US-India defence deal 'to counter China'

[Steve Gardner]

I fear the worst for US-China relations. They both have an insatiable appetite for oil, they're both trying to exert their influence around Asia and Africa and they're both militarising at extraordinary rates.

It does seem though that China has the US a little by the balls to the extent that it holds around $1 trillion in reserves and a whole load of $-denominated debt. It can, if it so chooses, use these holdings tomess with US fiscal policy in a big way.

Source: The Telegraph

America is attempting to forge a strategic alliance with India with a series of arms deals as the South Asian nation bolsters its defences against China.

Robert Gates, the US defence secretary, will arrive in New Delhi to strike a common position on Beijing with the Indian government.
India has become one of the largest buyers of defence equipment

His arrival comes as New Delhi decides whether the US firms Lockheed Martin and Boeing, or Russian and European rivals, will win a contract to supply the Indian air force with 126 combat aircraft in a £5 billion deal.

But the wider battle is for influence in Asia, with America seeking to shore up a tentative and controversial alliance with what it sees as a democratic counterweight to China.

One senior Indian military official said Washington was hoping to supply up to a quarter of India's military hardware over the next decade as its current stocks, predominantly originating in Russia or the former Soviet Union, become obsolete.

"Washington views Delhi as representing a strategic asset in the Asian region," the official said.

America has already agreed to help India develop civilian-use nuclear power despite New Delhi's failure to sign the nuclear non-proliferation treaty and its insistence on retaining its nuclear weapons arsenal.

That deal has met an impasse due to opposition from the Indian Communist Party, which sustains the coalition government of Manmohan Singh, the prime minister.

The Communists regard it as a "hegemonic" ploy to "enslave" India.

But many analysts see growing ties as inevitable as a post-Cold War realignment of strategic interests continues.

As the United States and China, which once saw themselves as informal allies against the Soviet Union, eye each other warily, Beijing has aligned itself diplomatically with Moscow.

The US, by contrast, regards India, which used to receive support from Moscow, as a natural ally.

"If the India-US civilian nuclear deal collapses, it will not impact on the growing military ties between the two countries," William Cohen, a former US defence secretary, said at a recent arms fair in New Delhi at which American companies were well represented. "In fact I see them growing."

According to the International Institute of Strategic Studies, India's military expenditure grew by 24 per cent last year, as it has become one of the largest buyers of defence equipment.

India's defence purchases are projected to double to more than £15 billion by 2012, climbing to £40 billion by 2022.

China, too, has been on an arms-buying spree in recent years and has also been developing its own capacity to build missiles, fighter jets and submarines.