The S400 Deal – Will US Sanction Reliance Defense?

The fall of th S400 deal would mean a major setback for Anil Ambani’s. If the deal doesn’t get a waiver and India still goes ahead Ambani’s Rafale deal gets hit. India can easily find an alternative to S400 but that’d destroy Reliance Defense. The question is will US sanction Reliance Defense as it did with Turkey for doing business with the Russians?

S400 Deal - Will US Sanction Reliance Defense
The S400 Deal – Will US Sanction Reliance Defense

The S400 Deal – Will US Sanction Reliance Defense

Trump’s sanctions against Turkey result largely from Erdogan’s agreement to purchase the S-400 surface-to-air missile system from Russia. Interestingly, India too signed a deal worth $5.4 billion with Russia for S-400 in 2015.

Purchases from Russia attract US sanctions under the “Countering America’s Adversaries Through Sanctions Act (CAATSA)”. The US can issue waivers but only on a transaction-to-transaction basis. The US still has not given India a waiver on this deal despite requests.

Now here’s where it gets interesting (and murky).

Guess who is the main offset partner for the S-400 deal between India and Russia?

India in Cognitive Dissonance Book by GreatGameIndia

Yup – it’s Anil Ambani’s Reliance Defense.

Ambani signed a contract with Russia’s Almaz-Antey which makes S-400 potentially worth $6bn. If the US decides not to give a waiver on the S-400 deal, Reliance Defense faces sanctions too.

Now this makes it tricky because Reliance Defense is also the offset partner on Rafale. US sanctions mean Ambani can’t work with Dassault which is French (a NATO ally).

Foreign Minister Jaishankar has been lobbying hard in the US to get a waiver on S-400. A few weeks ago he said “he’s confident about his negotiation skills”. The US, however, hasn’t yet said a word on this.

The fall of the S-400 deal would mean a major setback for Anil Ambani’s Reliance Defense. If the deal doesn’t get a waiver (and India still goes ahead), Ambani’s Rafale deal gets hit. India can easily find an alternative to S-400. But that’d destroy Reliance Defense.

This is another reason why the govt. hasn’t answered questions on the Ukraine India Antonov Aircraft Scandal – the mystery Motor Sich aircraft that was intercepted by the IAF on 10th May. Motor Sich makes engines for Antonov. Anil Ambani has signed a JV with Antonov.

Motor Sich (a Ukrainian firm) shockingly operates in India out of the Russian Embassy. This despite the fact that Ukraine and Russia are at war. Motor Sich is being probed in Ukraine for terror funding to Russian separatists and for its links to Russian intelligence.

The Ukrainians had also started corruption probe lasts year in India’s deal with Antonov. They wrote a letter to the Home Ministry but the probe was buried by then Defense Minister Nirmala Sitharaman. This is why the questions on the Ukraine India Antonov Aircraft Scandal are important.

The India-Ukraine-Russia defense deal triangle has one common component – Anil Ambani’s Reliance Defense and there’s murkiness worth billions of dollars that is being covered-up.

Saket Gokhale is a former foreign correspondent. Send in your tips and submissions by filling out this form or write to us directly at the email provided.

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