THIS IS IR 6 844 0038 79

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP06T01849R000100040030-8
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 5
• Document Creation Date: December 22, 2016
• Document Release Date: April 17, 2012
• Sequence Number: 30
• Publication Date: March 26, 1979
• Content Type: CABLE

Declassified in Part - Sanitized Copy Approved for Release 2012/06/18: CIA-RDP06T01849R000100040030-8_ 1
10/22/ >Y!~ TIP SECTION 40
FRP: . . .4. .6. .A
PAGE 001-006
TOR: 261308Z MAR.79
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FM TRIAGYMC WASHINGTON DC
TO RUEAMCC/CMC CC WASHINGTON DC
RUEAHOA/CSAF WASHINGTON DC
RUENAAA/CNO WASHINGTON DC
RUEADWD/CSA WASHINGTON DC
RUEAIIF/C I A
RUEHC/SECSTATE WASHINGTON DC
RUETIAH/NSA WASH DC
0 261142Z MAR 79
FM
TO.RUEKJCS/DIA WASHINGTON DC IMMEDIATE
INFO RUHQHQA/COMIPAC HONOLULU HI
RHMIAAA/13TH AF CLARK AFB PI
RUSBOD/I
RUEHMY/
RUDONHA
RUEHC/DEPARTMENT OF STATE WASHINGTON DC IMMEDIATE
BT
S E C R E T/NOFRON/WNINTEL
SECTION I Of-t Z
SUBJ: THIS I3 25X1
1. (U) COUNTRY! N R (UR)
2. (U) REPORT NUMBER! 25X1
3, (S/NF) SUBJ: SOVIETS OFFER MIG-23 TO INDIA DURING KOSYGIN VISIT
4. (U) OMITTED
S. (U) DATE OF INFO: 790324.
6, (U) DATE OF REPORT: 790326
7, (U) DATE & PLACE OF ACQUISITION! 790324 NEW DELHI INDIA
8. (U) REFERENCES: ZDI3IN690. ZOT31NO30
9. (U) ASSESSMENT: SOURCE- B: INFO. 2
10. (U) ORIGINATOR: 25X1
11. (U) REQUEST EVAL: YES; : NO
12. (U) PREPARING OFFICER: 25X1
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13. (U) APPROVING AUTH:
14. (S/NF) SOURCES VICE CHIEF OF
AIR STAFF. INDIAN AIR FORCE.
15. (U) DIRC ? NO; SPECIAL INSTRUCTIONS: CAVEATS TO PROTECT METHOD
OF COLLECTION.
16. (S/NF/WNINTEL/ORCON) SUMMARY: RO WAS ABLE TO ELICIT FROM THE
THE INDIAN GOVERNMENT AND INDIAN AIR FORCE IS DEEPLY
ENGAGED IN EVALUATING THIS PROPOSAL. IMPLICATIONS FOR THE EROSION OF
THE JAGUAR STRIKE FIGHTER CONTRACT AND A SHIFT IN AIRCRAFT PRO-
DUCTION PLANS IN INDIA ARE IMPLICIT IN THIS EVALUATION.
17.21. (U) OMITTED.
22. (S/NF/WNINTEL/URCON) DETAILS.
A. (S/NF/ORCON WINTEL) THAT THE
SOVIETS HAD OFFERED THE MIG?23 TO INDIA DURING KOSYGINS VISIT
TO INDIA. THE OFFER WAS ENDED BY A MEMBER OF THE DELEGATION
(DIRECTOR OF THE CHIEF DEPARTMENT
THE GENERAL STAFF OF THE ARMED FORCES OF THE USSR). THE
INDIAN GOVERNMENT HAS REOPENED THE.ENTIRE DECISION TO PURCHASE
AND PRODUCE THE JAGUAR STRIKE FIGHTER. THE CABINET COMMITTEE
ON POLITICAL AFFAIRS (CCPA) WILL EVALUATE-THE NEW SOVIET
PROPOSAL. THE SOVIET PROPOSAL WAS APPARENTLY BASED UPON FOUR
POINTS: FIRST. THAT THE COST OF JAGUAR WAS EXORBITANT WITH A 16 PER
CENT PER YEAR INFLATION FACTOR BUILT INTO THE PURCHASE AND
PRODUCTION COSTS. SOURCE STATES THAT BY 1983 WHEN THE FIRST INDIAN
BUILT JAGUAR WOULD BE COMPLETED THE COST WOULD BE AT LEAST EIGHTY
PERCENT ABOVE THE 1979 PRICE OF 8 CRORE (EACH CRORE IS EQUAL
TO TEN MILLION) RUPEES. SOURCE STATES THAT "INSTEAD OF THE
AIRCRAFT BEING EIGHT CRORE THE FIRST ONE COSTS YOU SIXTEEN CRORE
AND BY THE TIME THE PRODUCTION RUN IS COMPLETE.THE AIRCRAFT ARE
COSTING EIGHTEEN CRORE." SECOND POINT MADE BY THE SOURCE WAS
THE GREAT "HURT" WHICH THE USSR EXPRESSED AT THE PURCHASE OF A
WESTERN AIRCRAFT. THRID. THE SOVIETS SEEMED TO HAVE STRESSED RAPID.
FLYAWAY. OFF-THE-SHELF DELIVERY OF THE MIG??3 TO INDIA.
LAST. THE PROSPECT OF VERY FAVORABLE FINANCIAL TERMS
SEEMS TO APPEAL TO INDIAN DEFENSE DECISION MAKERS. IN
THIS SCENARIO A RUPEE PURCHASE WOULD ALLOW CONSERVATION
OF FOREIGN EXCHANGE FOR OTHER PROJECTS. SOVIET GRANTS. CREDITS.
CONCESSIONARY SELLING PRICE. OR A COMBINATION OF THESE TERMS.
OF TRADE COULD BE MOLDED BY THE USSR INTO AN ATTRACTIVE
FINANCIAL PACKAGE. INDIAN POLITICAL LEADERS WOULD FIND IT
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... .. .. .. .. .. .. .. ... . . . ..... .. ?- ? - ? - mm -- - - . . .......
DIFFICULT TO JUSTIFY A REJECTION OF THE SOVIET OFFER. ASSUMING THAT
THE INDIAN AIR FORCE FOUND THE AIRCRAFT "ACCEPTABLE."
B. (S/NOFRON/ORCON/WNINTEL) THE INDIAN AIR FORCE. ACCORDING
TO THE SOURCE. SEEMS TO BE COMING UNDER INCREASING PRESSURE
FROM THE MINISTRY OF FINANCE TO PARE DOWN ITS JAGUAR ACQUISITION.
THE INDIAN AIR FORCE HAD OPERATED UNDER THE ASSUMPTION IT WAS TO
'REPLACE' ITS OBSOLETE CANBERRA MEDIUM BOMBERS AND
HUNTER STRIKE AIRCRAFT. REPLACEMENT OF THESE 126 AIRCRAFT AS
WELL AS THE PURCHASE/MANUFACTURE OF AN ADDITIONAL 30 PERCENT
FOR TRAINING. SPARES. AND REPLACEMENTS FOR THOSE AIRCRAFT LOST
THROUGH ACCIDENTS DURING THE TEN YEAR COURSE OF THE JAGUAR
PRODUCTION RUN WOULD HAVE RESULTED IN THE ULTIMATE PURCHASE
AND/OR MANUFACTURE OF APPROXIMATELY 170 JAGUAR STRIKE AIRCRAFT.
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FM TRIAGYMC WASHINGTON DC
TO INFO RUEAMCC/CMG CC WASHINGTON DC
RUEAHQA/CSAF WASHINGTON DC
RUENAAA/CNO WASHINGTON DC
RUEADWD/CSA WASHINGTON DC
RUEAIIF/C I A
RUEHC/SECSTATE WASHINGTON DC
RUETIAH/NSA WASH DC
0 261142Z MAR 79
FM
TO.RUEKJCS/DIA WASHINGTON DC IMMEDIATE
INFO RUHQHQA/COMIPAC HONOLULU HI
RHMIAAA/13TH AF CLARK AFB PI
RUSBQD/
RUEHMY/
RUDONBA
RUEHC/DEPARTMENT OF STATE WASHINGTON DC IMMEDIATE
BT
S E C R E T/NOFORN/WNINTEL
SECTION 2 OF 2
NOW THE INDIAN AIR FORCE IS BEING ASKED TO HOLD ACQUISITION TO
"FIVE JAGUAR SQUADRONS" CLEARED BY THE CABINET COMMITTEE ON
POLITICAL AFFAIRS. THE FIVE SQUADRON JAGUAR PROGRAM WOULD
ULTIMATELY AMOUNT TO APPROXIMATELY 110 AIRCRAFT. (FIVE SQUADRONS OF
SIXTEEN AIRCRAFT EACH PLUS SPARES AND REPLACEMENTS FOR ATTRITION).
THE FIVE JAGUAR SQUADRONS WOULD REPLACE SEVEN ACTIVE-SQUADRONS.
OF CANBERRAS AND HUNTERS THIS SIZE ACQUISITION OF JAGUAR STRIKE
AIRCRAFT WOULD UPHOLD EARLIER STATEMENTS
THAT THE JAGUAR PURCHASE WOULD MODERNIZE THE'INDIAN AIR FORCE
WHILE REDUCING THE NUMBER OF STRIKE CAPABLE SQUADRONS. (SEE NEW
DELHI SECRET 9435 ON 161230Z JUN 78 ENTITLED INDIAN AIRR FORCE
LEVELS).
...C. (S/NF/ORCON/WNINTEL) MANIPULATION OF THE TERMS OF
REFERENCE UPON WHICH THE JAGUAR NEGOTIATIONS HAVE.BEEN BASED
("REPLACEMENT OF SQUADRONS" VERSUS "REPLACEMENT OF OBSOLETE
AIRCRAFT") AT THIS LATE DATE MAY INDICATE INFIGHTING BETWEEN
SECRET
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S-S
79 220845rt' PAGE .0.O
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TOR: 26132PZ MAR
THE MINISTRY OF FINANC ERI IAND THE MINISTRY OF
DEFENSE UNDER THE PROPOSAL TO PURCHASE THE MIG-23
FOR THE INDIAN AIR FORCE WOULD TEMPT THE INDIAN AIR FORCE TO
SUPPORT THE MODIFICATION OF THE REDUCED JAGUAR PROGRAM. ON
THE ONE HAND THE IAF WOULD SEE ITSELF REDUCED TO THE FIVE NEW
SQUADRONS OF JAGUARS WHEREAS ON THE OTHER HAND THE IAF WOULD
RECEIVE THE FIVE JAGUAR SQUADRONS AND TWO MIG-23_SQUADRONS.
D. (S/NF) THE USSR MAY SEE TWO POTENTIAL BENEFITS IN PUSHING
THE MIG-23 DEAL AT THIS TIME. FIRST, THE RETENTION OF INDIA AS A
CLIENT FOR SOVIET AIRCRAFT HAS BEEN REPORTED EARLIER. SECOND. DIS-
RUPTION OF THE BRITISH AEROSPACE CONTRACT.-PROCEEDINGS IN INDIA.WMICH
ARE ALREADY VERY TURBULENT MAY SIGNAL TO THE, UK THE SOVIET DIS-
PLEASURE AT BRITISH ARMS DEALINGS WITH CHINA. IN THIS WAY THE USSR
SUSTAINS A LONG STANDING DEFENSE SUPPLY RELATIONSHIP WHILE DAMAGING
BRITISH INTERESTS..
E. (S/NF/ORCON/WNINTEL) SOURCE STATES THAT AT THIS TIME THE
MIG-23 OFFER IS NEBULOUS. NO PRICE INFORMATION HAS BEEN GIVEN TO
THE INDIANS. THE IAF WILL BE SENDING AN EVALUATION TEAM TO FLY THE
MIG-23 AND'MUST MAKE A THOROUGH EVALUATION.
SOURCE STATES THAT THE OUTCOME MAY CAUSE A REEVALUATION OF THE WHOLE
CONCEPT OF CO-PRODUCTION.OF ADVANCED AIRCRAFT IN INDIA. R.O.
BELIEVES THAT A MIG-23 PURCHASE WOULD SUBSTITUTE FOR TWO SQUADRONS
OF MIG-21'S TO BE BUILT IN INDIA. INDIA COULD TERMINATE THE MIG-21
ASSEMBLY FORTY AIRCRAFT SOONER THAN PRESENTLY PLANNED. THE MIG-23
AIRCRAFT WOULD THUS FILL OUT THE PLANNED FORTY-FIVE SQUADRONS WHICH
THE IAF INTENDS TO RETAIN.
ORIGINATORS COMMENTS! (S/NF) THE EVALUATION OF THE MIG-23 AND THE
MODIFICATION OF THE JAGUAR PROGRAM AS WELL AS CHANGES IN OTHER
AIRCRAFT PRODUCTION PROGRAMS ARE ALL EVENTS UNFOLDING AT THE
PRESENT TIME. IT IS TOO EARLY TO SPECULATE UPON THE EVENTUAL OUTCOME
OF THESE DECISIONS. AT THIS POINT IT SEEMS BEST TO SAY THAT AFTER
EIGHT YEARS, THE FINAL DECISION ON A STRIKE AIRCRAFT FOR THE INDIAN
#IR FORCE IS NOT FULLY DETERMINED. REFERENCE AND
FOR BACKGROUND.
SECRET
25X1
25X1
') tiY'I
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Declassified in Part - Sanitized Copy Approved for Release 2012/06/18: CIA-RDP06T01849R000100040030-8