Visitors in front of a giant billboard of Swedish Saab JAS 39 Gripen at the aerospace exhibition in Bangalore, India. | Photo by EPA/ Jagadeesh Nv
Posted on 06/19/2015 10:34:01 AM PDT by sukhoi-30mki
Peter Hultqvist, Sweden’s defense minister since last October, maintains a hectic schedule trying to supply his pared-down armed forces with enough equipment, manpower, and skills to mount a credible defense against a certain neighbor across the Baltic Sea. And earlier this month, the affable minister traveled to India on a different mission: promoting Sweden’s JAS Gripen fighter jet to the Indian government, which had seemed more keen on France’s Rafele as it looks to boost its air force.
“What’s happening with regards to a Sweden-India fighter jet deal right now is that there are talks,” explains Sam Perlo-Freeman, head of the military expenditure program at the Stockholm International Peace Research Institute (SIPRI). “In India the arms wheels wind very slowly, and as the French have discovered, it takes a long time to get a deal.”
The reason countries go for Sweden is that it’s not only affordable but offers technology transfer as well. But Sweden — whose large arms industry dates back to its Cold War neutrality — now seems to have a leg up on France. During a visit to the Swedish city of Linköping, where Saab manufactures JAS Gripen, Chief Minister Devendra Fadnavis of Maharashtra tweeted a photo of himself in a Gripen plane, thanking Saab for its interest in his state (whose capital is wealthy Mumbai). That’s because the Swedes have, according to Fadnavis, offered Gripen manufacturing in his home state.
In April, France and India agreed on an Indian purchase of 36 off-the-shelf Rafales, made by the firm Dessault. While not negligible, the $5.5 billion deal is a far cry from the $12 billion, 126-plane deal originally in the works. The sticking point: The Indian government wanted 108 of the planes to be made in India. “JAS Gripen fills the niche for an affordable combat aircraft, and Sweden is willing to engage in high-level technology transfer,” notes Perlo-Freeman. “If countries want the absolute best military equipment and can afford it, they buy from the United States. If they don’t have as much money, they buy from Russia, and if they’re really poor, they buy from China. The reason countries go for Sweden is that it’s not only affordable but offers technology transfer as well. That’s important for India, which has been trying for decades to develop an arms industry.”
Sweetening the deal
Given their access to a large domestic market, American arms don’t depend on foreign deals and don’t need to offer technology transfer. By contrast, European arms manufacturers would struggle to survive without exports, and as a result enthusiastically sweeten their offerings with technology transfer. In this case, however, Dessault appears to have dragged its feet, unwittingly giving Saab an opening. And there he was, Defense Minister Hultqvist, on a four-day visit to India that included talks with Defense Minister Manohar Parrikar. (Interestingly, the widely respected Hultqvist — a social democrat — performed most of his military service in the criminal justice system, claiming conscious objector status.) Saab did not respond to a request for comment on the status of the India talks.
Critics argue that Sweden’s arms exports feature many distinctly murky practices. Back in Linköping, residents and politicians unwaveringly support Saab’s energetic salesmanship. “Today the Swedish military buys less than in the past,” notes Paul Lindvall, the city’s deputy mayor as well as its former mayor. “That’s why foreign customers are good not just for Saab but for the whole city.” Saab employs some 5,000 people in Linköping. In total, the city’s aerospace industry provides some 15,000 local jobs, making it the most important industry in the city of 150,000. “Linköping has developed in symbiosis with Saab and we’ve gained a university and a phenomenal science park as a result of Saab’s presence in our city,” says Yvonne Rosmark, the city’s business director. Two years ago, Linköping launched an aerospace cluster, which now boasts 50 members.
And a Saab contract with India would be a huge boost for Linköping. JAS (the acronym stands for jakt, attack, spaning: hunt, attack, surveillance) Gripen was long considered an also-ran on the global market, but Saab’s fortunes turned last fall with a $900 million deal from Brazil, where Sweden again offered technology transfer, including a research center in San Bernardo. One hundred Brazilian aerospace engineers and their families are expected to move to Linköping as part of the deal. “The Brazilian order, and one from the Swedish government, came just at the right time, as Saab had fulfilled its existing orders,” says Lindvall.
Rather unsurprisingly, Lindvall and his fellow local politicians do their best to help the city’s biggest employer. “When we consider partnering with new sister cities, we obviously think about which ones might be good for Saab,” he reports. “And we try to offer good school arrangements for foreign workers’ children.” Lindvall and his colleagues are now trying to figure out how to provide schooling for the Brazilian engineers’ young children. And, he reports, locals with Portuguese language skills have contacted him volunteering their assistance.
Who really benefits?
While offering potential buyers technology transfer and help with schooling is completely legal, critics argue that Sweden’s arms exports feature many distinctly murky practices. “During Sweden’s campaign trying to sell Gripen to Switzerland last spring, Sweden used design, rock concerts and a royal visit to help create a positive image of Sweden and thus Gripen,” notes Anna Ek, president of the Swedish Peace and Arbitration Society. “The government’s involvement distinguishes arms trade from other trade. And yet the arms companies’ profits benefit mostly them, not the government.” The country also grapples with the issue of which countries make for acceptable buyers. On June 30, a parliamentary committee will present a long-delayed report on Swedish arms exports in which it’s expected to recommend a “democracy criterion” and stricter rules for follow-up deliveries. Arms manufacturers are already banned from exporting to dictatorships and countries at war, though the government has approved exceptions, including Afghanistan, Burma, and Iraq.
In addition, argues Ek, the potential deal with India not only stokes India’s latent fires with Pakistan but also evokes the specter of the Bofors scandal. The enormous 1986 contract, involving the sale of 410 howitzers — artillery pieces — by the Swedish firm Bofors to the Indian Army, featured negotiations by the countries’ respective leaders, Olof Palme and Rajiv Gandhi, but also unexplained Bofors payments to a Swiss bank account and the subsequent mysterious death of Sweden’s war materiel inspector on the Stockholm subway.
And corruption plagues the global arms trade, adding an estimated 40 percent to the cost of arms deals. Britain’s Serious Fraud Office discovered that a 1999 deal with South Africa for 28 (later 26) JAS Gripens, part of a major deal with Saab and BAE Systems, involved £115 million in BAE “commissions” to advisors. Two years ago the South African government, responding to a parliamentary question, revealed that though all the JAS Gripens had been delivered, due to a lack of funds and pilot expertise only 10 were operative.
In Brazil, anti-corruption prosecutors have opened an investigation into how the country’s $4.5 billion deal with Saab turned into a $5.4 billion one. (Saab says that it’s a result of additional Brazilian requests as well as fluctuating currency exchange rates.) Of course, that doesn’t suggest that there’s anything untoward about Hultqvist’s India visit, even if Saab ends up getting the contract. “I’d be very surprised if he offered his Indian counterpart money, but that doesn’t mean that corruption won’t happen at lower levels,” says Perlo-Freeman. “The arms trade process is opaque and thus very vulnerable to corruption, even if governments have good intentions.”
Elisabeth Braw is a correspondent for Newsweek, which she joined following a fellowship at the University of Oxford.
Visitors in front of a giant billboard of Swedish Saab JAS 39 Gripen at the aerospace exhibition in Bangalore, India. | Photo by EPA/ Jagadeesh Nv
Don’t they require journalists and editors to be able to spell anymore?
Not often.
Is missy Lizzy Braw a second grader?
I think most third graders can spell "peddler" correctly...
http://www.oxforddictionaries.com/definition/english/pedlar
Guess she had British sensitivities in mind since she’s writing for Politico (Europe).
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