On August 31, wrapping up his three-day visit to the United States, Indian Defense Minister Manohar Parrikar flew from Washington, DC to Philadelphia to visit
Boeing’s rotorcraft facility, where India’s Chinook helicopters will be built, starting next year. Parrikar was
taken to a former locomotive manufacturing plant,
which Boeing has transformed into a state-of-the-art
Chinook production line.
An empty section is draped with an Indian tricolor
and a poster that read: ‘India: Restarting the Alt(erna-te) Line in 2017.’ India’s billion-dollar contract for 15
Chinook CH-47F medium lift helicopters, signed
September 28, 2015, requires Boeing to deliver the
first chopper in 36 months and the final one before 48
months — in 2018 and 2019, respectively.
This will mark another shift in the Indian Air Force,
which has traditionally used Soviet and Russian aircraft for medium and heavy airlift. Over the last five
years, American C-130J Super Hercules and C-17
Globemaster III muscled into the fixed wing aircraft
fleet. From 2018 onwards, Russian Mi-17 helicopters
will be joined by that iconic American workhorse —
the CH-47F Chinook. Simultaneously, the IAF will
induct 22 Apache AH-64E attack helicopters, which
Boeing builds in Arizona.
Since 1962, when the Chinook first appeared on the
Vietnam battlefield, its ungainly shape and tandem
rotors have made it the world’s most recognizable
combat helicopter. Fifty-four years and numerous versions later, the US Army has declared the Chinook will
remain in service into the 2060s. By then, it would
have been in active service for a century.
The CH-47F version of the Chinook that India is buying is a high-tech marvel, a world removed from the
CH-47A of the 1960s. The CH-47F has an electronic
brain called the Digital Flight Control System that
precisely positions a hovering Chinook at the edge of a
cliff, or above the roof of a mud hut, enabling soldiers
or cargo to be discharged with unmatched precision.
Explains Leland Wight, a former Chinook pilot, who
is now a Boeing manager: “In the CH-47D, I would be
hovering, while a crewmember would look through a
vent in the floor and call out directions: ‘back, three
feet; left two feet’.
“In the CH-47F,” he adds, “the DFICS does it all. The
pilot just presses a ‘beep switch’ that shifts the helicop-
ter in precise one-foot increments — up, down, side-
ways. We hover with total precision.”
What most impressed Indian test pilots, say the
Chinook veterans working for Boeing, was its ability to
carry 10 tons of cargo, or up to 50 troops.
In a conventional helicopter, 10 percent of the power
is wasted in driving the tail rotor, which prevents the
helicopter from spinning. The Chinook is stabilized by
two contra-rotating main rotors, so all the engine
power translates into lift.
IAF pilots say that the Chinook’s best feature, given
India’s high Himalayan border, is its superb high-altitude performance. Boeing pilots in Philadelphia recount flying a Chinook over the top of Mount McKinley
in Alaska, America’s highest mountain at 20,300 feet.
Its power allows the Chinook to air-transport a 155-
millimetre howitzer, hanging from a sling under the
helicopter. This lets tactical commanders move artillery guns to inaccessible areas, providing crucial fire
support to troops in extreme altitudes.
Another thoughtful Chinook feature is the positioning of its rear rotors, 18 feet above the ground. That
allows large trucks to drive up to the helicopter’s rear
ramp, and load or unload, while the rotor is spinning.
India’s billion-dollar order has generated about
$300 million in offset liabilities for Boeing. To discharge these, Boeing is sourcing parts from three Indian private manufacturers. Dynamatic Technologies
builds ramps and pylons for every Chinook being built
today; Rossell Techsys fabricates wire harnesses and
Tata Advanced Systems supplies crowns and tailcones.
Boeing executives say, “Every Chinook unit that returns from Afghanistan or Iraq comes to us for ‘after
action reviews’. We ask the pilots, the crew and maintenance crews what works well; what would they like
changed, and what would you tell us to never, ever
change. The one thing that everyone praises is DFICS.
They say they can do missions today that they would
never have tried earlier.
By arrangement with Business Standard
Inside the US facility that will
build India’s Chinook choppers
1. I am a citizen and resident of India. My company wants to send me
to the United States on an H-1B visa. My stay in the US will be for a year
initially and can be extended if needed. Will I be a Non Resident Indian
during my stay in the US?
2. I have demat account and I possess shares. Do I have to sell them
before moving to the US? Can I sell them when I am in the US? Can I
buy shares when I am in the US?
3. Do I have to pay any tax for the trading?
— Vipul Doshi
A Resident is one who during a Financial Year (April to March) satis-
fies any one of the following two conditions; he is in India for at least:
a) 182 days in the FY, or
b) 365 days out of the preceding 4 FYs AND 60 days in the FY.
The stay in India need not be continuous.
Most persons going abroad for employment for the first time will have
the status of resident since they will be covered by clause ‘b’. To provide
for such a situation, if an Indian citizen leaves India in any year for the
purpose of employment, or as a member of the crew of an Indian ship,
the 60 days in the clause ‘b’ above is to be replaced by 182 days. In other
words, they will be treated as Residents only if they are in India for 182
days or more in the current FY. A person who is not a resident is an NRI.
You don’t have to sell the existing shares. However, your demat
account will be redesignated as NON PINS and you can’t buy any shares
in such a demat account. You will have to open a separate demat account
in your new status as an NRI under the PINS scheme. Your bank will
help out with the procedure for this.
You can continue to buy shares when you are in the US.
The tax depends upon the nature of your trade. Long-term gains are
tax-free for all categories of investors, NRIs or otherwise.
I am from India, but now a citizen of the United Kingdom. I have
some real estate in India, which came into my possession long ago
(through inheritance). I do not know the exact cost and date of acquisition of these properties. If I wish to sell the same, how do I go about
determining the tax implications?
If such property has been acquired by the original owner (not the
inheritor) prior to April 1, 1981, then the value of the property as on that
date may be adopted as the cost of the property. In such a case, you may
get the property evaluated by an official chartered valuer who will then
issue you a certificate certifying the value of the property.
For the purpose of calculating capital gain, starting with FY 81-82 as
the base year, the Reserve Bank of India notifies Cost Inflation Index for
every year. Indexed cost is arrived at by multiplying the cost with the
ratio of CIIs for the year of sale and that of acquisition.
Long Term Capital Gain is computed by deducting from full value of
a) any expenditure incurred in connection with the transfer
b) indexed cost of acquisition as computed above
c) indexed cost of improvement.
The tax is 20 percent of such computed gain.
Can NRIs buy Indian shares when in US on H-1B visa?
A N SHANBHAG SANDEEP SHANBHAG
A US Army CH-47F Chinook helicopter makes its way to the Kahiltna Glacier in Denali National Park, Alaska. Indian Air Force pilots say that the Chinook’s best feature, given India’s high Himalayan border, is its superb high-altitude performance.
A N Shanbhag is an investment consultant and author of In the Wonderland of Investment; How to Convert a Taxpayer into a Taxsaver; NRI Investment Guide. This article does not constitute tax or legal advice. Consult your tax or legal advisor before making tax- or legally-related investment decisions. The authors may be contacted at firstname.lastname@example.org.
September 16, 2016