The Latest Episode Is Testament to How Wars Promote Sales for the Military Industrial Complex

Within days of the beginning of hostilities between India and Pakistan, arms suppliers around the world started evaluating the efficacy of alternative weapons platforms.

First off the ground was an Anglo-American news agency, Reuters, that reported the downing of the French fighter jet Rafale which is now part of the arsenal of the Indian Air Force. The shares of Dassault Aviation, the producer of Rafale fighter jets plummeted 3.3 percentage points, with the share value going down from $373.8 to $362.05. At the same time the shares of the Chinese company Chengdu Aircraft Corporation, producer of the J-10C and J-17 fighter jets that the Pakistan Air Force deployed went up, recording a 30% rise. The China-made jets allegedly downed the France-made one.

Not to be left behind in this game of arms bazaar salesmanship, friends of Russia let it be known that India’s success in warding off air attacks from Pakistan was on account of the efficient and successful deployment of Russia’s S-400 missiles. The very missiles that the United States had threatened to sanction and warned India against buying. The Pakistanis also demonstrated the efficacy of China’s PL-15 missiles deployed against Indian aircraft.

Even as hostilities proceeded apace, media reported arrival of Israeli weapons in India and of Turkish weapons in Pakistan. Not to be left behind, American analysts have started reminding India that it would be better off buying US fighter jets. Both president Donald Trump and vice-president J.D. Vance explicitly canvassed for Indian purchase of F-35 fighter jets. The Indian Air Force requires to purchase a large number of jets and the competition has been on between the US, France, Russia and Sweden.

Given the role played by the air force in recent conflicts with Pakistan an Indian decision on what to buy would be an important game changer for major suppliers.

It was way back in 1961 that the then US president Dwight Eisenhower warned the American people of the growing clout of what he termed as the ‘military industrial complex’. “In the councils of government,” warned Eisenhower, “we must guard against the acquisition of unwarranted influence, whether sought or unsought, by the military industrial complex. The potential for the disastrous rise of misplaced power exists and will persist.”  This warning did not prevent the global expansion and influence of the military industrial complex. Between 1961 and 2025, scores of wars have been fought. Yet, the main arms suppliers for all sides in all wars have been American, European and Russian firms. China entered this business only recently.

New wars for new technology

Any war is viewed by arms suppliers as an opportunity to test technology in real time. Hence, when new technologies get developed new wars come in handy. Peace time is when technologies are developed, investments made. War time is when technologies are tested, profits are made. In the on-going engagement between India and Pakistan, it is not the wares of established western suppliers that are getting showcased as much as the new wares of the new salesman, China. China was constrained in displaying its wares in the Ukraine war, for fear of US sanctions, but has now been left free to do so in the India-Pakistan war.

The unfortunate reality about an India-Pakistan conflict is that both countries are essentially dependent on imported arms equipment. While both have tried to develop domestic manufacturing capabilities and capacities they remain dependent on global arms manufacturers for reliable ammunition and equipment in real time conflict situations. This is why global arms manufacturers court both countries. Consider the fact that both the US and Russia are happy to sell equipment to both India and Pakistan. China sells only to Pakistan while Israel sells only to India. The French sell to anyone who is willing to buy.

I was told this entertaining and educative tale by the late Dr Mahbub ul Haq, distinguished Pakistani economist, international diplomat and once a finance minister of Pakistan. Haq was my host during my only visit to Pakistan in 1997 when he invited me for a conference at his Human Development Institute in Islamabad. During his tenure as finance minister in a Benazir Bhutto government in the late 1980s, Haq was asked by her how much money he could spare to buy a few fighter jets from France. Haq wondered why such an order had to be placed so urgently. Prime minister Bhutto was candid in her reply. “I want to visit Paris,” she told Haq. “The French will offer a state visit if we buy some jets.”

Something like that seems to have happened with prime minister Narendra Modi for his visit to the United States this March. India offered increased defence purchases from the US as a sweetener to tough talking president Trump. The US has aggressively pursued the Indian defence market ever since it signed a defence cooperation agreement with it in 2005 and a new framework for defence relationship in 2015. Over the past two decades US share in India’s defence imports has increased from just around 1.0% in 2006-2010 to over 10.0% in 2020-2024. Russia’s share in India’s defence imports went down from 75% to 36% in the same period.

A similar switch has happened in Pakistan. France saw its share of the Pakistan market fall from 36% to virtually zero in this period, while China’s share of the Pakistan defence imports market increased from 36% to 81%. Israel is India’s other important source, while Turkey is for Pakistan. So while the two South Asian neighbours fight and kill each other, the Americans, French, Russian Chinese, Israeli and Turkish arms manufacturers are making money selling arms.

Over the past decade, India has tried to indigenise defence manufacturing with the policy of ‘atmanirbharta' or self reliance in defence manufacturing. This has certainly helped reduce some dependence on imports, especially in the middle of hostilities. India is now also an exporter, exporting missiles and small arms to countries like Egypt, Philippines, Vietnam, Armenia and Poland among others. One area in which India has acquired considerable domestic capability is in drone manufacturing. It was in 2017-2018 that India made a concerted attempt at promoting the domestic manufacturing of drones. This has come in handy today with Indian drones playing havoc across the border.

Sanjaya Baru is founder-trustee, Centre for Air Power Studies and Distinguished Fellow, United Services Institution of India.

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