South Asia Security Monitor: No. 353

INDIA BOLSTERS DEFENSE
Under the tutelage of India's new Primer Minister, Narendra Modi, and his Defense Minister, Arun Jaitley, India’s defense acquisitions council (DAC) is approving funding for a long list of stalled defense projects, throwing over $13 billion towards anti-tank guided missiles and stealth submarines, among others. The DAC decision to purchase Israeli-made Spike anti-tank missiles and launchers for $525 million was a surprise as industry sources expected the U.S. to win that tender with its offer of Javelin missiles. The bulk of the money will go toward the six stealth submarines, designed to upgrade India's aging fleet of a dozen diesel-electric submarines. Initial approval for the six Air Independent Propulsion subs was first given in 2007 but has languished for years in India's bloated defense bureaucracy. Indian shipyards, which are currently building several indigenous nuclear submarines (the first of which is has been undergoing sea trials in recent years) and six French-designed Scorpene conventional submarines, will be given an opportunity to bid on the tender. (The Times of India, October 26, 2014;Reuters, October 25, 2014)

VIETNAMESE PM NGUYEN TAN DUNG VISITS INDIA
Vietnamese Prime Minister Nguyen Tan Dung made a two-day visit to India to hold strategic discussions with Indian Prime Minister Narendra Modi. Most notably, both parties agreed on modernizing the Vietnamese military and raising Indian investment in Vietnam’s energy sector. Mr. Modi extended Vietnam a $100-million line of credit that will be used to purchase four Indian Offshore Patrol Vessels (OPVs) at a time Vietnam embroiled in maritime territorial disputes with China. The two sides also affirmed that Vietnam had made an offer to the Indian energy company OVL to expand energy exploration projects in Vietnamese waters. Beijing has already objected to OVL's participation in energy projects off Vietnam's coast in waters claimed by China. (Reuters, October 28, 2014)

SRI LANKA BANS FOREIGNERS FROM BUYING LAND
Sri Lanka passed legislation banning land purchases by foreigners in hopes of reducing tax evasion. Individuals, as well as companies over 50% foreign-owned, will no longer be allowed to own Sri Lankan property. However, foreigners will be able to lease Sri Lankan property for up to 99 years, subject to a tax of 15%. (Reuters, October 22, 2014)

XI VISIT TO PAKISTAN POSTPONED
For the second time this year, Chinese President Xi Jinping has called off a trip to Pakistan. Pakistani Prime Minister Nawaz Sharif said the visit was postponed due to the “immature” politics of Imran Khan, the opposition politician who has paralyzed Pakistan with massive, street-wide demonstrations at several points this year. Currently, Khan’s supporters are holding sit-ins in the capital of Islamabad, scaring away not only foreign leaders but international investors. Earlier this year, Xi was supposed to visit Islamabad after his inaugural visit to India. That trip too was called off for security reasons. (The Express Tribune, October 27, 2014)a