India, US Ink First Military Contract after Tariffs Frictions

India, US Ink First Military Contract after Tariffs Frictions

After the Punitive US tariffs of 50 per cent imposed by the Trump-led administration that came into effect on August 27, India and the US signed a military contract on Friday, November 29. Notably, this is the first trade and tariff-related friction that strained a few months ago. The Ministry of Defence inked the letters of offer and acceptance with the US for sustainment support of the Indian Navy’s fleet of MH-60R helicopters.

Military Contract covers sustainment for the MH-60R

Around Rs 7,995 crore deal comes just a week after the US Department of Defence approved two separate sales worth $92.8 million for India, which is of Excalibur artillery ammunition employed during Operation Sindoor and Javelin anti-tank missiles. These two sales still require approval from the US Congress. The recent contract covers sustainment for the MH-60R, a specialised submarine-hunting helicopter operated from ship decks and shore bases.

A sustainment programme is a comprehensive package including spares, support equipment, product support, training and technical assistance, repair and replenishment of components and establishment of intermediate-level component repair and periodic maintenance facilities in India. The Ministry of defence said that developing these facilities domestically will aid in building long-term capability and decrease dependency on the US government, aligning with India’s vision of self-reliance.

Sustainment programme improves operational availability

This programme will improve the operational availability and maintainability of the MH-60R fleet. India has procured 24 of these helicopters, produced by Lockheed Martin, for $2.6 billion, deliveries beginning in 2011. The agreement was concluded under the US Foreign Military Sales (FMS) programme and will allow the helicopters to operate from dispersed locations as well as naval ships, ensuring optimal performance. Moreover, the signing of the military contract was graced by Rajesh Kumar Singh, Defence Secretary. Notably, the US implemented a 50 per cent punitive US tariffs on Indian goods entering its market, along with a 25 per cent tariff associated with India’s Russian oil exports.

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