NEW DELHI — Despite the Indian Navy's serious reservations, the Ministry of Defence (MoD) has quietly permitted state-owned Bharat Electronics Limited to team up with Raytheon of the United States to complete the much-delayed network-centric operation project.
Bharat Electronics (BEL) was nominated by the MoD last year for the second time to build the network-centric operation (NCO) system at a cost of $100 million, and it is scheduled to be ready by early next year.
The system will link crucial assets including shore-based radar networks, aircraft and Indian Navy warships.
The Indian Navy has repeatedly told MoD that it is not in the national interest to acquire hardware and encryption software for the NCO project from a partnership with a foreign company.
"It is not feasible for any sovereign nation to weaken its operational doctrines and operational orders that would flow on" NCO networks developed with a foreign company, said a senior Indian Navy official, who spoke on condition of anonymity.
"However, the government has taken a complete U-turn and ignored our demand that NCO hardware should be fully developed by an Indian company and encryption software by the Indian Navy itself," the official added.
The NCO project can succeed only if BEL uses sufficient domestic content for the hardware and develops the software completely in India, either in-house or by teaming up with Indian companies, said another Navy official said, adding that Raytheon will have to obtain International Traffic in Arms Regulations (ITAR) clearance.
"Even if BEL can make a successful NCO system with Raytheon, the bigger question is upgrades — after five years the hardware will become obsolete and software upgrades will require hardware upgrades," a defense analyst said, who spoke on condition of anonymity.
Kiran Visweswaraiah, general manager of international marketing at BEL, said: "We have teamed with Raytheon in January this year and by mid next year [the NCO] will be successfully inducted into Indian Navy."
An executive with Raytheon, who spoke on condition of anonymity, confirmed that the company has partnered with BEL for the NCO program and will provide software solutions.
According to Shyam Kumar Singh, a retired Indian Navy captain: "BEL and Raytheon will be able to deliver a successful NCO prototype."
Singh said Raytheon has already delivered advanced systems to the Indian Navy through BEL, including the Athena system, a battle space information network which integrates a wide range of inputs.
In 2011, Raytheon was selected as the lowest bidder for a global NCO tender but the contract was called off because it did not agree to a full technology transfer to BEL, the nodal agency to build NCO system.
The Indian Navy had floated a global tender for an NCO project in 2007, which was sent to Lockheed Martin and Raytheon of the United States, Thales of France, EADS of Germany, Israeli Aerospace Industries (IAI) and Rafael of Israel, and BAE Systems of the United Kingdom.
In 2011, Raytheon emerged as the lowest bidder followed by IAI and Rafael of Israel. But talks with Raytheon were called off after the firm refused to agree to a full technology transfer to BEL, the designated final production agency, an MoD source said.
In 2012, BEL forged a partnership with Selex Sistemi Integrati S.p.A., a subsidiary of Finmeccanica Group of Italy to build the NCO system jointly with BEL, but was later barred from participating after the Indian government disqualified large Italian companies following charges of alleged corruption by AgustaWestland S.p.A.
Once the NCO system is operational, it will be deployed near New Delhi and will be networked with over 100 warships in the following five years.
Email: vraghuvanshi@defensenews.com
Vivek Raghuvanshi is the India correspondent for Defense News.
