AMR-June-July-2013

REGIONAL NEWS
A N D D E V E L O P M E N T S
s o u t h a s i a
ASIA PACIFIC PROCUREMENT UPDATE
by Pierre Delrieu
DISPUTE DIALOGUE
Chinese Premier Li
Keqiang and Indian Prime
Minister Manmohan Singh met
in New Delhi as part of the
newly-elected Chinese
Premier’s first visit abroad.
During talks on 19th May, they
discussed the boundary dispute
between their two countries.
Indian Defense Minister AK
Antony and National Security
Adviser Shiv Shankar Menon
announced they planned to
visit Beijing over the summer
to discuss means of resolving
the boundary dispute.
In April, troops from the
had been discussed with Prime
Minister Singh and passed off
as “an incident”.
Meanwhile, New Delhi
announced it would deploy an
additional 40,000 troops in the
form of a mountain corps to bolster
its strength on the Chinese
border, just a couple of weeks
after Prime Minister Keqiang’s
visit. According to Indian MoD
this deployment had been
planned for about 2 year and
had been waiting for approval
of Ministry of Finance.
This ongoing dispute
involves the longest contested
boundary in the world. China
SPENDING INCREASES
One week after taking
office, Pakistan’s new government
announced a ten percent
raise in defence spending,
despite a crippling budget
deficit of 8.8 percent. The budget
for fiscal year 2013-14 will
begin on 1st July amid a weak
economic growth, high inflation,
decreasing foreign
exchange reserves and unprecedented
power cuts. The new
budget will allocate 627 billion
rupees (US $6.3 billion) for
defence, a ten percent increase
compared to the 570 billion
rupees allocated in the outgoing
year, ending 30th June.
The army is the most
powerful institution in Pakistan,
a country ruled for half its life
by the military. Pakistani Prime
Minister Nawaz Sharif, who had
troubled relations with the army
in the past, took office in early
June after winning the 11th May
elections; marking an historic
transition of democratic power.
Finance minister Ishaq Dar
announced that the government
would clear $5 billion in circular
debt from the energy sector
within the next 60 days and
help minimize power cuts in the
country, but gave no details on
how the government would
find the necessary money,
considering Pakistan is still
paying off an $11.3 billion loan
made from the International
Monetary Fund in 2008. Years
of under-investment,
mismanagement and corruption
cause power outages of up
to 20 hours a day in the
Pakistani blistering summer
heat, when temperatures can
reach up to 50°C.
two countries came face-to-face
in the northern region of
Ladakh, when Chinese troops
entered nearly 10 kilometres
inside Indian territory across
the Line of Actual Control, the
de-facto boundary between the
two countries. The incident
threatened to increase tensions,
and Indian opposition parties
asked the government to take a
tough line against the Chinese
intrusion. However, during last
month’s visit of China’s premier
in New Delhi, the issue
claims 92,000 square kilometres
of Indian territory. The border
between India and China is
defined by the 4,056-kilometre
LAC, which is neither marked
on the ground, nor on mutually-accepted
maps.
Although the deployment of
additional troops along the border
is bound to raise tempers in
Beijing, analysts agree that
India and China can ill-afford
to go to war in the immediate
future as both seek to grow
their economies.
US-2 PROGRESS
India and Japan have
agreed to form a joint working
group to explore cooperation
on the US-2 amphibious aircraft
made by Japan’s ShinMaywa
during talk in Tokyo on 29th
May. Indian Prime Minister
Manmohan Singh and his
Japanese counterpart, Shinzo
Abe, agreed on a joint working
group to decide the terms of
this cooperation, which could
include joint production, operation
and training on the US-2.
The amphibian has a sensor fit
capable of detecting and tracking
surface vessels, ships, submarine
periscopes, and low-flying
aircraft and missiles.
TRI-PARTITE TALKS
In Canberra on 5th June,
Indian Defence Minister AK
Antony and his Australian counterpart,
Stephen Smith, agreed to
step up military exchanges and
naval combat exercises between
the two countries, as part of its
policy to strengthen defence ties
with countries in the Asia-Pacific
Region, including Thailand.
They agreed to pursue “a
regular bilateral Defence
Ministers’ meetings to promote
exchanges between the Defence
establishments and the Armed
Forces of both sides”, said the
Indian Ministry of Defence in a
joint statement issued after the
talks. Without specifying concerns
over Chinese assertiveness
in the South China Sea, the
statement added that: “maritime
security and freedom of
navigation in accordance with
principles of international law
is critical for the growth and
prosperity of the Asia Pacific
and Indian Ocean Region.”
AK Antony also said he
would discuss possible areas of
cooperation and collaboration
in defence production with
Thailand with his Thai counterpart,
Air Chief Marshal
Sukumpol Suwanatat.
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