U.S Gates to travel to India as arms deals blossom

U.S. Defence Secretary Robert Gates travels to India next week to strengthen diplomatic ties strained by an impasse over a landmark nuclear deal and push American bids for a lucrative $10 billion (5.1 billion pounds) fighter contract.

After decades of a pro-Soviet tilt, India has moved closer to Washington in recent years, with new arms sales and joint military exercises. Millions of Indians also are turning to the United States for education, jobs and consumer goods.

Gates' visit comes as U.S. companies Lockheed Martin and Boeing Co. are competing with Russian and European rivals for one of India's biggest ever arms contracts, a potential $10 billion deal to sell India 126 fighter aircraft.

Burgeoning arms deals may also help pacify Washington, frustrated at India's apparent climb-down over a nuclear deal with the United States that President George W. Bush had called "historic".

India's government put that deal, also known as the "123 agreement", on ice after opposition from its communist allies.

"Defence ties between India and the United States have begun to blossom," said C. Raja Mohan, a Singapore-based Indian strategic affairs expert.

It is no coincidence, defence experts say, that Gates' visit, which India says is due on Tuesday, comes just before a March 3 deadline for bids on the contract for 126 fighters.

"The clinching factor on this deal may be politics, which is why Gates is coming," said Indian security expert Ashok Mehta. "If you don't get the 123 deal, then a 126 deal would signify a real turn in relations with the United States."

REAPING THE BENEFITS

Closer ties have already reaped some benefits for U.S. business, including India's decision this year to buy six C-130J military transport planes from Lockheed worth about $1 billion.

Defence experts said it was one of India's biggest arms deals with the United States since the country's independence from Britain in 1947 and heralded New Delhi's shift towards being less dependent on Russia for military supplies.

"Defence ties form a significant part of the overall spectrum of the relationship with India. The relationship is broader than the civilian nuclear arrangement," said a senior U.S. defence official travelling with Gates.

Lockheed Martin's President South Asia, Richard Kirkland, told Reuters this week in Singapore that India could be the largest defence market in Asia with $20 billion in possible air force, navy and communications contracts over the next decade.

Russia still accounts for about 80 percent of India's foreign military supplies, according to Mehta.

"India no longer wants its military eggs all in one basket," Mehta said.

New Delhi and Washington's closeness hinges on a desire not only for more business but also to counterbalance China's rise.

Last year, for example, India's navy carried out one of its largest military exercises with the United States in the Bay of Bengal, along with Japan, Australia and Singapore.

An Indian government official would not say what the two sides would discuss next week, but said that Gates would meet India's Defence Minister, A.K. Antony.

"There will be a joint press conference," Sitanshu Kar, a spokesman at the Ministry of Defence, told Reuters.

Analysts said Gates could probably do little to push India to agree to the nuclear deal. Under the accord, India could import U.S. nuclear fuel and reactors despite having tested nuclear weapons but not signed the Non-Proliferation Treaty.

It could reap huge rewards for U.S. businesses.

But the leftists that India's governing coalition relies on for parliamentary support opposed it, and Prime Minister Manmohan Singh signalled last year he would not risk a snap election to push the deal through.

U.S. officials warned this month that time was running out to push the deal through under the Bush administration, and said India might never get the chance for such a deal again.

"There is nothing the Americans can do about it," said Mohan. "It's up to India to make a political decision to go ahead."