As India Tries Not to Upset US or Russia, DefExpo Participants Express Anger at Sudden Deferral

One foreign exhibitor said since these events operate on a tight global timetable, planned years in advance, no deviations or ‘postponements’ were possible.

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New Delhi: The Indian embassy in Cambodia – obviously unaware that DefExpo 2022 had been summarily postponed last week – exuberantly “invited” locals to the biennial land, naval and homeland security systems exhibition at Gandhinagar in Gujarat.

In a tweet at around 10 am, local time, on Wednesday, India’s mission in Phnom Penh called upon ‘interested participants from Cambodia’ to register themselves through the official website of Mazagon Dock Shipbuilders (MDL) in Mumbai in order to attend the four-day Expo – which had been called off on March 4.

However, an hour later the tweet was deleted, after netizens informed the embassy of the Expo’s deferral by the Ministry of Defence (MoD) six days before its March 10 inauguration by Prime Minister Narendra Modi, in a move that has globally dented India’s credibility as a reliable defence equipment customer and vendor.

A screenshot of the deleted tweet. Photo: By arrangement

Obviously, the Indian embassy in Cambodia had missed the MoD’s brusque announcement on the Press Information Bureau (PIB)’s website, stating that the DexExpo from March 10-14 stood postponed ‘due to logistic problems being experienced by participants’. New dates for the exhibition, the PIB added, would be communicated in ‘due course’, as participants privately fulminated over the MoD’s arbitrariness in adjourning the Expo at a juncture when India’s military desperately needed to diversify its predominantly Russian arsenal.

No explanations were forthcoming for some 1,028 harried exhibitors, which included 121 materiel makers from 70 countries, alongside over 900 local companies, all of whom had not only had paid big money to participate in the Expo but also ferried elaborate displays, and in some cases even platforms, to the Mahatma Mandir Convention and Exhibition Centre (MMCEC) in Gandhinagar.

But the postponement was not the only body blow to exhibitors.

It was followed a day later by a coldblooded eviction notice to them all by the Defence Exhibition Organisation (DEO), responsible for managing the show. In essence, they were told to clear out their stalls within 24 hours. The brusque notification called on all exhibitors to take their ‘exhibits and belongings from all venues by March 6 forenoon positively’ given the uncertain ‘availability of security arrangements for limited periods at the venues’.

“This notice only added insult to injury,” said an overseas participant. He said requests for extending the deadline to remove massive display mock-ups and even heavier platforms, were straightaway declined by DEO personnel, who had even threatened to levy demurrage on participants if their order was infringed.

In at least one instance, these officials are believed to have told an exhibitor to locally hire a warehouse to store his display equipment prior to shipping it out. But their immediate message to this vendor was firm: he needed to get everything out of the MMCEC premises within the constricted timeframe.

Officials from DOE were unavailable for comment, while personnel from Delhi-based R E Rogers, tasked with providing logistics and freight-forwarding and transportation services to Expo exhibitors, declined to speak on the matter.

Many participants categorically stated that they had not faced any ‘logistic problems’ at the Expo, and were in the final stages of erecting their stalls in readiness for the show, when they were ‘sideswiped’ with the ‘bombshell’ postponement announcement. Some agitated foreign participants – that included Airbus, Boeing, Lockheed Martin and Northrop Grumman from the US, Thales from France and Israel Aerospace Industries and Rafael Advanced Defence Systems, also from Israel, amongst others – expressed anger, frustration and weariness in equal measure with the MoD over the Expo’s adjournment.

“All our efforts and money stand wasted,” said one foreign exhibitor. The MoD, he railed, had ‘misbehaved’ with the participants by taking them entirely for granted and calling off the Expo at the last minute. One other equally incensed participant declared that the Expo deferment would ‘severely dent’ India’s image in the global arms bazaar, as the MoD had failed to realise that all such exhibitions operated on a tight global timetable and were planned years in advance. No deviations or ‘postponements’ were possible, he declared, declining like the previous exhibitor to be named, as both were fearful of a ‘vindictive’ riposte from the MoD.

Foreign delegations comprising around 50 defence ministers and service chiefs too had announced their intent to participate in the show and in numerous seminars and discussions scheduled over four days. Thousands of participants had also booked rooms in around 20 five-star hotels in Ahmedabad and Gandhinagar, some for over Rs 50,000 per night, registering a sixfold hike over the normal tariff in the twin cities. One exhibitor even told The Wire that his company had lost its advance payment of Rs 12 lakh for the five rooms he had booked in Ahmedabad, as this amount had been deemed nonrefundable.

Local vendors question MoD’s seriousness

Several local vendors from Ashok Leyland, Tata Advanced Systems Limited, Mahendra Defence Systems, Adani Defence and other defence public sector undertakings, on the other hand, accepted the Expo postponement, albeit despairingly. Though their reactions were muted, it was evident that many questioned the MoD’s “seriousness” over its Atma Nirbharta initiative, aimed at boosting indigenous materiel production to reduce dependency on defence equipment imports.

“It (deferment) is definitely a setback, as Indian companies were unable to interact with foreign original equipment manufacturers (OEMs) to catch up with the latest technologies available,” said one senior official from a leading local company. It was an expensive waste, he admitted.

Senior industry and defence officials claimed that the Expo’s deferment had followed ‘pressure’ on New Delhi during the March 3 Quadrilateral Security Dialogue or Quad meeting between Prime Minister Narendra Modi and his Australian, Japanese and US counterparts. They claimed that in this virtual four-member conclave, the US had reportedly called upon India not to facilitate the display of Russian armaments at its Expo a week hence.

To further reinforce its sanctions on Russia’s entire defence industry, amongst numerous other sectors, for invading Ukraine, the US is also believed to have indicated in the Quad interaction its intent to withdraw from DefExpo, if India permitted Russian military enterprises to participate. Several participating European countries too were separately believed to have echoed similar intent, all of which eventually coalesced, leading to the shows’ stoppage.

Furthermore, some Russian participants claimed to be facing financial problems with their credit cards and other international payment platforms due to the US-led sanctions on their country’s financial institutions. Besides, travelling to India from Moscow for many Russian armament company executives too was jeopardised as Aeroflot, their country’s flagship airline, had suspended most of its international flights – including to India – after sanctions kicked in.

Russian defence companies were the second largest foreign exhibitors at DefExpo after the US and included Almaz-Antey Air and Space Defence Corporation, Rosoboronexport JSC, United Engine Corporation, United Shipbuilding Corporation and High Precision Weapons JSC, amongst others; all stand sanctioned by the US, the European Union and other countries around the world like Australia and Japan.

Surprisingly, even defence secretary Ajay Kumar was unaware of the Expo’s postponement. And, much like the Indian embassy in Cambodia, he also tweeted – on the morning that the ‘postponement’ was announced – that ‘Great opportunities (existed) for VCs (venture capitalists at Defexpo) to invest in best technological brains of India. Clearly, he was unaware that the Prime Minister’s Office had decided to call it off following the Quad summit the day before.

A scene from DefExpo 2020 in Lucknow. Photo: Reuters/File

Campaign to refund money

In the meantime, the Expo’s postponement has triggered a campaign for the MoD to refund the exhibitors’ money. “The refunds are being delayed and we are told that around 30% will be deducted for no fault of the companies who have spent so much to get (their) equipment on site,” tweeted Sanjiv Kumar on Wednesday. Please do not allow demeaning of India’s reputation, he pleaded.

Industry officials confirmed that postponing the Expo provided the MoD a ‘loophole’ to not refund exhibitors for their large advances to ensure Expo participation. For, in the event of the Expo having been officially cancelled, exhibitors would be eligible to be reimbursed just 75% of their overall entry fee, as DEO rules stipulate that 25% of the total payment would remain with it for ‘compensation of costs’. Senior officials indicated that presently the MoD had no intention of making any refunds and was simply waiting for the ruckus over the postponement to subside.

Since its initiation in 1996, India’s DexExpo – of which the postponed one was the 12th edition – was held every two years in Delhi till 2014, after which it became peripatetic, taking place in the incumbent defence minister’s home state. Much to the chagrin of participants and even India’s armed forces personnel, it took place in Goa in 2014 under defence minister Manohar Parrikar, in Chennai in 2016 under his successor Nirmala Sitharaman, and thereafter in Lucknow when Rajnath Singh ascended to that post. Industry officials said Gujarat was the designated venue this year as it was not only the PM’s home state but also the state where elections are scheduled for later in the year.

In conclusion, many exhibitors were primarily incensed over the ‘unimaginative and laughable’ alibi of logistic problems cited by the MoD for the Expo’s postponement. “It would have been far more graceful, acceptable and realistic if the Ukraine conflict had been proffered as the reason for this deferment,” said an executive from a European firm. The feeble explanation given, he added, smacked of bureaucratic self-righteousness and infallibility, postures the armed forces can well do without.