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German arms industry expands presence in India amidst geopolitical shifts

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German arms manufacturers Rheinmetall and Diehl Defence have signed agreements with India’s Reliance Defence for the production of precision-guided munitions, explosives, and propellants in India. This move is driven not only by a desire to diversify supply chains but also by Berlin’s efforts to encourage New Delhi to reduce its arms cooperation with Moscow.

Germany has recently increased military collaboration with India, including joint naval and air force maneuvers. However, German companies still lag significantly behind their Western rivals in the US and France, who are supplying or planning to supply fighter jets for large-scale arms purchases in India.

The recent military conflict between India and Pakistan has intensified competition in the growing Indian defense market, with India shifting its focus toward advanced high-tech weaponry, including combat aircraft.

Reliance Defence, the partner of Rheinmetall, continues to lead the list of Indian companies securing international defense contracts. The company has faced accusations of receiving preferential treatment from Prime Minister Narendra Modi.

Diehl and Reliance partner for 155mm precision-guided munitions

On June 10, Diehl Defence and India’s Reliance Defence announced a strategic cooperation agreement for the production of Vulcano 155mm precision-guided munitions in India. These munitions, equipped with GPS technology and laser-guided targeting, are expected to enhance the Indian army’s precision weapon capabilities.

Reports suggest that Reliance Defence anticipates sales of up to $1 billion. This agreement between Diehl and Reliance was announced just days after another strategic partnership was revealed on May 22 between Rheinmetall AG and Reliance Defence. Under this latter agreement, Reliance will take over the production of explosives and propellants for medium and large-caliber ammunition, supplying them to Rheinmetall.

This strategic partnership provides Rheinmetall with access to critical raw materials and ensures the security of its supply chains, with plans for further expansion of the collaboration. The timeframe and total value of the agreement have not yet been disclosed.

South Asia’s largest manufacturing facility to bolster Indian defense production

To support its collaborations with Diehl Defence and Rheinmetall, Reliance will establish its own manufacturing facility at Dhirubhai Ambani Defence City in India’s Maharashtra state. This facility, projected to be one of the largest in South Asia, will produce precision-guided munitions and boast an annual production capacity of 200,000 artillery shells, 10,000 tons of explosives, and 2,000 tons of propellants, which will be supplied to Rheinmetall.

These two contracts increase Reliance’s international defense partnerships to four, following existing collaborations with France’s Dassault Aviation and Thales. The agreements reflect the newly established Reliance Defence’s plans to become a leading company in India’s rapidly expanding defense sector.

Meanwhile, both Diehl and Rheinmetall aim to capitalize on the Indian government’s plan to achieve $5 billion in arms exports by 2029.

Germany’s move to reduce India’s reliance on Russian military imports

The agreements between Rheinmetall, Diehl, and Reliance Defence are part of intensified German efforts, ramped up in 2022, to reduce India’s high dependence on Russian arms imports. In February 2023, during a visit to India, then-Chancellor Olaf Scholz urged New Delhi for greater support in Western efforts to isolate Russia, including an increase in arms purchases from Germany.

In June 2023, then-Defense Minister Boris Pistorius stated during his visit to India, “It is not in Germany’s interest for India to remain dependent on Russia’s arms deliveries in the long term.” Pistorius’s discussions resulted in the signing of a memorandum of understanding between the two countries for the joint construction of six non-nuclear submarines in India, to be carried out by Germany’s ThyssenKrupp Marine Systems (TKMS) and India’s Mazagon companies.

The “Focus on India” document, adopted by the German government in October 2024, explicitly linked the intention to “more strongly direct India toward German arms companies” with the goal of “reducing India’s arms policy orientation toward Russia.” Simultaneously, both countries have expanded practical military cooperation, including joint air and naval maneuvers in and around the Indian Ocean.

India-Pakistan tensions and the Sino-Western military technology rivalry

The recent military conflict between India and Pakistan, also viewed as a test case for the clash between Western and Chinese military technology, has further intensified competition for India’s large defense market. The armed conflict lasted four days, with both sides employing their most advanced weapons, including modern fighter jets. Reports indicate that the Pakistan Air Force, with the assistance of Chinese-made J-10C fighter jets, managed to shoot down one or more Indian Air Force Rafale fighter jets; both aircraft are classified as 4.5 generation.

Since then, the US has increased its efforts to expand arms sales to India, including the potential sale of fifth-generation F-35 fighter jets. Shortly before the conflict, India signed a billion-dollar deal with France to acquire 26 Rafale fighter jets to replace its Russian MiG-29K fighter jets.

In response, Russia offered to sell India the Su-57, another fifth-generation fighter jet, and unlike the US, Russia proposed manufacturing the jets in India, including technology transfer. This would enable India to equip the aircraft with indigenous radar and weapon systems. Compared to France and the US, Germany has not recently secured significant arms contracts from India, the world’s largest military equipment importer, apart from the submarine agreement.

Controversial Indian giant: Reliance

Reliance Defence is a subsidiary of Reliance Infrastructure, which is part of the Reliance Group. The Reliance Group is one of India’s leading conglomerates, with total assets of approximately $47 billion and a broad base of about eight million shareholders. The group also includes other affiliated companies such as Reliance Communications, Reliance Capital, Reliance Power, Reliance Defence and Engineering Limited, and Reliance Defence Technologies Private Limited.

However, the group has a controversial history. The Reliance Group is owned by Anil Ambani, who was once listed as the world’s sixth richest person in 2008. By 2019, however, he had accumulated $2 billion in debt to various investors. In 2020, Anil Ambani was forced to declare bankruptcy in a British court after being sued by three Chinese banks for unpaid loans totaling $700 million.

Another significant setback came from Swedish telecommunications company Ericsson, which sued one of his companies over unpaid bills. Anil Ambani was saved from a jail sentence in this case only by the intervention of his elder brother, Mukesh Ambani, India’s richest man, who paid the debt.

Allegations of Modi’s support for reliance defence

The crisis-ridden Reliance Group reportedly received a lifeline from Indian Prime Minister Narendra Modi in the form of an excessively expensive arms deal with French company Dassault Aviation to purchase 36 Rafale fighter jets worth a total of $8.8 billion. As part of the contract signed in April 2015, Reliance Group was designated as an offset partner: Dassault was to reinvest a very large portion of the revenues into Reliance to purchase more defense equipment and strengthen indigenous production capabilities.

This was done despite Reliance Group having no prior experience in the defense sector. In fact, Reliance Group established its subsidiary, Reliance Defence Limited, only thirteen days before the deal with Dassault was announced. A few days after the agreement was signed, Reliance Group formed Dassault Reliance Aerospace Limited, which would become Dassault’s most important offset partner. The indebted Ambani Group, with no experience in the aviation sector, suddenly became the guarantor of a multi-billion dollar aviation business.

Diplomacy

Anthropic uncovers Claude use by Iranian, Houthi, and Russian units

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Artificial intelligence company Anthropic has disclosed attempted “abuses” of its Claude AI model ranging from conventional weapons to biological research by state-linked entities, foreign intelligence services, and cybercrime networks, publishing the findings in a detailed threat intelligence report.

A significant portion of the report comprised the development of guided missile software by the Houthis in northern Yemen and the conversion of the model into a military reconnaissance tool by Iran-linked actors seeking to target US naval assets in the Middle East.

Covering the period between December 2025 and August 2026, the report shared details of activities detected across seven primary areas: cyberattacks, influence operations, mass surveillance, conventional weapons development, biological risks, and unauthorised model distillation.

The company announced that it had terminated all accounts violating its rules and shared the resulting data with relevant international counterparts.

According to findings by Anthropic’s Threat Intelligence unit, a weapons cell based in northern Yemen, where the Houthis operate, substituted human software engineers with the Claude Code system across three distinct missile development programmes.

These efforts comprised a tactical rocket equipped with a terminal guidance system powered by a commercial smartphone processor, a multi-stage ballistic missile with a target range exceeding 2,000 kilometres, and missile designs carrying a hypersonic glide vehicle.

The cell utilised the artificial intelligence to adapt open-source autopilot software to the smartphone processor, optimize flight control algorithms, and compile firmware.

Structuring their Claude accounts like a virtual engineering team, the Houthis assigned one account to write code, another to conduct research, and a third to review and audit the written code.

The report noted that the group conducted an actual test launch with a guided rocket in the Yemeni theatre.

Immediately following the failure of the live-fire test, the actors were documented returning to the Claude platform within hours to upload telemetry data and diagnose the cause of the malfunction.

The cell was observed successfully compiling offline simulation tools capable of operating independently even if access to Claude were severed.

Iran tracked US warships and personnel

Another military case detailed in the report involved attempts by Iran-linked cyber actors to target US naval forces in the Middle East.

These actors were found to have scraped open-source military data to draft operational targeting manuals directed against American warships and personnel.

Iran extracted name rosters of American military personnel from the captions of publicly accessible military photographs, monitored vessel and aircraft transponder data, authored code to scan commercial satellite imagery, and mapped vulnerabilities in maritime satellite communication terminals.

Other networks linked to the Tehran government were determined to have developed domestic and regional surveillance systems. A Qom-based unit produced a malicious web browser extension disguised as a prayer-time application to harvest credentials from social network users, funneling the data into a central case management system designated “Arman”.

Additionally, official Iranian institutions reportedly cloned authors’ voices using AI and operated multilingual disinformation networks to lay the groundwork for the supreme leadership succession.

Russia also used it for an autonomous kamikaze drone swarm

The report stated that an independent Russia-based software team developed fully autonomous kamikaze uncrewed aerial vehicle swarm software dubbed “DronDoc” or “Serafim”.

Affiliated with a university connected to the Russian Academy of Sciences, the team was said to have trained the artificial intelligence to distinguish between friendly and hostile elements using footage retrieved from the Ukrainian battlefield.

The developed system was designed with the capability to select targets, execute live human classification, and issue detonation commands without requiring human intervention, with simulations run directly against coordinates in the Donetsk region.

Meanwhile, the Russian-origin “Midnight Blizzard” group targeted the Ukrainian drone supply chain and staged attacks aimed at foreign officials and drone engineers by compromising hotel Wi-Fi networks.

A procurement manager stationed at a design bureau in Moscow was also discovered drafting plans via Claude to circumvent European sanctions. The individual was recorded assembling fraudulent tender and logistics correspondence to transport German-made magnetometers, space-grade photovoltaic sheets, and military aviation oxygen systems into Russia through intermediary firms based in China and Hong Kong.

Biological threats and pathogen engineering

The report disclosed five concrete cases regarding the deployment of artificial intelligence in hazardous biological research. Virologists attached to a military research institute were documented using AI for gain-of-function research aimed at enhancing the transmissibility and immune-evasion capabilities of the mosquito-borne Chikungunya virus.

Similarly, experimental designs were prepared to adapt the H5 avian influenza variant, which carries a 50% mortality rate in humans, to mammals and confer airborne transmission capabilities, while immune-evasion mechanisms of pathogens from the smallpox virus family were modelled.

The identities of paralytic neurotoxins subject to export control lists and haemorrhagic fever virus proteins featured on the World Health Organization’s priority epidemic list were deliberately masked and submitted to the AI for analysis.

In addition, a consultant working on behalf of the Malian State Intelligence Service designed a mass surveillance platform designated “Lakana 360” with the assistance of Claude.

The system was designed to monitor approximately 25 million SIM cards registered across three mobile operators in the country without requiring court orders, intercept audio recordings, and cross-reference records with biometric databases.

Separately, leading Chinese artificial intelligence firms including Alibaba, Moonshot, DeepSeek, Zhipu, and Xiaomi were alleged to have initiated hundreds of millions of unauthorised sessions to extract the logical reasoning chains of Claude models. Moonshot and DeepSeek platforms reportedly routed their own users’ queries secretly through Claude, in the process exposing Chinese police surveillance feeds from hundreds of cameras covering military facilities in Chengdu, internal credentials of Chinese state-owned enterprises, and live database access codes connected to the Russian Defence Ministry to third parties.

Türkiye detail in the report

The report also detailed cases involving the abuse of the Claude AI model, incorporating findings concerning an Istanbul-based technology firm.

In case GTG-84005 of the intelligence report, an operation aimed at commercial election manipulation targeting voters in Malaysia was intercepted.

According to the findings, the operation operated under the guise of a startup providing cyber intelligence and counter-disinformation tools. Anthropic determined that Istanbul-based BBS Bilisim Teknolojileri was behind the infrastructure.

According to documents, the company marketed the architecture as a paid influence operation service styled as a “military-grade, AI-powered, real-time political operations ecosystem”.

Managing roughly 1,000 synthetic X accounts, the system processed demographic and electoral data across 222 parliamentary constituencies in Malaysia, calibrating targeting around sensitive social fault lines including ethnicity, religion, and the monarchy.

The network also circulated content from Russian and Chinese state media masquerading as independent Malaysian news via an artificial media outlet designated “Malaysia Pulse”, while manufacturing fraudulent intelligence dossiers targeting an opposition politician and civil society organisations.

Anthropic reported that the network received a request to generate 1 million artificial impressions in support of the Malaysian Prime Minister and sought to secure a contract with the country’s national communications regulatory authority.

While no evidence emerged that the undertaking succeeded, the associated user accounts were closed and operational digital indicators were shared.

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EU pursues closer ties with Israel on space and air defence

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The EU is turning to Israel to bolster its new initiatives in high-tech air defence and space capabilities.

Shimrit Maman, head of the Israel Space Agency, travelled to Brussels this week and met on Tuesday with European Commissioner for Startups, Research and Innovation Ekaterina Zaharieva to discuss key sectors, including artificial intelligence and robotics.

The visit took place ahead of European Commission President Ursula von der Leyen’s first major speech on space, scheduled for Thursday at a summit in Paris.

In the speech, Von der Leyen is expected to warn against mounting hostilities and emphasise the necessity of strengthening Europe’s presence in space.

“It’s very hard to do everything by yourself,” Maman told Politico, adding that the militarization of space is “already happening, it’s just we are not aware of the extent,” and noting that allies are showing growing interest in “dual-use” technologies intended for both civilian and defence purposes:

“One thing we’re working on is early-warning systems. For example, during the last wave [of missile attacks] with Iran, we saw this very clearly. How we were getting the alerts to all the civilians in Israel, and that made the casualties so low. This is part of the system. We’re working on a very holistic view, where you can alert in advance, the system alerts the citizens.”

Following several years of effective disengagement caused by political tensions surrounding the invasion of Gaza, the EU has recently begun forging closer military and technological ties with Israel through a series of agreements.

Competition from Washington and strategic rivalry with Moscow and Beijing have nevertheless underlined the requirement for allies possessing sophisticated industrial capacity.

In 2024, European Commission President Ursula von der Leyen backed calls by Polish Prime Minister Donald Tusk and Greek Prime Minister Kyriakos Mitsotakis to create an EU-funded air defence shield.

Three senior officials involved in the discussions said, however, that the plans stalled after officials in the Commission and several national capitals concluded that the project would require reliance on Israeli air defence technology, which was considered too sensitive one year into the Gaza conflict.

Yet Israel’s Rafael, which is expanding its European operations significantly, has now confirmed that it will open a factory to manufacture the Iron Dome air defence system at a former Volkswagen plant in Germany.

One week ago, Greece signed a 3 billion euro agreement with the Israel Ministry of Defense.

The deal provides for the establishment of a new multi-layered air defence network designed to shoot down drones, hostile jets, and rockets.

“We see everything integrating into this multi-layer defence approach,” Maman said, highlighting satellite imagery and artificial intelligence modelling as primary focal points for joint development efforts:

“I’m not only seeing defence as ballistic missiles from Iran… think about a fire, a flash flood or even a long drought… we have a proven track record, and we’re getting really good results.”

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UK reassures US that new Israeli settlement sanctions are symbolic

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The UK has reportedly engaged in behind-the-scenes talks to avoid a backlash from the US over anti-Israel sanctions scheduled for announcement today.

According to a report by Bloomberg, Andy Burnham’s government is expected to ban trade with Israeli settlements in the West Bank today.

Burnham is seeking to pursue a firmer stance on an issue of high importance to the governing Labour Party, though one that risks angering US President Donald Trump.

Foreign Secretary Ed Miliband will unveil a new sanctions regime targeting Israel but limited to Jewish settlements in the West Bank, according to sources familiar with the matter.

Burnham and Trump spoke by telephone on Monday, the Prime Minister’s Office said. A statement noted that the two leaders discussed a two-state solution for Israel and the Palestinian territories.

The discussion suggests that Burnham used the call to notify Trump that sanctions against Israel were imminent.

The proposals under review included a new sanctions regime with measures to block the exchange of goods and services with Israeli settlements.

Miliband also evaluated expanding existing human rights sanctions to encompass the blocking of aid, which has drawn criticism for exacerbating the humanitarian crisis in Gaza.

The Foreign Secretary further considered explicitly endorsing the International Court of Justice’s non-binding 2024 opinion that declared Israel’s occupation of territory currently recognised by the UK as the State of Palestine to be unlawful.

Even so, UK officials fear the announcement could cause an early setback in Burnham’s relationship with Trump.

To defuse a backlash from the Trump administration, British diplomats privately informed the US that the sanctions are largely symbolic and will have no tangible impact on the UK’s broader trade or security ties with Israel, according to sources familiar with the discussions.

The proposals were drawn up after Israel decided to issue tenders for the construction of 1,200 settlement housing units in an area of the West Bank.

Disputes between Israeli settlers and Palestinians have intensified in recent months as Israeli Prime Minister Benjamin Netanyahu faces a difficult battle to retain his seat in a general election scheduled for 27 October.

Burnham joined the leaders of Canada and five European governments, including France, Germany, and Italy, in signing a statement that condemned the housing plan as “unacceptable” and urged Netanyahu to withdraw the tender.

In a separate statement, German Chancellor Friedrich Merz condemned a call by Israeli National Security Minister Itamar Ben Gvir for “nightly assassinations” in Gaza.

Burnham is eager to demonstrate early to the Labour Party that he is adopting a more critical approach toward Israel than his predecessor, Keir Starmer.

Although Starmer hardened his stance against Israel during his two years in office, including by formally recognising the State of Palestine, his initial refusal to demand that Netanyahu halt military operations in Gaza divided the party.

This division led to a decline in Labour’s poll ratings and boosted electoral gains for the Green Party across the country.

Burnham’s return to Parliament last month led to Starmer’s resignation. Burnham apologised for Labour’s handling of Israel’s military operation in Gaza under his predecessor, stating that the party “did not adopt the right stance”.

Last month, Burnham’s new Defence Secretary, Wes Streeting, who faced intense competition from a Muslim independent candidate in his northeast London constituency at the last general election, stated that Israel had fallen “short” of international standards.

US Ambassador to Israel Mike Huckabee told the BBC’s “Newsday” programme that there would “undoubtedly” be a US response.

Accusing the Labour Party of “discriminating against the Israeli government”, Huckabee said: “It is like throwing a rock and not knowing where it lands. The UK is a sovereign country and can do as it pleases, but so is the US.”

Republican Florida Congressman Randy Fine also warned that British firms would be barred from doing business with local governments in the state if sanctions were imposed.

In a post on X, Fine said: “Florida has made its stance clear. Any company—or country—that boycotts Israel will be boycotted by Florida.”

Labour MPs and Jewish groups have warned the government that any sanctions against the settlements could amount to a “de facto boycott” of Israeli goods and compromise the safety of British Jews.

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