India’s defence minister Rajnath Singh said the country intends to order weapons from the domestic arms industry worth over $100bn (£77bn) over the next decade
By Eastern EyeJul 13, 2023
INDIA’S multi-billion-dollar purchases of US arms are less about shifting its reliance on Russian defence equipment and moving towards the West - it’s more about developing its own domestic weapons industry, security officials and analysts say.
India is the world’s biggest arms importer, but almost all of its major weapons purchases now include provisions for joint manufacture or technology transfer, irrespective of which country it is dealing with.
Also, Russia’s war in Ukraine has disrupted some military supplies to India, reinforcing New Delhi’s long-term desire to diversify imports or replace them with home-built hardware, Indian defence officials said.
India bought weapons worth more than $60 billion (£46bn) in the last 20 years, of which 65 per cent or nearly $39bn (£30bn) were from Russia, according to Stockholm International Peace Research Institute data.
Defence minister Rajnath Singh said India intends to order weapons from the domestic arms industry worth over $100bn (£77bn) over the next decade.
“It is a reality, that we have to reduce dependence on Russia,” said a senior Indian defence officer working on future capabilities of the Indian military, who declined to be identified. “But that is part two. The part one is the effort to get out of the import business.” India announced significant purchases of US defence equipment during prime minister Narendra Modi’s state visit to Washington last month, including an order worth more than $1bn (£770m) for GE engines for fighter jets.
Narendra Modi with president Joe Biden and first lady Jill Biden while on a US visit in June
A possible $3bn (£2.3bn) billion deal for MQ-9B SeaGuardian drones is also being discussed. In line with New Delhi’s desire for self-reliance in defence and Modi’s flagship “Make in India” policy, the jet engine deal includes joint manufacturing in the future, while the assembly and maintenance of the SeaGuardians will likely be in India.
The US ambassador to India, Eric Garcetti, said Washington had earlier paid “lip service”, but was now easing India’s access to military technologies. He said the US was “leaning in with technology” sharing more with India than it had with some its closest allies.
However, the moves so far will not be sufficient to end New Delhi’s reliance on Russia while stringent US rules governing the sharing of military technology limit future possibilities for now.
“Nobody gives you everything. They keep you at least a screwdriver away from having it fully,” said a second senior official from India’s defence ministry, who also spoke on condition of anonymity.
Rafale fighter jet
Arzan Tarapore, an Indian security expert at Stanford University, said the deals announced during Modi’s visit “do not in themselves represent an Indian shift away from Russia.”
“A big shift away from Russia will take multiple decades,” he said.
India still uses mostly Russian technology for traditional arms. Tarapore said the biggest potential for US-India collaboration should be on new systems that India doesn’t already have. Delhi’s main aim is to narrow the technological gap with better-armed neighbour China, with which it has a tense relationship, and which is also closely allied with Pakistan.
One problem for India is that Russia’s war in Ukraine has hit Moscow’s ability to deliver weapons and equipment.
A MQ-9B SeaGuardian drone
India’s Air Force recently informed a parliamentary panel that Russia would delay deliveries of spares for Sukhoi Su30 MKI and MiG-29 jet fighter planes. A big-ticket item, believed to be the remaining two of the five Russian S-400 air defence systems India bought for nearly $5.5bn (£4.2bn) in 2018, has also been delayed, it said.
India has also been expecting to receive two nuclear-powered attack submarines from Russia over the next few years, but these might also be delayed, defence officials said. Such problems have reinforced India’s resolve to become less dependent on Russia, but it does not want to rely on any one nation for its weapons purchases, they said.
It is buying French fighter jets, Israeli drones, American jet engines and potentially German submarines. Over time these purchases will reduce the share of Russian military technology used by India, but this would take at least two decades, Indian officials said.
Bill Greenwalt, a former senior Pentagon official for industrial policy, said the days of US and Russian domination of the global defence market and being able to control defence technology was coming to end, but what would replace it was “still a work in progress.”
Russia’s S-400 missile air defence systems
He said India could become frustrated by the strict US export control system for armaments and the restrictions it places both on technology sharing and its ability to develop systems it acquires. “I expect India will pursue cooperation with the west with those countries that can transfer technology,” he said.
Exports to India must satisfy stringent US International Trafficking in Arms (ITAR) regulations and the two countries are not treaty allies - which for instance means the level of technology sharing provided under the AUKUS deal to supply Australia with nuclear-powered submarines is not on the cards.
Even so, Modi’s US visit has been hailed by both sides as bringing the relationship to a new level. Besides the defence deals, the two countries also signed agreements on chips, space, artificial intelligence and critical minerals.
India is also a member of the QUAD alliance with the US, Japan and Australia, which deepens its ties with the West, but does not replace its decades-old relationship with Russia.
Derek Grossman, a Rand Corporation defence analyst, said the US would always be cautious in what military hardware and technology it shares with India because of this.
Even if India can transition away from Moscow over the next few decades, Grossman said, “the US will still have suspicions about how their systems are being used and how that might help the Russians in some sort of way, because of that close India-Russia partnership.”
“India is going to be opportunistic in this situation and accept whatever the US is willing to offer. But I don’t think they are willing to give up what they have with Russia.” (Reuters)
THE UK economy expanded at its fastest pace in a year during the first quarter of 2025, driven by a rise in home purchases ahead of a tax deadline and higher manufacturing output before the introduction of new US import tariffs.
Gross domestic product rose by 0.7 per cent in the January-to-March period, the Office for National Statistics (ONS) said, confirming its earlier estimate. This was the strongest quarterly growth since the first quarter of 2024.
Growth for March was revised up to 0.4 per cent from a previous reading of 0.2 per cent, according to the ONS.
The increase followed growth of just 0.1 per cent in the fourth quarter of 2024. However, GDP fell by 0.3 per cent in April from March, a decline affected by one-off factors.
Outlook for Q2 and pressure on budget targets
The Bank of England expects the economy to grow by about 0.25 per cent in the second quarter of 2025.
Finance minister Rachel Reeves is hoping for stronger growth to reduce pressure to raise taxes again later this year in order to meet her budget goals.
Thomas Pugh, chief economist at RSM UK, said weak consumer spending and hiring data in recent weeks likely reflected a short-term reaction to an employer tax increase and the US tariffs, many of which have now been suspended.
"Now that uncertainty has started to recede, consumer confidence is rebounding, and business surveys point to the worst of the labour market pain being behind us," Pugh said.
A separate survey published on Monday showed employer confidence in Britain had reached a nine-year high, with businesses more optimistic about the economy.
Interest rate cuts expected; energy prices a risk
The Bank of England is expected to cut interest rates two more times in 2025, which could support household spending.
However, a renewed rise in energy prices caused by further conflict in the Middle East could add pressure to the already slow-growing economy.
According to Monday’s ONS data, household expenditure grew by 0.4 per cent in the first quarter, revised up from an initial estimate of 0.2 per cent. The increase was led by spending on housing, household goods and services, and transport.
The UK property market saw increased activity ahead of the 31 March expiry of a tax break for some homebuyers.
Savings fall, manufacturing rises
Households drew from their reserves to support spending, with the saving ratio falling for the first time in two years. However, at 10.9 per cent, it remained high.
Manufacturing output rose by 1.1 per cent in the first quarter, ahead of the US tariff increase in April, compared with the final quarter of 2024.
The ONS also reported that the UK’s current account deficit widened to 23.46 billion pounds in the January-to-March period, up from just over 21 billion pounds in the previous quarter.
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RUSSIAN oil major PJSC Rosneft Oil Company is in early discussions with Reliance Industries to sell its 49.13 per cent stake in Nayara Energy, an Indian energy company that operates a 20-million-tonnes-per-year oil refinery and 6,750 petrol pumps, sources familiar with the matter said.
The deal, if finalised, would see Reliance overtake state-owned Indian Oil Corporation (IOC) to become India’s largest oil refiner. It would also provide Reliance with a significant expansion in fuel retailing, where it currently holds a relatively small presence.
The talks, however, are still at a preliminary stage and may not lead to a final agreement, primarily due to differences in valuation, according to three sources with direct knowledge of the matter.
Top Rosneft executives have visited India at least three times in the past year, including stops in Ahmedabad and Mumbai, to hold talks with potential buyers.
Rosneft is seeking to exit Nayara, which it acquired in 2017 (then Essar Oil) for approximately $12.9 billion (around £10.2bn).
Western sanctions have made it difficult for the Russian firm to repatriate earnings from its Indian operations. A suitable buyer, ideally with significant international revenues or foreign ownership, would be able to process cross-border payments more easily.
Reliance, a major exporter of petroleum products, fits that profile. However, a spokesperson for the company said: “As a policy, we do not comment on media speculation and rumours. Our company evaluates various opportunities on an ongoing basis.”
UCP Investment Group, a major Russian financial firm, which holds a 24.5 per cent stake in Nayara, is also looking to sell. The remaining shareholders include Trafigura Group (24.5 per cent) and a group of retail investors. Sources said Trafigura may also consider exiting the company if a deal is struck, possibly on the same terms.
Rosneft had initially valued Nayara at $20bn (approximately £15.8bn), a figure considered too high by most interested parties.
Adani Group declined the opportunity, citing both the high price and its existing agreement with TotalEnergies to limit future investments in fossil fuels.
Saudi Aramco has also expressed interest in Nayara, which would support its long-term goal of securing a downstream presence in India, the world’s fastest-growing oil market. However, Aramco too finds the valuation steep. Talks between Rosneft and Aramco reportedly have not advanced beyond initial engagement.
Nayara may make the most strategic sense for Reliance. The company already operates two massive refineries at Jamnagar, Gujarat, with a combined capacity of 68.2 million tonnes per year, located near Nayara’s facility in Vadinar. Acquiring Nayara would help Reliance surpass IOC’s total refining capacity of 80.8 million tonnes per year and significantly increase its retail footprint.
Nayara’s 6,750 fuel stations contrast sharply with Reliance’s 1,972 outlets in a market with over 97,000 petrol pumps. “Oil refining alone is not profitable — unless you have marketing, you can’t make money,” said one industry official.
While Rosneft has reportedly reduced its asking price to $17bn (around £13.4bn), the valuation remains a sticking point for interested parties. No formal offers have been announced, and Rosneft has yet to issue an official statement on the matter.
(PTI)
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Vedanta Resources, which is based in the UK and owned by Indian billionaire Anil Agarwal, has been working on reducing its debt. (Photo credit: Getty Images)
VEDANTA LTD said on Thursday that its parent company, Vedanta Resources, has signed a loan facility agreement worth up to £438 million with international banks to refinance existing debt.
The refinancing move, where old loans are replaced by new ones, often at better terms like lower interest rates, has led ratings agencies such as S&P Global Ratings and Moody's to upgrade their outlook on the company this year.
According to Vedanta's exchange filing on Thursday, the lenders involved in the deal include Standard Chartered Bank and its Mauritius unit, First Abu Dhabi Bank, Mashreqbank, and Sumitomo Mitsui Banking Corp.
Vedanta Resources, which is based in the UK and owned by Indian billionaire Anil Agarwal, has been working on reducing its debt.
The company lowered its net debt by £876m, bringing it down to £8.1 billion in fiscal 2025.
(With inputs from Reuters)
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Trump said that while deals are being made with some countries, others may face tariffs.
US PRESIDENT Donald Trump on Friday said a "very big" trade deal could be finalised with India, suggesting significant movement in the ongoing negotiations between the two countries.
“We are having some great deals. We have one coming up, maybe with India. Very big one. Where we're going to open up India," Trump said at the “Big Beautiful Bill” event at the White House.
The president also mentioned a trade agreement with China but did not provide details. "Everybody wants to make a deal and have a part of it. Remember a few months ago, the press was saying, 'You really have anybody of any interest? Well, we just signed with China yesterday. We are having some great deals," he said.
‘Some we are just gonna send a letter’
Trump said that while deals are being made with some countries, others may face tariffs. "We're not gonna make deals with everybody. Some we are just gonna send a letter saying thank you very much, you are gonna pay 25, 35, 45 per cent. That's an easier way to do it," he said.
Trump's comments come as an Indian delegation led by chief negotiator Rajesh Agarwal arrived in Washington on Thursday for the next round of trade talks with the US.
Talks ahead of July 9 deadline
Both countries are working on an interim trade agreement and are aiming to conclude it before July 9. The US had announced high tariffs on April 2, but the Trump administration suspended them until July 9.
Agriculture and dairy remain sensitive areas for India, which has not included dairy in any of its free trade agreements so far. India is cautious about offering duty concessions in these sectors.
The US is seeking duty reductions on items such as industrial goods, automobiles (especially electric vehicles), wines, petrochemical products, dairy products, and agricultural goods like apples, tree nuts, and genetically modified crops.
India, on the other hand, wants duty concessions for sectors such as textiles, gems and jewellery, leather goods, garments, plastics, chemicals, shrimp, oil seeds, grapes, and bananas.
ASDA, one of Britain’s largest supermarkets, has reported a pre-tax loss of £599 million for 2024, swinging sharply from a £180 million profit the previous year.
The loss comes despite total sales rising by over £1 billion to £26.8bn, as the retailer faces mounting debt costs, falling sales, and spiralling spending on a major IT overhaul, the Telegraph reported.
The main blow to Asda’s finances has come from its heavy debt load, a legacy of its £6.8bn buyout by the Issa brothers and private equity firm TDR Capital in 2021.
According to the report, the company’s debt pile, now close to £5bn, has become much more expensive to service as interest rates have risen. Last year, finance costs jumped by 38 per cent to £611 million, up from £441 million the previous year
Asda said it was forced to pay higher rates after refinancing part of its debt, putting further pressure on its bottom line.
Another major factor behind the loss is the ongoing “Project Future” – Asda’s multi-year plan to separate its computer systems from former owner Walmart. The project has been beset by delays and cost overruns, with total spending now approaching £1bn, far above its original budget
Last year alone, Asda spent £310m on the IT transition, which has included job cuts and outsourcing as the company tries to control costs. Problems with the new systems have also led to pay errors for thousands of staff.
While overall revenue rose thanks to new store openings, underlying sales have slipped. Like-for-like sales, excluding fuel, fell by 3.4 per cent to £21.7bn, with food sales down 3.7 per cent.
Meanwhile, Asda’s share in the UK grocery market has dropped to a record low of 12.1 per cent, with the retailer losing ground to rivals such as Tesco, Aldi, and Lidl
Despite efforts to win back shoppers with price cuts and a new convenience store push, Asda was the only major supermarket to report a sales decline in recent months, analysts said.
The company’s results were also hit by a £378m impairment charge, reflecting a drop in the value of its stores and assets. These one-off costs, combined with the IT spending, were singled out by Asda as the main reasons for the headline loss.
“The reported overall loss is the result of two significant one-off costs,” an Asda spokesman said, pointing to the impairment and Project Future costs. “These are not recurring costs and do not reflect the underlying performance of the business”
Allan Leighton, who returned as chairman last year, has launched a price war and cost-cutting drive to try to restore Asda’s fortunes. He has described many of the company’s problems as “self-inflicted” and is aiming to “turn it into what it was”. However, he has warned that a full recovery could take several years.
Despite the bleak headline numbers, Asda insists its core business remains profitable, with a pre-tax profit of £115m before exceptional items. Adjusted earnings before rent also rose slightly to £1.14bn.