Israel Raises Profile in India To Protect Market Share

By Neelam Mathews

Feb 18, 2015

 Israel's Defense Minister, Lt. Gen. (ret) Moshe Ya'alon, this week became the first Israeli defense minister to visit India, despite the fact that Israel is one of India’s top-three military technology trading partners and that the two countries have had full diplomatic ties since 1992.

Ya’alon told reporters at the Aero India show in Bangalore that the relationship between Israel and India is “finally out of the closet” and that his presence in the country is a sign of deepening relations.

Responding to Indian Prime Minister Narendra Modi's speech at Aero India, in which he indicated, as part of his “Make in India” campaign, there could be further liberalization of India’s defense procurement policies, Ya’alon was non-committal about whether this might result in Israel's agreeing to a higher degree of technology transfer. Modi said that the 49-percent limit on foreign direct investment in Indian defense companies could be raised for projects that deliver “state-of-the-art technology” to India.

The Israeli defense minister was in India less than a month after U.S. President Barack Obama came to the country pledging an increased degree of military sector cooperation for the country. Asked by AIN whether the new effort to boost the U.S. defense sector’s combined stake in the Indian market constitutes a threat to Israel’s position, Ya’alon responded: “We are not a superpower. We are open to competition. We believe the best will win.” Later this week, he is due to visit Delhi where he expects to finalize deals worth $1.4 billion for the purchase of two Israel Aerospace Industries Phalcon AWACS and four aerostat-mounted radar systems.

India has in the past bought three Phalcon AWACS that are mounted on Russian Ilyushin Il-76 aircraft.

Ya’alon also told reporters that his government hopes India will soon confirm the reported lifting of a ban on Israel Military Industries for alleged corrupt practices. The ban was imposed in 2009, but no charges ever resulted from an Indian investigation into the case.

The Israeli pavilion at Aero India featured 15 of the country's top defense companies. Equipment on display included air defense systems, UAVs, satellite systems, missiles, aircraft self-protection systems and electronic warfare systems.