplies only because it will curb Russia's entry into China, leaving China open for the Saudis.)

No matter how you arrange all these moving parts, the upshot is that both Saudi Arabia and Russia are bearing the pain now in the hopes of keeping the price so low that it drives the US sites out of business later, according to Quartz:

They have argued that their enormous cash reserves will allow them to weather any price for as long as it takes to finally force upstart US shale drillers to turn off their spigots.

The war has cost Russians dearly. This OPEC chart of Russian monthly unemployment (at right) shows percentage changes.

Russia has responded not by laying people off - at 5.5%, unemployment is technically quite low - but by reducing wages and work hours. These OPEC charts of sales and production show how Russians have basically stopped making things, and stopped shopping, as much as possible:

Viv S · Post by **Viv S** » 28 Dec 2015 19:42

Russia’s energy minister blames Saudi Arabia for destabilized oil market

According to Alexander Novak, Saudi Arabia increased its oil production by 1.5 mln barrels per day

MOSCOW, December 28. /TASS/. Saudi Arabia has destabilized oil market by increasing its oil output by 1.5 mln barrels per day, Russia’s Energy Minister Alexander Novak said in an interview with Rossiya 24 TV channel. "This year Saudi Arabia has ramped up production by 1.5 mln barrels per day, which in fact destabilized the situation on the market," - he said. "According to experts’ estimates, demand-and-supply curves may coincide in the second half of 2016, which will balance the market," - Novak said. He added that such a factor as "new production in Iran" may affect the market.

Viv S · Post by **Viv S** » 28 Dec 2015 19:48

Russia plans $40 a barrel oil for next seven years as Saudi showdown intensifies

'We will live in a different reality,' said a top Kremlin official. The message is aimed squarely at Saudi Arabia in a war for market share

By Ambrose Evans-Pritchard, 11 Dec 2015

Russia is battening down the hatches for a Biblical collapse in oil revenues, warning that crude prices could stay as low as $40 a barrel for another seven years.

Maxim Oreshkin, the deputy finance minister, said the country is drawing up plans based on a price band fluctuating between $40 to $60 as far out as 2022, a scenario that would have devastating implications for Opec.

It would also spell disaster for the North Sea producers, Brazil’s off-shore projects, and heavily indebted Western producers. “We will live in a different reality,” he told a breakfast forum hosted by Russian newspaper Vedomosti.

The cold blast from Moscow came as US crude plunged to $35.56, pummelled by continuing fall-out from the acrimonious Organisaton of Petrol Exporting Countries meeting last week. Record short positions by hedge funds have amplified the effect.

Bank of America said there was now the risk of “full-blown price war” within Opec itself as Saudi Arabia and Iran fight out a bitter strategic rivalry through the oil market.
Brent crude fell to $37.41, even though demand is growing briskly. It is the lowest since the depths of the Lehman crisis in early 2009. But this time it is a 'positive supply shock', and therefore beneficial for the world economy as a whole.

The International Energy Agency said in its monthly market report that Opec has stopped operating as a cartel and is “pumping at will”, aiming to drive out rivals at whatever cost to its own members. Opec revenues will fall to $400bn (£263bn) this year if current prices persist, down from $1.2 trillion in 2012. This is a massive shift in global wealth.

The IEA said global oil stocks were already at nose-bleed levels of 2,971m barrels, and were likely to increase by another 300m over the next six months as “free-wheeling Opec policy” floods the market.

The watchdog played down fears that the world was running out of sites to store the glut, citing 230m barrels of new storage coming on stream. Inventories in the US are still only at 70pc capacity. But this could change once Iranian crude comes on stream later next year.

Russia’s $40 warning is the latest escalation in a game of strategic brinkmanship between the Kremlin and Saudi Arabia, already at daggers drawn over Syria.

The Russian contingency plans convey a clear message to Riyadh and to Opec’s high command that the country can withstand very low oil prices indefinitely, thanks to a floating rouble that protects the internal budget.

Saudi Arabia is trapped by a fixed exchange peg, forcing it to bleed foreign reserves to cover a budget deficit running at 20pc of GDP.

Russia claims to have the strategic depth to sit out a long siege. It is pursuing an import-substitution policy to revive its industrial and engineering core. It can ultimately feed itself. The Gulf Opec states are one-trick ponies by comparison.

The deputy premier, Arkady Dvorkovich, told The Telegraph in September that Opec will be forced to change tack. “At some point it is likely that they are going to have to change policy. They can last a few months, to a couple of years," he said.

Kremlin officials suspect that the aim of Saudi policy is to force Russia to the negotiating table, compelling it join Opec in a super-cartel controlling half the world’s production.

Abdallah Salem el-Badri, Opec’s chief, came close to admitting this last week, saying the cartel is no longer big enough to act alone and will not cut output unless non-Opec producers chip in.

“We are looking for negotiations with non-Opec, and trying to reach a collective effort. Everybody is trying to digest how they can do it,” he said.

Russia is in effect calling Opec’s bluff, gambling that it has the greater staying power. It cannot easily cut output since its main producers are listed companies, answerable to shareholders. Any arrangement would have to be subtle.

Mr Dvorkovich gave an oblique answer when asked whether Russia would ever do a deal. "We are not going to cut supply artificially. Oil companies will act on their own. They will look at market forces and decide whether to invest more or less. If prices stay low, it is in the nature of oil companies to stabilize production, or even to cut production," he said.

Mr Oreshkin said oil prices of $40 would force the government to bleed its reserve fund by 1.5 trillion roubles next year, or 2pc of GDP.

Standard & Poor's says the budget deficit has reached 4.4pc of GDP, including local government shortfalls. A further $40bn is needed to bail out the banking system.

“They just don’t have the money. The deficit is heading for 5pc of GDP,” said Lubomir Mitov from Unicredit.

“The biggest danger is that the reserve fund will be exhausted by the end of 2016. They will then have to monetise the deficit or cut real spending by another 10pc. They can’t cut defence so that leaves social welfare,” he said.

Bond markets in Russia are shallow. The country cannot hope to borrow abroad on any scale as long as it is under Western sanctions.

Saudi Arabia’s leaders are fully aware of the Kremlin’s painful predicament. They appear certain that they can outlast Russia in a long duel. By the time we find out which of these two petro-giants is stronger, both may be on their knees.

Whether Russia really can withstand the strain for years is an open question. The economy is in deep recession. Output has contracted by 4pc over the last year. Real incomes have fallen by 9pc. The latest gambit may in reality be a negotiating ploy.

NRao · Post by **NRao** » 29 Dec 2015 06:58

The table is set.

India knows most of the cards. 2030-2040 is it for Indian development.

Meanwhile, the FGFA, S-400, etc are dispensable. With ALL that monies saved from importing oil, India should rightfully invest in Def. Opportunity is really good and mostly predictable.

vishvak · Post by **vishvak** » 30 Dec 2015 01:27

India should either get the Russia arms or develop in house, step by step manner while evolving doctrines that are independent and do not muddle along carrying drag of 'international' interest groups, or do BOTH. FGFA, S-400 and such top of the line Russian weapons fit exactly what we need. By the way, even Americans have saved a lot of monies from import of oil and therefore will be funding more to the American defense capabilities including naval warfare, and therefore, Russian counter capabilities will increase too alongwith in naval field.

chanakyaa · Post by **chanakyaa** » 30 Dec 2015 08:43

Kremlin officials suspect that the aim of Saudi policy is to force Russia to the negotiating table, compelling it join Opec in a super-cartel controlling half the world’s production...

Low prices may be designed to create unrest and throw him out of the office, more than dragging to the table. What if oil goes to $25?? Combination of economic sanctions, low oil revenues, and higher expenses from being dragged into ME wars if not managed properly, can create deep economic stress, just in time for the opposition parties to cry mismanagement in 2018 (re)elections.

Philip · Post by **Philip** » 30 Dec 2015 09:33

Like the old Rupee-Rouble trade,we could though barter biz,export billions of finished comnsumer goods,foodstuff,etc. to Russia woprth billions each year.This could easily offset payment of hard currency for sophisticated arms.It was in this manner that we built up a formidable military force that saw us in good stead in '71. Maybe the clock has tuened back,"carpe diem"!

Philip · Post by **Philip** » 30 Dec 2015 17:38

The Ru Syrian gambit has shocked the West/US who fondly believed that the Bear
was long in the tooth.Instead they found that the Bear had very long and sharp teeth!

One of the principal beneficiaries of the Russian naval expertise will be India,with the latest news of Indo-Russian deals to be sealed in due course.

http://www.foxnews.com/politics/2015/12 ... ildup.html
[quote]Intelligence report warns of Russian naval buildup
By Bill Gertz
·Published December 29, 2015
· Washington Free Beacon
Following decades of neglect, Russian naval forces are being modernized with advanced submarines and increasingly lethal ballistic and cruise missiles, according to a report by the Office of Naval Intelligence.[quote]

[quote]Putin-Modi talks a success, but no ‘Triumph’
25 December 2015 Alexandra Katz, specially for RIR

Vladimir Putin, and Narendra Modi reconfirmed the importance of the strategic partnership between the two countries. During the Indian Prime Minister’s visit to Russia, they also stressed the need for closer cooperation in various fields. However, several crucial defence contracts which were expected to be signed, did not materialize this time.

Related
•Russia remains our principal partner: Narendra Modi
•Modi to talk terror, give Russia support on Syria

Indian Prime Minister Narendra Modi’s Moscow visit, on December 23-24, 2015, has added to the portfolio of bilateral intergovernmental agreements; 16 new strategic agreements were signed on cooperation in various fields. Among them were an agreement in the field of nuclear energy, in the production of hydrocarbons and geological surveys, agreements on cooperation in the construction of helicopters, on investment cooperation in the Russian Far East, and on technical cooperation in the railway sector.

The countries also signed a protocol amending a previous agreement on simplification of the visa regime for diplomats and businessmen; the need to simplify travel between the two countries has long been a demand by representatives of the business community.

“We have had excellent conversations over the past two days and very productive outcomes. It has deepened my conviction that this relationship truly meets the test of a special and privileged strategic partnership,” said Modi after the talks in Moscow. “We have laid the foundation of the future character of our strategic partnership,” he added.

Modi called Russia a prominent partner of India’s economic transformation. He urged Russian businesses to invest in various sectors of the Indian economy, to focus special attention on the “Make in India” programme, which aims to transform India into a global manufacturing centre.

The agreement on the joint production of the light multipurpose helicopters, the Ka-226T, signed after the summit meeting, will be the first major project in the defence sector within the framework of the “Make in India” programme, noted the Indian Prime Minister. The Russian partners in this project are Russian Helicopters and Rosoboronexport, while the Reliance Defence Company will be the Indian partner company.

Contrary to expectations, however, the two countries could not close the deal for India to purchase of five batteries of new generation anti-aircraft systems – the S-400 Triumph, which was estimated at being worth $4.5-7 billion. Negotiators failed to agree on a price for the anti-aircraft defence systems. This deal is important for India, given its vulnerability to rocket attacks from Pakistan and China. China became the first buyer of the newest Russian air defence system, the S-400, with the deal officially being announced in April this year.

On the eve of Modi’s visit to Moscow, analysts in India assumed that the countries would conclude several additional defence deals. These included the procurement of 48 Mi-18 helicopters, 150 BMP-2K armoured vehicles, and modernization of India’s aging fleet of IL-78s and IL-76s. It was also expected that India and Russia would sign final agreements for two diesel-electric submarines of Project 636 ‘Varshavyanka’ and three Project 11356 frigates, as well as a contract to lease the second Project 971 nuclear submarine.

In all sectors

Important decisions were taken in the field of nuclear energy and hydrocarbon cooperation during the meeting between Putin and Modi. The leaders discussed the launch of the second unit of Kudankulam NPP in India, due to happen soon, along with plans to build the third and fourth units. Negotiations to construct the fifth and sixth power units are on. They also discussed the allocation of another Indian site to build Russian-designed nuclear reactors.

Source: Kremlin.ru

The plans of Russian hydrocarbon companies for cooperation with India were confirmed. An agreement between Rosneft and the ESSAR Group calls for supplying Indian refineries with around 10 million tons annually over 10 years. The Gazprom Company plans to expand its supply of liquefied natural gas and is currently developing several thermal and hydropower projects in India. The Power Machines Company has provided equipment for the hydro power plants Teri and Balimela, and the Konasima Thermal Power Plant. The company is currently building three new power units for the Sipat Thermal Power Plant.

The leaders noted the growing cooperation between the two countries in the diamonds production centre. According to Putin, almost half of the Russia’s rough diamond exports head to India. Modi said India has created a special zone to facilitate direct trade between the largest diamond producers in Russia and India.

Putin and Modi acknowledged the importance of developing new logistics routes to improve the profitability of trade between the two countries. One such route is the North-South International Transport Corridor, which will significantly reduce the cost and time of transporting goods from India to Russia, and in the opposite direction.

During a meeting with representatives of Russian and Indian business communities, attended by heads of major public and private corporations in the two countries, the Russian President admitted that between January and October this year, the trade turnover between the countries, which for many years has been very low, had further decreased by 14.4 percent.

“This is mainly due to lower energy prices and demand for engineering products, caused by unfavourable external conditions, and foreign exchange rate differences,” he explained, adding that the two countries have agreed to intensify efforts to bring bilateral trade onto a path of sustainable positive growth. Both governments have announced plans to increase bilateral trade to $30 billion annually, and the volume of mutual investments to $15 billion by 2025.

The President noted the intention of both countries to develop and diversify trade, work on reducing administrative and other barriers. He recalled that some Russian companies, including Rosatom, Gazprom, Russian Railways, Power Machines, Lukoil, AFK Sistema, Rosneft, and Renova, are already successfully operating in India. In December 2014, at the last bilateral summit in New Delhi, the Russian Direct Investment Fund (RDIF) agreed to make joint investments with Indian companies in infrastructure and energy projects, including production of clean energy.

“We are interested in having our Indian partners actively export their products into Russia,” said Putin. “We support the serious attitude of our partners on long-term fruitful work in Russia. We will do everything to make them feel comfortable in our country, and develop their businesses.”

Source: Reuters

The Russian President mentioned the Kadima project, which is developing the production of pharmaceutical products in Yaroslavl Oblast. Most likely, he was referring to the company Cadila Pharmaceuticals Ltd, which indeed has declared similar plans.

Unfortunately, among the real-world examples of successful Indian investments, they did not mention projects such as Dr. Reddy’s Laboratories with the Russian R-Pharm Company to establish a scientific-industrial complex to develop and produce active pharmaceutical ingredients in Yaroslavl Oblast, investment projects of Pharmasyntez, which was created by the Indian company Vikram Punia in 1997. Also not mentioned was the project of the Advance Trading Company, one of the largest distributors of Indian products in Russia, which is being implemented in the Belgorod Oblast in collaboration with its Indian partner.

Business as usual

The 16th annual Russian-Indian Summit, held in Moscow, was very positive. Held parallel with the summit level negotiations, several large corporations signed new deals and partnerships.

The Reliance Defence Company, which is working on several Indo-Russian projects in the defence industry within the “Make in India” programme, including production of helicopters, submarines and ships, has signed an agreement with the company Almaz-Antey JSC.

According to a press statement issued by Reliance Defence, the two sides have decided to cooperate in the field of missiles and missile defence systems. The partnership involves both work on existing Almaz-Antey production systems in India, and cooperation in new defence products.

“Our proposed partnership will constitute an important milestone in the strategic relationship between the two countries,” said the CEO of the company, the billionaire Anil Ambani.

Within the framework of the bilateral summit, Rosnano OJSC and the Indian National Investment Infrastructure Fund agreed to work together to build a Russian-Indian investment fund to implement joint projects in the high-tech sector.

According to Rosnano’s press release, the partners will contribute $2 billion, in equal shares, and establish a common management company to implement high-tech projects at the growth stage, including dual-use technologies and products of the military-industrial complex.

“The creation of a joint private equity fund means moving to a new stage of development of relations, in these tough economic conditions of today’s global market. The fund is aimed at strengthening the competitive position of Russian companies, to promote the export of Russian high-technologies on the promising Indian market,” said Anatoly Chubays chairman of the board of directors of Rusnano.

During talks between Alexey Likhachev, Russian First Deputy Minister of Economic Development, and Shaktikanta Das, India’s Secretary, Economic Affairs, the National Immuno-Biological Company, which is part of the Rostec State Corporation, and the Serum Institute of India agreed to locally produce medicines in Russia at the Natsimbio Plant.

Full mutual understanding

During their two-day meeting, Putin and Modi displayed the importance of the “personal chemistry” between them. The Indian Prime Minister was the Russian President’s guest of honour at a private dinner; this gesture is not made for every political leader.

Source: Artem Korotayev/TASS

During the talks at the Kremlin, Putin noted that Modi’s visit was very timely, and a number of issues require special attention, especially in the current economic conditions. The Indian Prime Minister repeatedly praised the achievements of his Russian counterpart in the economic and geopolitical development of Russia. “You raised your country and the government to a new level. The world has great respect for Russia, and this is your personal achievement,” said Modi, referring to Putin.

The Indian Prime Minister repeatedly emphasized the strategic nature of the partnership and thrice expressed his condolences over the loss of lives in the terrorist attack on the Russian civilian aircraft over Sinai, and the tragic loss of the Su-24 in Syria, and assured the Russian president that India was mourning along with Russia.

After their summit, a joint statement entitled “Through trusting relationships – to new horizons of cooperation”, the leaders of Russia and India spoke about important geopolitical issues, including their support for the sovereignty, unity and territorial integrity of Syria.

“The parties have agreed that the internal armed conflict in the country has no military solution, and can only be resolved by political and diplomatic means – through substantive inter-Syrian dialogue without preconditions or external intervention, and on the basis of the Geneva communiqué of June 30, 2012, the Joint Statement after the multilateral talks on Syria in Vienna on October 30, 2015, and the Statement the “Syrian Support Group” on November 14, 2015,” the document noted.

“Russia supports further strengthening of India’s role in resolving global and regional problems,” Putin said in a statement to the press at the end of the Summit. “We believe that India, as a great power, is conducting a balanced and responsible foreign policy, and is one of the most worthy candidates for permanent membership in the UN Security Council.”

Russia and India have also “expressed strong support” for the Iraqi people and state authorities in their efforts to overcome the current crisis. The Ukrainian issue also made it into their joint statement – the leaders of the two countries assessed the progress made in the security sphere, including compliance with ceasefire conditions in the south-east of Ukraine.

The naval buildup includes three new classes of advanced submarines and several new types of warships that the report warns will “provide a flexible platform for Russia to demonstrate offensive capability, threaten neighbors, project power regionally, and advance President Putin’s stated goal of returning Russia to clear great power status.”

Following the collapse of the Soviet Union in 1991, Russia’s navy was reduced in size, and many new weapons systems were canceled while weapons were mothballed.

Under Russian leader Vladimir Putin, the navy is getting substantial funding for new weapons systems, with the goal of restoring Soviet-level power by 2020, according to the 68-page December report, “The Russian Navy: A Historic Transition.”

The publication seems to be evidence of further U.S. government recognition that Russia, following its military annexation of Ukraine’s Crimea last year, is emerging as an elevated strategic threat.

Russia also is proliferating advanced weapons to other countries. “The quantity and quality of the ships, submarines, and armaments sold will transform the current capabilities of recipient states and, in some cases, potentially enable them to improve the quality of indigenous arms production,” the report says.
[quote]
http://in.rbth.com/economics/cooperatio ... mph_555015

Austin · Post by **Austin** » 31 Dec 2015 09:08

udaym wrote:
Kremlin officials suspect that the aim of Saudi policy is to force Russia to the negotiating table, compelling it join Opec in a super-cartel controlling half the world’s production...
Low prices may be designed to create unrest and throw him out of the office, more than dragging to the table. What if oil goes to $25?? Combination of economic sanctions, low oil revenues, and higher expenses from being dragged into ME wars if not managed properly, can create deep economic stress, just in time for the opposition parties to cry mismanagement in 2018 (re)elections.

Oil prices have not fallen from $100 to $35 over period of 1 year because OPEC just increased its quote by mere 1.5 million barrel per day but because there is genuine demand destruction and we are slowly but most certainly moving towards a global recession and deflation unseen since many decades perhaps since 1930

The rest are just mere talks by Saudis and others its something neither controls or the tight oil folks or Rosneft or BP or Exxon some other MNC.

Philip · Post by **Philip** » 31 Dec 2015 10:17

US self-sufficiency through shale oil has been the major reason. It no longer needs ME oil. It has also decided to pay back the Saudis and oilygarchies in the same coin,as it was they who triggered off the first pil crisis (with Kissinger) and made trillions upon trillions and decades of unparalleled wealth at the cost of the rest of the world.No matter if western oil companies shared some of the loot! The boot now is on the other foot. Qataris,etc. have large gas reserves and will get by,but the Saudis ,promoters of Wahaabism are well and truly shafted.Nevertheless they have plenty of moolah to do mischief and a cornered rat will fight back.

Who can trust the US to play fair? They now want to impoe sanctions on Iran becos of its missile capability.What about Iran's enemies like the Saudis who've had Chinese BMs for decades and suspected of having Paki nukes too?

http://www.theguardian.com/world/2015/d ... mme-report
US planning new Iran sanctions over ballistic missile programme – report
Firms and individuals in Iran, Hong Kong and United Arab Emirates reportedly targeted following launch of missile in October

Austin · Post by **Austin** » 31 Dec 2015 11:15

US is not self-sufficient as such but still has to import more than 50 % of its crude

http://www.eia.gov/tools/faqs/faq.cfm?id=727&t=6

A_Gupta · Post by **A_Gupta** » 09 Jan 2016 20:27

http://sputniknews.com/world/20160109/1 ... india.html

KHABAROVSK (Sputnik) — Russia's Eastern Military District (EMD) Radiation, Chemical, and Biological Defense Troops (RChBD) are due to take part in two joint international military exercises with India and Mongolia in 2016, the EMD's press service said Saturday.

"The new year for the RChBD will be full of combat training events, which include RChBD unit personnel taking part in two international exercises: the Russian-Mongolian Selenga-2016 exercise and the Russian-Indian Indra-2016 exercise, as well as tens of special tactical exercises, hundreds of training and practical events on the district's polygons," the EMD press release said.

Read more: http://sputniknews.com/world/20160109/1 ... z3wlOjZeEh

NRao · Post by **NRao** » 13 Jan 2016 20:28

Interesting take:

IDN TAKE: Why Russia Stalled the Sale of S-400 and Akula-II Nuclear Submarine to India

Prem · Post by **Prem** » 14 Jan 2016 05:02

NRao wrote:Interesting take:

IDN TAKE: Why Russia Stalled the Sale of S-400 and Akula-II Nuclear Submarine to India

With Vietnam actively looking for, negotiating to get western warplanes and ASW warfare equipments, Russia losing both India and Vietnam because of China won't be good for Russian military industrial complex.

Austin · Post by **Austin** » 16 Jan 2016 12:08

India-Russia defence deal
Author:
Ashok B Sharma

http://echoofindia.com/reflex-action/in ... eal-101920

India’s time-tested friend Russia has come forward to be a partner in the ambitious Make-in-India initiative in sectors like defence manufacturing, nuclear power, solar energy, heavy engineering and railways. Defence is a critical sector for cooperation between the two countries. Moscow still remains as a major supplier of defence platforms and equipment even though India has made a conscious effort to diversify its import basket for new technology transfer and has inched towards US. Druzhba-Dosti has placed the relationship between the two countries on a firm footing, particularly in matters relating to defence and security despite resentments in the country on account of Russia supplying fighter jet engines to Pakistan.

Over the years it was a seller-buyer relationship. Now with the launch of the Make-in-India initiative in September 2014, greater emphasis is given to the manufacture of products in the country with adequate transfer of technology. To facilitate the implementation of the initiative the norms for attracting foreign direct investments (FDIs) in various sectors have been liberalized and ceilings have been raised. In defence sector the cap on FDI has been raised from 26% to 49% and for allowing FDIs above 49%, it would be considered on case-by-case basis keeping in view the need for technology transfer.

During his recent visit to Russia towards the end of the last year, Prime Minister Narendrabhai Damodardass Modi made a deliberate push for his Make-in-India initiative in the defence sector. An agreement was signed for manufacture of Kamov 226 helicopter in India which according to him would be “the first project for a major defence platform under the Make-in-India mission.”

“We have made progress on a number of other defence proposals. These would boost defence manufacturing in India and India’s defence readiness with next generation equipment,” he said.

According to the joint statement signed during Modi’s recent visit to Moscow under the caption – “Shared Trust, New Horizons” – both sides reviewed the achievements in the field of joint design, development and production of high-technology military equipment. They directed the concerned agencies to finalize such projects between relevant entities and enterprises of the two countries at the earliest.

In the 14th IRIGC-MTC held in New Delhi in January 2015, it was agreed to speed up the work on co-development of the fifth generation fighter jet. According to a Russian-Indian joint venture in charge of the project the engineers of both the countries had then completed a preliminary design for the Sukhoi/HAL Fifth Generation Fighter Aircraft (FGFA).

The Indian Defense Minister Manohar Parrikar invited Russian companies to come over to India for other joint projects, specifically the production of spare parts for Russia-made military equipment on the Indian soil. Indian army had a "substantial" amount of Russian and erstwhile Soviet Union military equipment in service, including heavy artillery and armoured vehicles.

Again in the area of renewable energy sector, a MoU has been signed between Solar Energy Corporation of India and Russian Energy Agency for construction of solar energy plants in the country. In the area of heavy engineering, a MoU has been signed with CNIITMASH of Russia for upgradation and modernization of Heavy Engineering Corporation (HEC) that was set with the help of erstwhile Soviet Union years ago. Also a Centre of Excellence for heavy engineering design would be set up at HEC. A MoU has been signed between Indian Ministry of Railways and the joint stock company – Russian Railways on technical cooperation. All these are a push for Modi’s Make-in-India initiative.

Cooperation space sector also holds out opportunities for promoting Make-in-India initiative. The first Indian satellite was launched using Soviet carrier launch vehicle about 40 years ago. A MoU has been signed between Indian Space Research Organisation (ISRO) and the Federal Space Agency of Russia in June 2015 on expanding cooperation in exploration and use of outer space for peaceful purposes. The joint statement has identified areas like rocket and engine engineering, development of spacecraft including microsatellites, earth remote sensing and space meteorology, satellite navigation and related technologies and services as well as space science.

Direct sale of rough diamonds to India initiated during President Putin’s visit to India in 2014 has helped the processing industry in India to export polished diamonds. Indian companies have signed up long-term rough diamonds supply contracts with PJSC ALROSA, bypassing the global diamond exchange. This has helped the Indian companies to source rough diamonds at cheaper prices. A Special Notified Zone has been set up at Bharat Diamond Bourse. Prime Minister Modi has remarked: “Following our last Summit, India has created a special notified zone to facilitate direct trade between the world’s largest uncut diamond exporter, Russia and India which processes 90% of the world’s uncut diamond.”

Russia is rich in hydrocarbons and recently the OVL has picked by 15% stake in the second largest oil field in Russia, Rosnett Vankorneft Oil Field and discussions are on for further stake in future. Moscow supplies LNG to India and a joint study group is considering the possibility of a hydrocarbon pipeline system between the two countries. The work on the proposed International North-South Transit Corridor (INSTC) is gathering pace with several meetings at the level of experts, stakeholders and INSTC Council. The INSTC through Iran is slated to reduce transportation time and cost and will connect Russia, Central Asia and South Asia. Custom authorities of Russia and India have planned to implement Green Corridor mechanism. India is also negotiating for a free trade agreement with the Eurasian Union. With such proposals in place New Delhi expects to increase its bilateral trade with Russia from a shade below $10 billion to $30 billion in the next 10 years and also give a boost to Make-in-India initiative at home. (IPA)
Friday, 15 January, 2016

member_20292 · Post by **member_20292** » 16 Jan 2016 14:46

Does a Su35 cost Russia 20 million USD only?
http://finance.yahoo.com/news/russia-mi ... 00310.html

How much does a India made MKI cost us? 60 mn USD? How come?

Ramana/mods - can we have a thread only relating to defence financing and calculations of costs? We dont have one at the moment...

habal · Post by **habal** » 16 Jan 2016 14:51

NRao wrote:Interesting take:

IDN TAKE: Why Russia Stalled the Sale of S-400 and Akula-II Nuclear Submarine to India

regards S-400 we do not need the missiles, we just need the sensors. If that can be provided somehow, it would be good enough.

Austin · Post by **Austin** » 16 Jan 2016 17:43

mahadevbhu wrote:Does a Su35 cost Russia 20 million USD only?
http://finance.yahoo.com/news/russia-mi ... 00310.html

How much does a India made MKI cost us? 60 mn USD? How come?

Ramana/mods - can we have a thread only relating to defence financing and calculations of costs? We dont have one at the moment...

Dont go by USD rates because Russian Spend in Roubles and Rouble has devaluated from 35 to USD to 75 USD where it is today but the money needed to buy Su-35 in Roubles is more or less similar to first batch amount they have procured.

Its like saying F-16 for US cost 100 billion roubles which does not make sense because US pays in USD.

USD rate is good for comparison purpose unless your import content is significant amount of the end product then it would impact the price , Much like Tejas cost around $25 million while a Gripen would cost $60 million

Austin · Post by **Austin** » 16 Jan 2016 17:47

habal wrote:
NRao wrote:Interesting take:

IDN TAKE: Why Russia Stalled the Sale of S-400 and Akula-II Nuclear Submarine to India
regards S-400 we do not need the missiles, we just need the sensors. If that can be provided somehow, it would be good enough.

They are procuring the entire system the sensor is no good without a missile to match or vice verse ,DAC just cleared the deal so price would be under negotiation.

As far as Akula goes I doubt they would disclose the deal is signed much like last time around we came to know 1 year before commisioning the sub , though the deal got signed some 7 years back

habal · Post by **habal** » 16 Jan 2016 18:15

Austin wrote:They are procuring the entire system the sensor is no good without a missile to match or vice verse ,DAC just cleared the deal so price would be under negotiation.

we could make the missiles ourselves, it is no big deal. Ofcourse we would need their permission to integrate the missiles with the sensor. A huge song and drama was being made of how we were importing 6000 S400 missiles. Then it all ended in a damp squib.

considering how the Russians have already decided to export these missiles to China, it doesn't make sense that they would restrict India from the same. But of recently I am noticing many discrepencies in Putin behaviour especially in his dealings with Modi. Is there a feeling within Kremlin that Modi is too pro-American and they are keeping their distance. I do not know. But the body language at meetings between Modi and Putin show often that Putin tries to take an upper hand by trying some cute stuff or another. Does he feel the need to assert himself ? anyhow if this deal hasn't gone through, which I have doubt in the first place because formal announcement of the deal apart there could be other issues in the works. I would like to lay the entire blame for this at the laps of the babus of foreign ministry who have been trying to travel in 2 ships at once. They want to act all goody-goody to USA knowing full well that no technology or missile defence of any substance is going to emanate from that quarter. And at the same time they want to play with Russia. You cannot travel with feet on two boats. If they want to go the US route then go with it totally, ocassionaly one may get chokeslammed by a small town cop or stripped at the airport but what the heck, atleast the kids will go to good colleges. There is a lot of indecisiveness in babudom in the past decade and it is India that has lost a lot of respect globally because of that.

krishna_krishna · Post by **krishna_krishna** » 17 Jan 2016 08:22

I think there is a lobby for both, Modi goes to anyone for whom there is national interest but russi ruffled from mmS days decided long before modi came to power that we are not dependable and are expandable compared to cheen and even pakis. We are in open with none to depend upon, massa uses us as soon as they have need for us. We have to back Russi's when they need because they have been dependable in past same cannot be said about masa. Till we are on our own, we have to be a powerhouse before we calls shots otherwise you will see these miserable days. Not a one comment by them on pathankot , you figure the rest

habal · Post by **habal** » 17 Jan 2016 08:26

krishna_krishna wrote:We are in open with none to depend upon, massa uses us as soon as they have need for us. We have to back Russi's when they need because they have been dependable in past same cannot be said about masa. Till we are on our own, we have to be a powerhouse before we calls shots otherwise you will see these miserable days. Not a one comment by them on pathankot , you figure the rest

the chief reason for this is numerous babus and politicians who make ad hoc decisions favoring unkil as and when they choose and they are in power to choose, reasons for this you can fathom .. but this kills off those who trust us and believe in us.

Paul · Post by **Paul** » 17 Jan 2016 08:39

In the big picture, the Russians are losing power and influence. They have decided their key threat is to their west and all efforts have to put to tackle the threat in their western region.

For this they have gone for an alliance with the Chinese and if this means they have to agree to Chinese terms they have to go with it.

The Indo Russian discord over arms is not a new phenomenon. The Russians have been threatening to sell arms to the Pakis since the mid 90s. It is only that the pakis do not have money to buy Sukhois and Helos that the deals are not going thru. The horse bolted from the barn the day they opened the door to sell Su-27 to the PLAAF.

What we need to watch for is if this is repeating with the Vietnamese....

Interesting part is if Russian turn away from India gathers speed Philip will have to take sanyas from the Forum.

NRao · Post by **NRao** » 17 Jan 2016 09:05

I just do not see the decisions being made by India as a problem. It is China that has entered the picture as a bigger player than previous years. Even if India had backed Russia, China would have mattered, perhaps not as much, but still they would have had a huge say.

Paul · Post by **Paul** » 17 Jan 2016 18:15

http://www.reuters.com/article/russia-f ... SL8N1500BL

UPDATE 1-Russia FinMin: budget to be short of over $38 bln at current oil price
(Adds detail, context)

Jan 16 Russian Finance Minister Anton Siluanov said in a television interview on Saturday that the fall in oil prices meant the Russian budget would be short of more than 3 trillion roubles ($38.6 billion) of income.

Russia's economy has been hammered by the collapse in global oil prices since mid-2014 as energy sales account for roughly half of federal budget revenues.

Its current budget for 2016 was calculated based on a Urals oil price of $50. Urals URL-E, Russia's main export blend, traded at around $27 on Friday.

"Therefore there is a difference of two times, and I want to say that for budget income this difference equates to over 3 trillion roubles," Siluanov said in an interview on the current affairs programme Vesti on Saturday with Sergei Brilev.

The oil price slide has also put pressure on the rouble, which is down over 50 percent versus the dollar since oil prices started a relentless drive downwards.

But Siluanov said the rouble had weathered the worst because oil prices could not fall as far as they already have from their previous peak.

"Our main export commodity, as we have already discussed, fell in price by four times," Siluanov said. "One can hardly expect prices to fall four times further compared to today's level."

He added that Russia could have to use part of its National Wealth Fund (NWF) to cover the budget deficit in 2016, if measures were not taken to bring Russia's budget in line with the new oil price reality.

The NWF is one of Russia's two rainy-day sovereign funds, alongside the Reserve Fund. Part of the NWF is already invested in infrastructure projects.

($1 = 77.7450 roubles) (Reporting by Alexander Winning, Maria Kiselyova and Darya Korsunskaya; Editing by Richard Balmforth)

Philip · Post by **Philip** » 17 Jan 2016 19:08

No way if anyone turns away! However,last night on "Latitude",the strat. affairs prog. on Times Now,anchored by Maroof ,which features each week renowned experts from the world of defence,diplomacy,thinktanks,etc.,Indo-Russian relations was discussed.Whether there was a falling off in Indo-Russian relations as we widened our realtionships globally.

The two experts ,Karnad was one,said that this wouldn't happen.Russia was not going to disengage with India as India was far too important a long-time trusted friend with whom it had no beef with at all. Mr.Modi during his Moscow visit had categorically described Russia as our closest friend.Russia still will be our largest defence partner and the aim was now to expand the relationship in other fields,esp eco,where there were hurdles and bottlenecks in doing business with Russia.Some points.

Pak is too small a client for mil eqpt. to worry about.Russia may sell a few helos,etc. but nothing major that will affect India,unlike the US selling F-16s,missiles,Orions,etc.

All nations,both western and Russia will never part with full TOT for their top weaponry/systems.There are some things that they will not part with.So let's not fool ourselves.
However,the diff between Russia and the West was that it was willing to provide us with the cutting edge weaponry that made a difference,esp strategic systems like Akulas,Arihant/SSBN-sub help,BMos,MKIs,etc.,helping us to operate such systems,plus help in vetting some of our indigenous designs and assistance in many other sensitive projects which are classified ,which the West would never provide us with.

Russia has been consistent with support for our UNSC seat.However,BK was v. critical about our MEA,which literally begged every visiting delegation for support,very correctly pointing out that this forced us to "make compromises" an cut deals with these smaller nations. We should be aloof and stand dignified on our own,secure in our own size and strength,where it would be inevitable and impossible not to leave India out of the UNSC when it was reconstituted.

Diplomatically,Indian and Russian viewpoints meshed with each other on many global issues.In Afghanistan,earlier,it was India,Russia and Iran who supported the Central Asian "Northern Alliance" and once again our collaboration in Afghanistan is vital.

Though China ad Russia are now much closer than before,the relationship was not on the same plane as that with India.There was more economic business rather than strategic cooperation between the two in comparison with India.Indian investment in Russia was also on the upswing in energy projects,etc. In the current global eco-meltdown,Indo-Russian eco relations would see an upswing out of necessity.

NRao · Post by **NRao** » 17 Jan 2016 19:50

The problem is not Indo-Russian relations. Never will be.

However, the shadow cast by China will, without a doubt, impact it. Cannot blame anyone, nor can one bury their head in the sand and trumpet old thinking. Or use bold fonts and emoticons.

No matter what I feel what is happening is good for India. India will have to endure a period of great pain, but that IMHO is good.

And, just BTW, distorted news to feel good really has no place here.

NRao · Post by **NRao** » 18 Jan 2016 03:05

"Our main export commodity, as we have already discussed, fell in price by four times," Siluanov said. "One can hardly expect prices to fall four times further compared to today's level."

A week or so ago, I had come across an article that claimed that the price could reach as low as $7-15 a barrel. Cannot find it right now, so I googled for cost by nation:

http://money.cnn.com/interactive/econom ... il/?iid=EL

RoyG · Post by **RoyG** » 18 Jan 2016 11:29

GRU Chief Igor Sergun possibly killed in Beirut. Big news if true.

Deputy Chief of Staff of the Airborne Forces Major-General Alexander Shushukin also died recently.

Russian military trying to wrestle power away from Putin? FSB maybe bumping biggies off.

Austin · Post by **Austin** » 18 Jan 2016 12:08

RoyG wrote:GRU Chief Igor Sergun possibly killed in Beirut. Big news if true.

Deputy Chief of Staff of the Airborne Forces Major-General Alexander Shushukin also died recently.

Russian military trying to wrestle power away from Putin? FSB maybe bumping biggies off.

The source was STRATFOR and as per wiki leaks STRATFOR source for Moscow news in past has been guy in moscow bar

Gyan · Post by **Gyan** » 18 Jan 2016 13:28

IIRC the Gross Price of first lot of 40+10 Su-30s in 1994-96 was USD 30 million with the aircraft alone being USD 20 Million. Subsequently the Gross price has gone up many times over.

NRao · Post by **NRao** » 18 Jan 2016 14:11

Just how low can oil prices go and who is hardest hit?