If Rolls-Royce is barred, Jaguar, Hawk, C130J will be affected

 Former top officials of the Indian Air Force (IAF) in the City have said that barring Rolls-Royce (RR) from transacting business with Hindustan Aeronautics Limited (HAL) would hit IAF’s strikefighter Jaguar, the strategic transport aircraft C130J and the Hawk Advanced Jet Trainer (AJT).

It would bring their operations to a halt and severely impact the operational preparedness of the IAF. And financially, it would hit HAL and Defence Ministry in millions of dollars ($800 mn and above), and some say in an extreme case, the setback could be around $ five billion.

RR is now barred from transacting with HAL after RR admitted that it had hired a third party to secure engine contracts from Gas Authority of India Limited (GAIL) via HAL. The Defence ministry has now put on hold transactions with RR and would restore original ties only after a probe.

According to one estimate, the Jaguar requires an ideal supply of 180 engines for 90 aircraft considering it as a twin engine aircraft, Hawk would require 140 engines, and the C130J around six. Jaguar would mean costs of about $360 mn, the Hawk around $280 mn, and the C130J close to $800 mn. The figures here are only estimates by Defence insiders. Formal figures could vary from the estimates. The assessment, insiders say, is dependent on actual supply situation now.

Air Marshal Phillip Rajkumar told Deccan Herald IAF’s overhauling frequencies would be hit.
“Military aircraft keep flying and periodicaly engine overhauling is necessary. For overhaul, new spares may be necessary to replace old ones. And these spares are supplied by RR. If spares don’t reach the squadrons because of a ban, how will they fly an engine that needs overhaul?

The engine is kept idle. Squadrons come to a grinding halt and operations are hit. Stopping supplies will have serious impact.” Some aircraft may not be able to rely on only overhauled engines, but may require new ones. But phasing out the old ones can be undertaken only if new ones are coming in time, says Rajkumar.

Air Marshal B K Pandey’s reasoning echoes Rajkumar’s. “If engine supplies and spares stop, aircraft will be grounded. Pilots cannot undertake sorties. In a sense, this is an old problem.

We would suffer heavily with the MiG-21. We had to get around the supply chain problems with Russia. Their supply system had enough problems. Still we managed. HAL represents the supply chain in Bangalore and India. So halting ties with RR means choking the supply chain - HAL - and hurting operations of the squadrons. How can you sign a contract and then come to the point of blacklisting it or imposing a moratorium on it? I would call this a suicidal tendency.”

Pandey offers a way out of such imbroglios. “Separate the crime from the contract. If a problem arises, nail the criminal but retain the contract. The contract should not suffer or else supply chain gets choked. Jeopardising the contract means shooting yourself in the foot. After having spent energy and time to design the contract and come to a decision, why do you go back on it? The people need to be changed, not the pact itself.”

RR at present supplies engines to HAL for five aircraft adour engines for IAF’s strike fighter Jaguar, Adour Mk871 engines for the Hawk Advanced Jet Trainer (AJT), AE 3007 engines for Embraer Legacy Jets for VVIPs and surveillance duties, AE 2100 engines for the C 130J transport aircraft and RR Dart Engines for IAF’s transport aircraft, Avro. Engine costs vary according to size, type, capacity and the kind of aircraft it will be deployed in. On average a military aircraft engine may cost anywhere between $ 2 mn and 6 mn.

A contract for 99 GE 414 engines to be fitted into the Light Combat Aircraft Mark-II is costing India $600 mn with each engine costing roughly $6 mn. Keeping these high costs in view, IAF veterans suggest a different method of handling situations like the one RR is caught in. “You cannot invite global companies home and then let loose CBI or the courts on them. If there is something wrong, get the man responsible for it, and then get the loophole corrected and ask for a new team.

Cancelling the contract would mean we hit ourselves. In this age of rapid technological development, we have to be quick and rational in decision-making and equip ourselves well. We should explore financial penalties as one means to penalise the wrong-doers. Severe financial penalties may ensure that companies don’t mess with the country.”