Modi takes a chance by buying Putin’s missiles


By Cornelia Meyer
 The telephone lines between New Delhi and the US State Department were burning at the weekend as Washington sought to dissuade Indian Prime Minister Narendra Modi from signing a $5.4 billion deal with Russian President Vladimir Putin to buy the S-400 air defense missile system — one of the most sophisticated surface-to-air systems in the world, with a range of up to 400km.

India risks triggering penalties under CAATSA, the Countering America’s Adversaries Through Sanctions Act, which is designed to ensure international adherence to US sanctions against Iran, North Korea and Russia. Modi is taking a calculated gamble. Over the past decade or so, India has opened up its economy, and with it has been able to strike an economic and strategic partnership with the US. America is increasingly wary of India’s northern neighbor, Pakistan, and therefore ratcheted up its relationship with New Delhi. US companies also do not want to forgo the Indian market of 1.3 billion potential customers. India’s leaders seem confident that they can manage US dissatisfaction with this defense deal. Modi can also argue that he needs to keep safe his 400km frontier with China and the northern border with Pakistan. The Indian budget has no capacity to accommodate the transaction this year and the first missiles will not be delivered until 2020. A lot can happen in two years, which gives the Indian government further wiggle room.

Much has been written about India’s need to obtain spare parts for its arsenal of legacy Soviet arms. They were purchased during the Cold War, when India was a member of the non-aligned movement but close to the Soviet Union. Occasionally India will purchase new arms from Russia to guarantee an uninterrupted flow of spare parts. The S-400 system, however, goes further than that and has to be seen in the context of new geopolitical arrangements on the Eurasian landmass.

In 2001, Russia and China formed the Shanghai Cooperation Organization (SCO) with Kazakhstan, Kyrgyzstan, Tajikistan and Uzbekistan. India and Pakistan joined later. Afghanistan, Belarus, Iran and Mongolia have observer status. Turkey, Armenia and Azerbaijan are among a handful of dialogue partners. The SCO is the world’s largest transregional grouping by landmass and population. Its mission is to promote “good neighborly relations” in the areas of politics, trade, economy, science, technology and culture. There is also a huge defense component, with maneuvers at regular intervals. Some of the organization’s members are old foes — Pakistan and India, for example — and others worry about undue influence from China via One Belt One Road and other initiatives. Nonetheless. the countries meet regularly (the last time was in June in Quindao, China) and also hold joint military drills. Russia and China in particular have regularly teamed up for “war games,” most recently in September this year.

China uses the SCO to promote its aspirations on the Eurasian continent and beyond. Russia benefits by having “friends” in an increasingly hostile environment. The connectivity helps with defense deals, such as selling the S-400. Russia sold the missile system to China in 2014. SCO dialogue partner and NATO member Turkey signed a preliminary agreement with Russia to purchase the system last December — much to the discomfiture of the US military brass and the EU. Conversations are ongoing with Algeria, Belarus, Iran and Vietnam.

What is going on here goes well beyond Russia peddling its latest nifty defense technology. It is part and parcel of a geo-economic and geopolitical rearrangement of the Eurasian continent. China has become the world’s second largest economy and is set to overtake the US by the early 2030s.

At the same time the current US administration runs the risks of undermining the Pax Americana that we have taken for granted since the Second World War. The US was by and large the creator, and certainly the guarantor, of the postwar international order and its institutions, such as the UN, Bretton Woods, NATO and the WTO. The current administration is undermining those very institutions by chipping away at their authority and legitimacy. This creates vacuums. Wherever you have a vacuum, someone will fill it, which is quite legitimate. China is obvious in its quest for influence and power on the economic and military stage. Russia has suffered by the break-up of the Soviet Union and is taking a more stealthy route — nevertheless asserting its position as a regional power. America’s supremacy looks set to be replaced, at least in part by the likes of the Shanghai Cooperation Organization. It should come as a surprise to nobody that the shared values these new institutions are built on are not those of democracy and personal freedoms, which we have come to take for granted.

(Cornelia Meyer is a business consultant, macro-economist and energy expert. Twitter: @MeyerResources. Article courtesy Arab News)