New Delhi went ahead and inked a $5-billion deal to purchase the S-400 Triumf air defence missile system from Moscow on Friday.

The U.S. presidential waiver on weapons deal with sanctions-hit Russia is intended to “wean” countries like India off Russian equipment, the White House has said, as New Delhi went ahead and inked a $5-billion deal to purchase the S-400 Triumf air defence missile system from Moscow.

The mega deal was sealed in New Delhi on Friday during the visit of Russian President Vladimir Putin for the annual summit with Prime Minister Narendra Modi.

In a guarded reaction, the U.S. said on Friday that its intent to slap sanctions against Russia was not aimed at causing damage to the military capabilities of its “allies or partners”, shortly after India concluded the deal.

The S-400 missile defence system would give India’s defence a cutting-edge security against any missile attack by its enemies.

“The [CAATSA presidential] waiver is narrow, intended to wean countries off Russian equipment and allow for things such as spare parts for previously-purchased equipment,” a White House National Security Council Spokesperson told PTI hours after the conclusion of the S-400 contract.

The deal was concluded during the visit of Russian President Vladimir Putin for the annual summit with Prime Minister Narendra Modi.

Russian President Vladimir Putin with Prime Minister Narendra Modi in New Delhi on October 5, 2018. | Photo Credit: Sandeep Saxena

President of U.S.-India Strategic and Partnership Forum Mukesh Aghi said, “India lives in a very turbulent and nuclear-powered region. S-400 provides that assurance and is compatible with its current platform. Friends understand that these discussions with Russia started several years ago, hence I do not believe U.S. will impose sanction[s] on India.”

Sanctions warranted by the Countering America’s Adversaries Through Sanctions Act or CAATSA, which comes into play in the event of a major purchase like the S-400 missile defence system, may be bypassed by a presidential waiver. Ahead of the deal, the U.S. had urged India not to purchase S-400. It had reiterated on Friday:

“The Administration has indicated that a focus area for the implementation of CAATSA Section 231 is new or qualitative upgrades in capability — including the S-400 air and missile defence system,” the White House NSC Spokesperson said.

Sanctions on China

Last month, the U.S. had imposed sanctions on China for the purchase of S-400 from Russia.

“Our recent action to sanction a Chinese government entity for an S-400 delivery underscores the seriousness of our resolve on this issue. The waiver authority is not country-specific. There are strict criteria for considering a waiver,” said the spokesperson.

The State Department, which is tasked with reviewing the deal and initiated the process of sanctions or waiver under CAATSAA, and then recommend to the President, did not respond to the question on the time frame and the process.

However, an industry source said the law is ambiguous about “when a waiver is necessary so this can be avoided for years”.

The National Defence Authorisation ACT (NDDA) 2019 gives President the power to waive the CAATSA sanctions if it is national security interest. It also lists out several other options for presidential waiver, prominent among which is that the purchase country — India in this case — is taking or will take steps to reduce its inventory of major defence equipment and advanced conventional weapons produced by the defence sector of the Russian Federation as a share of its total inventory of major defence equipment and advanced conventional weapons over a specified period.

‘Major Defence Partner’

The top arms purchaser over the last decade and more, India has gradually reduced its dependence on Russian arms. It now stands at about 60%, which is much lower than it was a decade ago. The U.S. has been a major beneficiary of this move.

As part of its diversification plan, India has increased its purchase of arms from the U.S. from about zero to more than $18 billion. India is in the process of purchasing arms and equipment worth billions of dollars from the U.S. in the coming years including armed and unarmed drones and fighter jets.

A presidential waiver can also be given if a country — such as India, in this case — is cooperating with the U.S. government on other security matters critical to its strategic interests. Experts believe that is exactly the case and one of the main reasons for the U.S. designating India as a ‘Major Defence Partner’.

“I don’t like to make predictions in today’s Washington but sanctioning India, and surrendering the Indian defence market to Russia, would have exactly the opposite of the intended effect of CAATSA. No American interest group benefits from sanctioning India,” Benjamin Schwartz from U.S. India Business Council said.

He has previously served as the director for India in the U.S. office of the secretary of defence.

Aparna Pande, from the Hudson Institute think-tank, said, “I believe what is more likely is that even though India will sign the S-400 deal, it will delay payment, etc., so that the sanctions don’t come into effect.”

“This way India maintains its strategic autonomy and historical ties with Russia and yet ensures its strategic relationship with the U.S. is not impacted either,” Ms. Pande said.

According to Rick Rossow, from the Centre for Strategic and International Studies think tank, “Congress widened the waiver criteria with India in mind, and the fact we had a robust ‘2+2 Dialogue’ in Delhi a month back shows that the administration believes in the momentum.”

The Russian Embassy in the U.S. tweeted that the delivery of S-400 would begin in October 2020.