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Reuters

US sanctions on Russian military exports have put the brakes on a US$6 billion deal between Moscow and India, and threatens to derail the arms purchases of other US allies around Asia, experts say.
Under a law that US President Donald Trump signed in August, any country trading with Russia’s defence and intelligence sectors will face sanctions.
The law is designed to punish Russian President Vladimir Putin for the 2014 annexation of Crimea from Ukraine, involvement in the Syrian civil war and meddling in the 2016 US presidential election.
But American allies who buy weapons and equipment from Russia, the world’s second-largest arms exporter, could suffer as well.
The highest-profile example is India, which wants to buy five S-400 long-range surface-to-air missile systems that the country’s military sees as a game changer. The systems are touted as being able to counter the ballistic missiles and stealth aircraft that China is developing, while overwhelming the capabilities of Pakistan, India’s other main adversary.
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The deal, which Putin and Indian Prime Minister Narendra Modi struck as part of an intergovernment agreement in 2016, has run headlong into the US sanctions law, two officials in Delhi said.
Indonesia and Vietnam also buy weapons from Russia while being regional partners of the United States. Jakarta closed a US$1.14 billion pact for Sukhoi fighters recently, while Vietnam is seeking more jet fighter-bombers from Russia.
And with both Almaz-Antey Air and Space Defence Corporation, which makes the S-400, and Rosoboronexport, which negotiates Russian export deals, listed as under sanction, those deals have become trickier.

“The optics of a major arms purchase from Russia looks quite ‘iffy’ from the point of view of Western capitals, especially at a time when Russia-West relations are at an all-time low and India seeks strategic convergence with the West, including with the US” said Abhijnan Rej, a defence strategy expert at Observer Research Foundation, a New Delhi think tank.
The US-led air strikes this month against facilities of the Syrian government, an ally of Russia, has further aggravated tensions between the superpowers.
A Russian source close to the Indian S-400 deal said “a lot will depend on the confidence and sanity of our Indian partners”.

The effects of the US sanctions law could be more sweeping than intended, said Cara Abercrombie, a visiting scholar at the Carnegie Endowment for International Peace.
Vietnam, whose air force flies Russian-made Su-30 fighters and uses the S-300 air defence system, wants to continue modernising its inventory.
Vietnamese military scholar Carl Thayer said he believed Moscow was still pushing Hanoi to invest in state-of-the-art S-400 missile defences as part of its long-term military plans.
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“I think it is clear that Russia is still pressing Vietnam for big deals,” Thayer said, noting that the two countries already have had reciprocal visits by defence ministers this year. But with the United States working hard to promote sales of American military hardware, and sanctions against Russia’s exporting agencies, Vietnam’s plans could prove too costly.
Indonesia, meanwhile, said the delivery of the first couple of Sukhoi Su-35 jets out of a total of 11 is on track for this year. Officials said that so far they did not anticipate any changes to the deal with the Russians.
Indonesian defence officials declined to describe what, if anything, they might do to tackle the fallout of the sanctions imposed on Russian arms sales.

Indian Foreign Secretary Vijay Gokhale and Defence Secretary Sanjay Mitra held discussions with US officials in Washington last month to try to find a solution, a second Indian official said.
The issue is crucial to the Indian military, because without Russian parts, supplies and maintenance help, “our ships won’t sail, our planes won’t fly,” the official said. “We can hardly be the regional security provider that America wants us to be at this rate.”
One way to avoid secondary sanctions would be if the US determines that India is reducing its dependence on Russian arms, said Atman Trivedi, managing director of Hills & Company, a Washington-based firm that advises on international trade and investment.
Russian hardware represented 62 per cent of the country’s total weapons imports during the past five years, compared with 79 per cent in 2008-2012, the Stockholm Peace Research Institute said in a report last month.

The US administration could also declare that imposing sanctions on India, a major defence partner, would hurt US national security interests. That would allow a waiver permitting India to do business with Russia.
The United States has emerged as India’s No. 2 weapons supplier, closing US$15 billion worth of deals over the last decade. Now Lockheed Martin and Boeing are leading the race to provide India with a fleet of new fighter-bombers, one of the world’s largest open tenders.
“The intent of the legislation was never to disrupt US-India defence relations, which Congress has repeatedly recognised in law as a strategic priority to the US,” said Benjamin Schwartz, aerospace and defence head at United States India Business Council.
Abercrombie said if Congress grants waivers to India, it may also need to do so for other countries such as Vietnam and Indonesia.
“The bottom line: India warrants an exemption from these secondary sanctions, as does any country with which the US is forging new and strategically important defence relations,” she said. 


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Russia

India, Indonesia and Vietnam among Asian US allies caught in crossfire of Russian arms sanctions

Russian President Vladimir Putin speaks with Indian Prime Minister Narendra Modi in St Petersburg. US sanctions on Russian military exports have put the brakes on a US$6 billion deal with India. Photo: Reuters

Russian President Vladimir Putin (R) and his Vietnamese counterpart Tran Dai Quang give a press conference following their meeting at the Kremlin in Moscow on June 29, 2017. / AFP PHOTO / POOL / Natalia KOLESNIKOVA

In this photo made from the footage taken from Russian Defense Ministry official web site on Sunday, March 11, 2018, a MiG-31 fighter jet of the Russian air force carrying the new Kinzhal hypersonic missile takes off from an air base in southern Russia. The Russian military says it has run a successful test of the Kinzhal missile, that President Vladimir Putin sited among several other new nuclear weapons that would bolster the nation's military capability. (AP Photo/ Russian Defense Ministry Press Service, File)

(FILES) This file photo taken on May 9, 2017 shows Russian S-400 Triumph medium-range and long-range surface-to-air missile systems riding through Red Square during the Victory Day military parade in Moscow. Russian President Vladimir Putin on April 3, 2018 said he had agreed with Turkish counterpart Recep Tayyip Erdogan to speed up the delivery of S-400 air defence missile systems to Ankara, a purchase that has alarmed Turkey's NATO partners. / AFP PHOTO / Natalia KOLESNIKOVA

(FILES) In this file photo taken on February 28, 2018 US President Donald Trump takes part in a meeting with bipartisan members of Congress on school and community safety in the Cabinet Room of the White House in Washington, DC. US President Donald Trump lashed out March 1, 2018 at "unfair trade" as he weighs whether to impose tariffs or quotas on cheap steel and aluminum imports that he said are decimating US producers.Trump did not single out any country in a tweet but his words came with the White House poised to announce whether it will adopt sanctions against China, Russia and other countries to combat a worldwide glut of the metals."Our Steel and Aluminum industries (and many others) have been decimated by decades of unfair trade and bad policy with countries from around the world," Trump tweeted early Thursday. / AFP PHOTO / MANDEL NGAN

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Under a law that US President Donald Trump signed in August, any country trading with Russia’s defence and intelligence sectors will face sanctions
