Eyes on Defence Deals, Western Powers Court PM Narendra Modi

Western governments are rushing to visit Prime Minister Narendra Modi, drawn by the prospect of multi-billion-dollar deals as the Indian government prepares to open the nascent defence industry to foreign investment.

Senior politicians from France, the United States and Britain arrive in quick succession over the next 10 days as Prime Minister Modi prepares to accelerate the modernisation of the country's mostly Soviet-era weaponry.

The PM intends to build up the India's military capabilities and gradually turn the world's largest arms importer into a heavyweight manufacturer - a goal that has eluded every prime minister since independence in 1947.

On the table is a proposal circulated within the new government to raise caps on foreign investment - with one option to allow complete foreign ownership of some defence projects.

"All the countries are trying to make their case, especially as there is the sense that the Indian market will undergo a shift," said Harsh Pant, professor of international relations at King's College London.

"They get a sense from their dealings that something dramatic is going to happen and they want first-mover advantage," said Pant, who specialises in defence.

First to arrive in New Delhi will be French Foreign Minister Laurent Fabius, whose top priority is to close a stalled deal to sell India 126 Rafale fighter jets, built by Dassault Aviation, for an estimated $15 billion.

Fabius, who arrives on Monday, will meet PM Modi as well as Defence Minister Arun Jaitley who also holds the finance portfolio - and can therefore decide both whether to sign the deal and when to release the money.

US Senator John McCain is also due in India next week. Mr McCain, whose Arizona constituency includes weapons makers such as Boeing and Raytheon, told the Senate on Thursday that Washington should seek to bolster New Delhi's economic and military rise.

"This is an area where US defence capabilities, technologies, and cooperation - especially between our defence industries - can benefit India enormously," McCain said of India's drive to modernise the armed forces.

UK STILL HOPEFUL ON FIGHTER JET

In the second week of July, Britain is likely to send in Foreign Secretary William Hague and finance minister George Osborne, a British government source said on Friday.

Britain has drawn some cheer from the slow progress of the negotiations for the Rafale deal. The Eurofighter Typhoon was shortlisted along with the Dassault fighter before India announced the French jet was the winner.

Cost escalations and disagreements about building the Rafale in partnership with the state-owned Hindustan Aeronautics Limited have complicated New Delhi's talks with France, and London has never entirely given up hope that it will return to the race.

However, on Thursday, one source at India's defence ministry said the deal was likely to be finally closed during Fabius' visit and could be signed this year. A French foreign ministry source said talks were ongoing, but refused to provide more detail. (India's Rafale Fighter Jet Deal in Final Lap, Awaits Government's Nod)

Russia, for years India's top weapons supplier, pipped all three countries to the post, sending Deputy Prime Minister Dmitry Rogozin to visit the new government in Delhi two weeks ago. Washington last year replaced Moscow as India's top defence supplier, according to IHS Jane's.

The Western nations will have noted that External Affairs Minister Sushma Swaraj expressed displeasure with Russia's recent offer to sell Mi-35 attack helicopters to arch-rival Pakistan.

"I don't think it's a competition," US Assistant Secretary of State Nisha Biswal said after an early post-election visit to New Delhi.

"India will have strong and positive relationships with a variety of countries and that is to be encouraged," said Biswal. "We want to see India taking on a stronger and a leadership role in the region and around the world so we welcome that."

$6 BILLION SPREE

India spent some $6 billion (approximately Rs. 36,000 crore) last year on weapons imports. It makes few of its own weapons, beyond ballistic missiles and assembly lines for foreign jets.

On Thursday, the government signalled it was in the mood for liberalisation by allowing manufacturers to build more defence components without licences, making it easier for domestic firms to partner foreigners.

At present, foreign companies can only invest 26 percent in Indian defence projects without committing to technology transfer, which has put off many investors.

Before the election, sources in PM Modi's Bharatiya Janata Party (BJP) said there was a plan to increase the cap to 49 percent.

"For higher-tech intellectual property we would want to go over 50 percent to be in a position to share technology that we have significant investments in," said Phil Shaw, chief executive of Lockheed Martin India Pvt Ltd.

"An uplift from 26 to 49 percent maintains the status quo and may not be sufficient incentive to make an investment here."

Lockheed Martin already has a 26 percent investment in an Indian joint venture with Tata Advanced Systems that manufactures airframe components for the C-130J Super Hercules cargo lifter.

India's Department of Industrial Policy and Promotion has circulated a discussion document that proposes allowing up to 100 percent foreign direct investment, or FDI, in defence production, two government officials told Reuters.

The note suggested allowing 100 percent FDI in manufacturing of state-of-the art equipment, one of the officials said. It also recommends a cap of 49 percent for investments which do not involve transfer technology and a 74 percent ceiling in such cases where the foreign investor is ready to share technology know-how, the official added.

Last week, Commerce and Industry Minister Nirmala Sitharaman said foreign investment in the sector would help increase defence preparedness of the country and reduce import dependence, saving billions of dollars in foreign exchange.

However, she said the government was yet to take a final call on increasing the FDI ceiling and the decision would be taken by Mr Jaitley and PM Modi. The proposals face pockets of resistance in the Indian industry, Mr Modi's party and the military establishment.

AK Antony, who was the country's longest serving defence minister until his Congress party's election defeat in May, said this week that allowing higher foreign investment in defence would be "suicidal".

NDTV

India's Rafale Fighter Jet Deal in Final Lap, Awaits Government's Nod

The Indian Air Force or IAF may lose its traditional conventional edge against Pakistan if the contract to buy 126 Rafale medium multi-role combat aircraft or MMRCA is not clinched immediately, senior IAF officials told Defence Minister Arun Jaitley at an extensive briefing recently. (Defence Minister Briefed on Indian Air Force's Operational Preparedness)

French aerospace major Dassault Aviation had won the contract to supply the fighter jets to the IAF in 2012.

The Air Force, which ideally requires 44 squadrons but can manage with 39, currently only has 32 squadrons; 12 of them of the near-obsolete MiG-21s.

Mr Jaitley had only one query: what is the cost of the contract?

The IAF's answer -- Rs. 100,000 crore spread over 10 years -- immediately evoked a positive reaction from Mr Jaitley, sources in the Ministry of Defence told NDTV. (Dassault Hopes to Sign Rafale India Deal This Year)

The enthused IAF brass now says that if the government gives the final clearance, the massive, and in many ways the first-of-its-kind contract, may be clinched in the next six months.

Three sub-sets of the complicated deal have been completed, say sources. The committees that were in charge of Offsets, Maintenance, Transfer of Technology have concluded their work; it took them over two years to prepare documents running into thousands of pages. These include details of work share between Dassault and India's Hindustan Aeronautics Ltd or HAL, liabilities and costs to maintain and run the 126 jets. (A big step in India's Rafale jet deal with France)

Over 41 articles in the defence procurement procedure or DPP have been taken on board while arriving at the final documentation. HAL has been designated the lead domestic production agency. 18 of the 126 jets will be produced in France and the remaining 108 will be manufactured at the production unit in India. (Depleted fighter fleet is worrisome, says Air Chief)

But the committee responsible for costs and contract is yet to finalise its report. Once the deal officially receives clearance, this part of the contract may be ready for signing in less than two months, say sources. (France sees first Rafale jet deliveries to India by 2016)

Meanwhile, many of Rafale's competitors are lobbying hard against the contract and running down the fighter aircraft over various counts, including 'prohibitive' costs.

But the IAF top brass is clear that the process to buy the MMRCA is irreversible, notwithstanding a view that the IAF must induct the HAL-made Light Combat Aircraft (LCA) Tejas instead of buying the expensive Rafale.

IAF officials point out that the Tejas is yet to receive final operational clearance despite the home-grown fighter aircraft being in the making for over 30 years. As per revised timelines, the first full Tejas squadron in the Initial Operational Clearance configuration will be in place only by 2016-2017.

"We have been hand-holding the LCA for a long time and will continue to support it. But it is not a replacement for a medium, multirole fighter aircraft. Its reach is barely 200 km while we need an aircraft with a reach of at least 1000-km if we have to pose any challenge in the Tibet Autonomous Region, where India expects a major threat to its air combat power in case of a conflict with China," said a top IAF officer.

Meanwhile, the Rafale deal is likely to be on top of the agenda during French Foreign Minister Laurent Fabius's two-day visit to India, which starts today.

The question now is whether prime minister Narendra Modi and defence minister Arun Jaitley will also treat the deal as a matter of top priority.

NDTV

Indian Defense Market Might Be About to Really Heat Up

A number of conditions are accumulating that could turn India — already the world’s leading importer of arms — into an even bigger hotbed of defense spending and investment.

The Wall Street Journal has the story on a proposal that would allow foreign companies to have full ownership over defense firms. That’s up from a 26 percent cap, which analysts have said has been an impediment to foreign investment.

The new defense minister? He’s expected to devote more money to weapons. On the campaign trail, new Prime Minister Narendra Modi promised “long-overdue military modernization.”

The Ministry of Commerce has relaxed norms on defense licensing, a move the Federation of Indian Chambers of Commerce and Industry believes will revive the Indian defense industry.

And the United States could be well-positioned to capitalize on this. Vikram J. Singh, vice president for national security and international policy at the Center for American Progress, and Joshua T. White. deputy director for South Asia at the Stimson Center, recently made the argument that, “Actions taken in New Delhi and Washington now will determine if the two nations can break through a successful but largely transactional relationship toward strategic partnership that delivers for both nations on shared security interests.”

There are impediments to some of the growth potential, given the history of India’s military revitalization efforts, but right now there are plenty of signs pointing to flowing money and structural overhauls being very realistic possibilities.

- Defence news

Boost for Defence as licensed items list reduced by 60%

The government has spelt out the industrial licensing policy for defence production, listing items that will require permission to manufacture in a measure that industry and officials say would help encourage new players in the sector and boost investment.

Anything not mentioned on the list can be manufactured by the industry without a licence from the government.

The government has reduced the items requiring industrial licences by about 60%. "All products like castings, assemblies, etc. have been removed," an official at the department of industrial policy & promotion (DIPP) said.

"It is a breakthrough in giving thrust to manufacturing in the economy." This clarification will open many defence goods not covered by industrial licensing to foreign direct investment (FDI).

FDI in defence is currently capped at 26%, but according to experts, many of the goods previously classified as defence-related may now be considered under sectors where the limits for foreign money are as high as 100%.

Items that are not included on the list would not require industrial licence for defence purposes, the commerce and industry ministry said in a notification. "Further, it is clarified that dualuse items, having military as well as civilian applications other than those specially mentioned on the list, would also not require industrial licence from (a) defence angle."

Earlier, there were several lists doing the rounds with a lot of items classified as dual use, which created confusion and licensing constraints. Four broad categories of defence equipment will continue to require industrial licence: arms and ammunitions; defence aircraft and space aircraft; tanks and other armoured fighting vehicles; and warship equipment.

Industry sees this as a step towards self-sufficiency in defence production. "We are happy to see that the ministry of defence has pruned the list and kept it to the bare minimum," said Baba N Kalyani, chairman of the committee on defence at the Confederation of Indian Industry.

Early this month, the government took its first step towards allowing up to 100% FDI in the defence sector. In a draft Cabinet note, DIPP proposed three different FDI caps to promote technology transfer and inflow of foreign funds in defence manufacturing FDI will be limited to 49% when there is no technology transfer involved while up to 74% foreign money will be allowed when the investor is also bringing in technology, and no FDI limit will apply when the technology transferred is state of the art.

Current policy allows FDI up to 26% in the sector, but higher limits can be allowed on a case-bycase basis. A higher FDI limit is seen by many as a step towards encouraging domestic production of largely imported defence supplies.

"The Indian defence industry is already at the bottom of the value chain and there is very less incentive for anyone to set up a defence industry in India for various reasons," Kalyani said. It is important to maintain a fair balance between addressing genuine security concerns and promoting India's defence industry, said Kalyani.

Defence news

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Rafale Deal Likely to Figure During French Foreign Minister's India Visit

The multi-billion dollar Rafale combat aircraft deal, the Jaitapur nuclear power plant and climate change are expected to figure prominently during talks French Foreign Minister Laurent Fabius' will have with Indian leaders during his two-day visit here starting on Monday.

The two sides are also likely to discuss the over Rs. 20,000 crore Maitri surface-to-air missile system project alongside holding parleys on the regional and global security situation including Afghanistan, Iraq and Syria.

The Rafale deal, estimated to be over Rs. 60,000 crore, is also expected to come up during the talks along with the SR-SAM project, which is in the final stages of negotiations between the two governments, sources said here.

India had selected the French Rafale combat aircraft two years ago but the negotiations are still continuing between Indian Defence Ministry and the French firm Dassault Aviation as there have been issues over pricing and work-sharing between the two sides.

During the interaction between External Affairs Minister Sushma Swaraj and Fabius, the two sides are expected to take up Jaitapur nuclear power project where the two countries are planning installation of six nuclear power plants in a phased manner, the sources said.

The French side was waiting for the new government to assume office in Delhi to restart negotiations as it wanted to know the approach of the new dispensation under Prime Minister Narendra Modi on the issue of using nuclear energy, they said.

Asked if the French side was comfortable with the nuclear liability laws of India, the sources said the French government wanted to understand and discuss with India about the way the liability laws would be implemented and its possible consequences.

NDTV

France likely to push for early fighter aircraft deal with India

France is likely to seek an early clinching of a $20 billion (around Rs.1.2 trillion) deal to sell India 126 fighter aircraft during the visit of foreign minister Laurent Fabius to New Delhi early next week, people close to the development said on Thursday. Both sides are to sign 15-16 preliminary pacts to cement cooperation in higher education during Fabius’ three-day visit. Discussions between Fabius and his Indian host Sushma Swaraj would cover civil nuclear energy, trade, tourism, space and climate change. Terrorism and unrest in Afghanistan, Iraq, Syria and western Africa besides the economic situation in the euro zone are the other issues likely to figure in the discussions. Fabius, a former prime minister of France who arrives on Sunday night, is the first foreign minister from a Western nation to visit India since the new National Democratic Alliance government took office a month ago. One of his first engagements on Monday would be a visit to the Indian Space Research Organisation’s Sriharikota launch site from where an Indian rocket carrying a French satellite Spot 7 will be sent into orbit, one of the people said. All of them declined to be named. “The purpose of the visit clearly is to reach out to the new Indian government and have a clear idea of the direction the government is taking,” said one of the people. Fabius “will confirm a standing invitation” to Narendra Modi to visit France, the person said, adding that the invitation was extended to Prime Minister when French President Francois Hollande conveyed his congratulations to Modi for winning the 2014 general elections. France hopes Modi will visit by the end of the year, the person said. When asked about the contract for the multi-billion dollar combat aircraft project to acquire 126 French Rafale fighters, the person said there was no timeline for the conclusion of the deal. The deal includes many issues like the transfer of technology, offsets under which French aircraft maker Dassault Aviation will have to plough back 50% of the contract value back into India and partnership with the state-run Hindustan Aeronautics Ltd (HAL) for co-production. “With regard to the partnership with HAL, which is designated as the key agency for the implementation of the transfer of technology and Aviation and HAL have reached an agreement a month production, Dassault ago on how to organize the Rafale production in India. This was a very important step,” said the person. In 2012, India chose the Rafale over three others, including the Eurofighter Typhoon manufactured by the European Aeronautic Defence and Space Co, which was earlier this year rebranded as Airbus Group NV. India has been looking for an fighter jet for its Air Force. The Air Force has 34 squadrons as against an operational requirement of 44, according to newspaper reports. On civil nuclear cooperation, the person said the French were keen on seeking clarifications on how India’s nuclear liability law would be implemented and what would be the consequences of any possible nuclear accident. In 2010, India’s state-run Nuclear Power Corp. of India Ltd two European Pressurised signed a pact with France’s Areva SA to buy each with a capacity to produce 1,650MW of electricity Reactors (EPR) and uranium supply for a period of 25 years at Jaitapur in Maharashtra. These units are first of six that will be constructed at Jaitapur and are expected to be commissioned by 2018. The complex will have an overall capacity of 10,000MW. Referring to liability of the vendor of an atomic power plant in case of an accident, a second person familiar with the developments said, “We don’t expect any accidents of a nuclear nature.” There were two EPRs under construction in China and a further two in Britain, the person said. The fate of the India-European Union free trade agreement, in negotiations since 2007, would also be raised by French side at the talks with Swaraj, said a second person. With France hosting the next conference of parties on climate change, India and France will be discussing how to reach a consensus at the meeting scheduled to be held in December 2015. “Our approach as president of the conference is to reach out to every participant and help find a consensus to limit carbon emmissions,” this person said. The visiting French minister will also likely discuss the situation in Syria, the presence of European nationals among the fighters in that country as well as the surprising advance made by the Islamic State of Iraq and the Levant in Iraq, the second person cited above said. 


- Livemint

France is likely to seek an early clinching of a $20 billion (around Rs.1.2 trillion) deal to sell India 126 fighter aircraft during the visit of foreign minister Laurent Fabius to New Delhi early next week, people close to the development said on Thursday. Both sides are to sign 15-16 preliminary pacts to cement cooperation in higher education during Fabius’ three-day visit. Discussions between Fabius and his Indian host Sushma Swaraj would cover civil nuclear energy, trade, tourism, space and climate change. Terrorism and unrest in Afghanistan, Iraq, Syria and western Africa besides the economic situation in the euro zone are the other issues likely to figure in the discussions. Fabius, a former prime minister of France who arrives on Sunday night, is the first foreign minister from a Western nation to visit India since the new National Democratic Alliance government took office a month ago. One of his first engagements on Monday would be a visit to the Indian Space Research Organisation’s Sriharikota launch site from where an Indian rocket carrying a French satellite Spot 7 will be sent into orbit, one of the people said. All of them declined to be named. “The purpose of the visit clearly is to reach out to the new Indian government and have a clear idea of the direction the government is taking,” said one of the people. Fabius “will confirm a standing invitation” to Narendra Modi to visit France, the person said, adding that the invitation was extended to Prime Minister when French President Francois Hollande conveyed his congratulations to Modi for winning the 2014 general elections. France hopes Modi will visit by the end of the year, the person said. When asked about the contract for the multi-billion dollar combat aircraft project to acquire 126 French Rafale fighters, the person said there was no timeline for the conclusion of the deal. The deal includes many issues like the transfer of technology, offsets under which French aircraft maker Dassault Aviation will have to plough back 50% of the contract value back into India and partnership with the state-run Hindustan Aeronautics Ltd (HAL) for co-production. “With regard to the partnership with HAL, which is designated as the key agency for the implementation of the transfer of technology and production, Dassault Aviation and HAL have reached an agreement a month ago on how to organize the Rafale production in India. This was a very important step,” said the person. In 2012, India chose the Rafale over three others, including the Eurofighter Typhoon manufactured by the European Aeronautic Defence and Space Co, which was earlier this year rebranded as Airbus Group NV. India has been looking for an fighter jet for its Air Force. The Air Force has 34 squadrons as against an operational requirement of 44, according to newspaper reports. On civil nuclear cooperation, the person said the French were keen on seeking clarifications on how India’s nuclear liability law would be implemented and what would be the consequences of any possible nuclear accident. In 2010, India’s state-run Nuclear Power Corp. of India Ltd signed a pact with France’s Areva SA to buy two European Pressurised Reactors (EPR) each with a capacity to produce 1,650MW of electricity and uranium supply for a period of 25 years at Jaitapur in Maharashtra. These units are first of six that will be constructed at Jaitapur and are expected to be commissioned by 2018. The complex will have an overall capacity of 10,000MW. Referring to liability of the vendor of an atomic power plant in case of an accident, a second person familiar with the developments said, “We don’t expect any accidents of a nuclear nature.” There were two EPRs under construction in China and a further two in Britain, the person said. The fate of the India-European Union free trade agreement, in negotiations since 2007, would also be raised by French side at the talks with Swaraj, said a second person. With France hosting the next conference of parties on climate change, India and France will be discussing how to reach a consensus at the meeting scheduled to be held in December 2015. “Our approach as president of the conference is to reach out to every participant and help find a consensus to limit carbon emmissions,” this person said. The visiting French minister will also likely discuss the situation in Syria, the presence of European nationals among the fighters in that country as well as the surprising advance made by the Islamic State of Iraq and the Levant in Iraq, the second person cited above said.

Read more at: http://www.livemint.com/Politics/BXiVYBxq76aXwfafFVB1EP/France-likely-to-push-for-early-fighter-aircraft-deal.html?utm_source=copy

Obama keen to expand ties with Modi government

Recognising that India is one of its most important strategic partnerships, the Obama administration is keen to push boldly on expanding the envelope of cooperation with the new Narendra Modi government, analysts suggest.
"I think Prime Minister Modi has gotten off to a splendid start on both the domestic and foreign policy fronts," Ashley J. Tellis, senior associate at Carnegie Endowment for International Peace, a Washington think tank told IANS.
"There is much hard work which lies ahead-and involves difficult policy choices particularly in regards to economic management," Tellis, who as senior adviser to the Bush administration was intimately involved in negotiating the civil nuclear agreement with India, said.
The Obama administration is looking forward to working closely with Modi and a successful visit to Washington by the prime minister in September, he said.
"There is a clear recognition here that India is one of our most important strategic partnerships and the administration is hoping to push boldly on expanding the envelope of cooperation," Tellis said.
Meanwhile, at the State Department spokesperson Marie Harf told reporters on Thursday that US investment in India had been a key part of US discussions with India for a long time even before Modi took over.
"We certainly talk quite a bit about the economic relationship with India, whether it's investing in certain parts of its economy; whether it's increasing exports and imports and private sector trade," she said.
"That's certainly been a key part of our discussions with the Government of India, not just since Mr. Modi has been in office, but before that for a long time as well."

 indiatoday

Read more at: http://indiatoday.intoday.in/story/obama-keen-to-expand-ties-with-modi-government/1/368768.html

How U.S. can reinvigorate India defense ties

Narendra Modi’s landslide victory in last month’s Indian general election has raised hopes that the country will break through the policy stagnation of the last decade and advance reforms that can jump-start India’s economy and bolster its standing on the world stage.
Modi’s declared priorities focus heavily on the economy, and the U.S. government should make economic statecraft a central pillar of engagement with India. But Washington should not lose sight of the most successful area of U.S.-India cooperation to date: the thriving defense relationship. Actions taken in New Delhi and Washington now will determine if the two nations can break through a successful but largely transactional relationship toward strategic partnership that delivers for both nations on shared security interests.
On the U.S. side, four priority areas matter most to reinvigorate U.S.-India defense ties:
First, the Obama administration should continue to put forward innovative defense trade proposals, regardless of how responsive Modi’s government appears to be in the near-term. Speaking at the Shangri-La Dialogue in Singapore last month, U.S. Secretary of Defense Chuck Hagel announced that he would take “an active and very personal role” in what has come to be known as the U.S.-India Defense Trade and Technology Initiative (DTTI), and designated the Department’s Undersecretary for Acquisition, Technology, and Logistics, Frank Kendall, as the initiative’s American lead.
This is welcome news. The original champion of the DTTI, former Deputy Secretary Ashton Carter, worked closely with former Indian National Security Advisor Shivshankar Menon to raise the profile of U.S.-India defense trade and overcome bureaucratic hurdles in both countries. Within the U.S. government, this informal initiative resulted in a sustained effort to clarify and ease Cold War-era restrictions on technology transfers to India, and to identify dozens of high-tech co-production and co-development opportunities for consideration by U.S. and Indian industry and policymakers.
This effort must continue and expand. Like his predecessors, Modi has advocated building an indigenous defense base. But he may better understand that India cannot succeed in doing so on its own. He has signaled that his government may finally raise limits on foreign direct investment (FDI) in the defense sector, which are currently stuck at 26 percent in most cases and make major international defense companies reluctant to partner with Indian industry. Modi might also be prepared to modify India’s onerous “offsets” policy that makes many good defense deals almost impossible to close, and to reform India’s sclerotic acquisitions process. If he receives strong and sustained backing from Hagel and the White House, Kendall is well positioned to quietly press for – and capitalize on – Indian reforms, and continue the hard work of bringing to fruition promising joint defense trade opportunities.
Second, instead of merely reauthorizing the landmark 2005 New Framework for the U.S.-India Defense Relationship that expires in 2015, Washington and New Delhi should jointly draft an updated vision for the coming decade of defense partnership. The end of the New Framework’s ten-year term can be used to take stock of the systems and institutions that were created for defense cooperation, to enhance those that have borne fruit and to jettison those that have not. The U.S. should propose ways to incorporate uniformed military officials from both sides into the high-level Defense Policy Group and the annual Strategic Dialogue; to formalize information sharing; to bring leaders from the U.S. Pacific Command and Indian regional commands into bilateral defense discussions; and to develop a capabilities-based framework for prioritizing bilateral and multilateral exercise engagements. This is the moment to revisit issues from the truly strategic down to the nuts-and-bolts of the defense relationship – and lay the foundation for a transformative decade of defense ties.
Third, the United States must focus on deepening defense cooperation and exercises, even in the present climate of budget retrenchment. Sequester forced the termination of the marquee Red Flag Air Force exercises and other engagements last year, and it is these kinds of disruptions that call into question the commitment of the United States and weaken our partnerships.
It is time to double down on military to military engagements, not retreat. The U.S. should propose greater interaction at the level of the service chiefs and the regional commanders. This could have long-term value in the naval domain, as both India and the United States want to see India emerge as the lead provider of security in the Indian Ocean Region. Personal ties between U.S. and Indian general and flag officers would also prove valuable if and when India faces another serious crisis – for example, a terrorist attack like the one that took place in Mumbai in 2008, or an unexpected naval confrontation in the Indian Ocean – by providing important channels for consultation and de-escalation.
Finally, with President Obama’s announcement of the next phase of the U.S. drawdown from Afghanistan, the United States would be wise to build deep outreach on regional security with the new Indian leadership. (The same, incidentally, must be done with Pakistan.) Just as Pakistanis are often convinced that Washington has chosen New Delhi as its preferred partner in the region, so many Indians are convinced that the United States has signed over Afghanistan’s future to Islamabad. The Obama administration launched regular joint consultations with the previous government in India, sending leaders from the White House, State, and Defense to have frank discussions on developments in Afghanistan and beyond.
But with so much change at hand, anxiety in New Delhi continues to grow and will be acute for a new and untested government. Attacks on Indian interests in Afghanistan, such as the recent assault on the Indian consulate in Herat, have heightened Indian fears about the pace of the U.S. withdrawal. The U.S. government should ensure that frank consultations on Afghanistan with both Indian and Pakistani leaders become more regular and more substantive. Moreover, these talks should expand to cover developments across the region, not just Afghanistan.
As the world’s most populous democracy, the leading importer of defense equipment, and an emerging provider of security in Asia, India is integral to long-term American efforts to rebalance to the Asia-Pacific region. And with defense trade having grown from virtually nothing to some $9 billion since 2005, many aspects of the defense relationship are clearly on the right track. With his overwhelming electoral mandate, Narendra Modi is positioned to shake up Indian defense. His reforms can only bear fruit for the U.S.-India relationship, however, if Washington steps up its own game on defense trade, security cooperation – and the serious consultations with Indian leaders on the regional challenges that lie ahead.

- Vikram J. Singh and Joshua T. White/ CNN

Nod for private companies to make defence goods

The government's decision on deregulation will give private companies the right to manufacture a number of defence goods. Till 1991 when economic reforms were initiated, the government licensed a bulk of industrial products, including automobiles and white goods. Over the years, the list has been pruned, and now only a handful of industries such as defence, cigarettes, explosives, distillation and brewing of alcoholic drinks and hazardous chemicals require licences. In all other sectors, companies can freely enter and manufacture whatever they want without any restriction on quantity.

So far, all defence items required licences, which were tough to come by. The ministry has for long been accused of sitting on applications for years. "Often it took up to five years to get a licence. But those days are over as 55% of the items have been removed from the list," a senior official said. Now, companies won't need a licence to manufacture components, castings and sub-assembly, the official added.

In his speech to both Houses of Parliament earlier this month, President Pranab Mukherjee had spoken about encouraging private investment in defence, a theme that ran through the BJP's election campaign. "It shows the government is serious about involving the private sector. There will be more competition, but it gives a chance to many companies to participate in the defence spectrum. For new players and SMEs, it often takes time to get a licence as they have to go through a process of assessment. As a result, people can't make long-term plans," said M V Kotwal, president, heavy engineering at L&T. The company has received licences to manufacture submarines, aircraft and radar parts, among other items.



Instead of the long list of licenced defence goods, the department of industrial policy and promotion has notified a smaller negative list, which includes items such as tanks, vehicles fitted with military mountings of arms and ammunition or with equipment for mine laying, defence aircraft, including helicopters, UAVs and warships.

Times of india

India's first indigenous anti-submarine warfare ship ready

India's first indigenously-built antisubmarine warfare corvette INS Kamorta is ready to be commissioned into the Indian Navy next month, defence officials said here on Tuesday.

Built by the Garden Reach Shipbuilders & Engineers Ltd (GRSE), Kolkata, it will be the first warship armed with an indigenous rocket launcher for anti submarine warfare, they said.

The corvette is readying to sail out from GRSE's fitting-out jetty in Kolkata to join the Navy's eastern fleet at Vishakhapatnam in July, officials said.

The sophisticated front line warship with stealth features will also be the first warship armed with the new trainable chaff launcher — Kavach.

With an approximate displacement of 3400 tonnes, it can achieve a maximum speed of 25 knots. It is powered by four indigenously designed 3888KW diesel engines at 1050 rpm and can cover nearly 3,500 nautical miles at 18 knots. The overall length of the ship is 109 meters and is nearly 13 metres wide at its maximum bulge.

With about 90 per cent of the ship being indigenous, it is also capable of deploying a helicopter, adding considerable punch to the ship's antisubmarine capability.

Times of india

Defence modernisation: The long road ahead

On September 15, 2013 an Agni V ICBM (Intercontinental Ballistic Missile) took off from the Wheeler Island in Odisha. The missile travelled almost 5000 kilometres towards the South before splashing down into the Indian Ocean near Australia. The launch took place with copybook precision and put India in the league of countries that had mastered the crucial ICBM capability. The missile will undergo a few more tests before being inducted into the Indian armed forces. The second test of Agni V led to a new debate in American and Chinese strategic circles about India’s growing ICBM capability. The Agni V test came as a morale booster for Indians at a time when Pakistani troops have been repeatedly violating the ceasefire along the LoC in Jammu and Kashmir and the adventurist Chinese troops have been making frequent intrusions into the Indian territory in Ladakh.
The political innings of UPA-2 has now ended. But when one looks back at former prime minister Dr Manmohan Singh’s legacy, one may easily find that he has been a dove throughout his entire political career. On July 9, 2006 the Agni III IRBM (Intermediate Range Ballistic Missile) was tested by the UPA-1 regime at a time when the global media’s attention was focussed on North Korea’s “provocative” missile tests. The failed maiden test of Agni III was followed by successive successful tests of the same missile. The Agni III’s legacy was taken forward by the Agni IV and the Agni V missiles. After the maiden test flight of Agni V on April 19, 2012, a section of the Chinese media speculated that the real range of Agni V is 8000 kilometres and that the Indian government had deliberately downplayed the vehicle’s range under Western pressure. The Indian government again played dove by reiterating that the missile’s range is around 5000 kilometres.


At a time when the ambitious IGMDP (Integrated Guided Missile Development Program) is yielding significant results, the morale of our countrymen is being degraded by repeated incursions by Chinese troops in the Chumar area of Ladakh. While China has built a well connected network of highways and railways over the last three decades, the erstwhille UPA-2 government has just sanctioned the raising of a dedicated mountain strike corps and the operationalisation of a few Advanced Landing Grounds (ALGs) in Leh, Ladakh and the Northeast in recent years. The Chinese have reportedly stationed their air defence units and mobile ballistic missile launchers and have also set up their air bases (with night landing capabilities) along with forward operating bases in the entire Tibetan plateau which pose a direct threat to Indian forces positioned near the LAC (Line of Actual Control).

On the Indian side there is a lack of motorable roads which will definitely hamper our capability to deploy mechanised infantry units, 135 mm and 155 mm self propelled artillery systems and truck mounted cruise missile batteries during a possible future war with the Communist giant. When one looks back at the resources available with the Indian armed forces stationed in the area, one may find that the country lacks effective air defence systems on the lines of Russian-made S 300 systems deployed by China. The nation`s military capabilities have also been hampered due to the lack of laser guided, satellite guided and radar guided artillery shells. The absence of 155 mm howitzers also cripples the Indian Army’s much required firepower.

The last time when the country witnessed the use of precision guided munition was during the Kargil War when the Indian Army fired Russian made Krasnopol laser guided artillery shells to cleanse the Kargil heights of Pakistani intruders. The indigenous 155 mm howitzer (India Field Gun) project is yet to see the light of the day whereas the LCA (Light Combat Aircraft) - Tejas is also yet to make its maiden flight with the indigenous turbofan (Kaveri) installed on it. Again, the government is yet to float a global tender for acquiring 100,000 automatic assault rifles for the Indian Army.

On the other hand when one looks at the dilapidated condition of the Indian Navy, one finds that the design of the proposed second indigenous aircraft carrier hasn’t yet been finalised while the navy lacks a credible underwater based second strike capability. This at a time when a huge fleet of Chinese nuclear submarines poses a direct threat to our military and civilian ports in the event of an armed confrontation.

Recent reports highlighted the fact that the Indian Army and special operations troops urgently require helmet mounted night vision goggles, Level 5 bullet proof Kevlar vests, thermal imagers, satellite navigation equipments (SatNavs) and hand held laser designators (for guiding laser guided artillery shells to targets). Former defence minister AK Antony had been very reluctant to meet and modernise the basic requirements of our armed forces. Rather than looking into this matter with a serious note of concern, he only managed to blacklist a number of foreign OEMs (Original Equipmnent Manufacturers) which sounds quite strange. It looks like the defence minister may have been more concerned about saving his own image as an honest politician rather than taking bold decisions in national interest. A decade of inaction by the erstwhille UPA government has left the armed forces in a very sorry state.Though the possibility of a new India-China military confrontation is slim, India should develop the technological capability to fight with a hostile and mighty army in the Northeast in the very uncertain near future. In the eventuality of a full blown assault by our Communist neighbour, we will require the capability to deter the enemy from overrunning our Forward Operating Bases (FOBs) at the LAC. The outdated Russian made Igla MANPADS (Man Portable Air Defence Systems), automatic assault rifles/sub machine guns (SMGs) with telescopic vision and the lack of shoulder mounted anti tank guided missiles with the Indian Army will badly hamper our capability to cause significant damage to intruding hostile forces in the Northeast. One has to take note of the ground reality that the country also lacks hypersonic Theatre Ranged Ballistic Missiles (TBMs) on the lines of the Russian `Iskander` systems to neutralise Chinese TEL BMD (Ballistic Missile Defence) and AAD (Advanced Air Defence) batteries installed in Tibet. The Indo-Russian BrahMos 2 hypersonic cruise missile project is yet to see the light of the day.

When one looks at the country`s strategic capability to intercept hostile spy satellites, one may find that we lack an effective surface launched/air launched capability to shoot down enemy satellites in the low earth/medium earth orbit. Despite the fact that the country aspires to be a 21st century power, India is yet to demonstate and deploy an effective ASAT (Anti-Satellite weapon) capability. In the eventuality of a nuclear/thermonuclear exchange with China, the first six hours of the war will be very crucial as the country will need to neutralise the enemy`s radar units, air defence batteries, artillery positions, mechanised columns, TELs (Transporter Erector Launchers) and air bases with cross border surgical strikes and simultaneously blind the enemy`s reconnaissance satellite coverage over the Indian peninsula. This must be done with copybook precision during the first six hours of the war to effectively degrade and destroy (if not obliterate) the Communist rhetoric in Beijing.

Taking into consideration India`s superpower ambitions, one must emphasise that the country needs to increase its ICBMs` ranges and potentially develop a global strike capability. This will be possible if the newly elected government in New Delhi takes bold decision of sanctioning the long pending Agni-VI and Surya ICBM projects. At a time when defence analysts are talking about such futuristic projects, a lot of ambiguity remains about India`s thermonuclear deterrence capability. Recent reports quoting DRDO official K Santhanam suggest that India is yet to weaponise the 200 kiloton theromonuclear design detonated in Pokhran in 1998 and that the Shakti 1 test was a fizzle. If the need arises the country should opt for one more round of nuclear test detonations (Pokhran 3) and master the Hydrogen bomb (thermonuclear device) technology in the next few years before effectively miniaturising and weaponising the design to fit atop Agni V, Agni VI and Surya missiles. On the mere basis of rationalism, the country should confidently sign and endorse the CTBT (Comprehensive Test Ban Treaty) after successfully concluding Pokhran 3.


At a time when the global geopolitical equations are changing at a fast pace, the country needs to deter all potentially hostile nations from eating into its diplomatic weight either by military or by economic means. In a May 19, 1999 article published by The Hindustan Times, reknowned strategic expert Brahma Chellaney clearly raises the need for India to develop a global strike ICBM capability. He clearly states that India needs to develop the capability to hit Western and American cities if a NATO-Kosovo/Serbia like flare up ever takes place over the Indian peninsula. On the other hand, the Indian Air Force urgently needs to raise squadrons of radar-evading fifth generation fighter jets to effectively deliver strikes on hostile bases in the region, while a number of Carrier Battle Groups (CBGs) are required to support it.

At a time when the country has witnessed a historic political transformation and it aspires to be a superpower, the new government in New Delhi must go that extra mile in rapidly modernising the nation`s military infrastructure on a massive scale. Recently, the incumbent NDA-2 government proposed to raise the FDI cap in defence hardware manufacturing to 100% which is a step in the right direction.

Lastly, we must not forget that our motherland is bordered by an Islamic terrorist sponsoring state in the West and a communist giant in the Northeast. It is important for us to secure our land and sea borders in all fronts so that we can peacefully sleep in our bedrooms with a sense of fulfilment. A bold step in the right direction by the new Narendra Modi government at the Centre will provide the much needed impetus to the ambitious defence modernisation program of the nation. The buck has now been passed to the NDA-2 government.

- Zee news

M-777 ultra light howitzers too expensive, India might drop plans to buy

The long-pending $885 million deal with the US government for 145 ultra-light howitzers is headed for a dead-end, with the Indian defence establishment feeling the artillery guns are way too expensive to buy for the new Army divisions being raised for the border with China.

Defence ministry sources on Monday said though no final decision has been taken as yet, there was "no way" the American M-777 ultra-light howitzers could be bought for over Rs 30 crore apiece.

Moreover, artillery manufacturer BAE Systems has "failed to come with a viable and compliant offsets package'' in what is supposed to be a government-to-government deal under the US foreign military sales (FMS) programme.

"Alternatives to the M-777 guns can be found for half the cost. Though in a different class, the indigenous Dhanush howitzer for instance is being manufactured at a cost of Rs 14 crore per gun," said a source.

Like many other big-ticket defence projects, even the proposed M-777 deal has witnessed its own share of controversies, with huge cost escalations, "leaking" of classified field evaluation reports and allegations of irregularities against a top military officer.

The Army has been demanding 155mm/39-calibre light-weight howitzers, with a strike range over 25-km range, for around a decade now. Guns like the M-777, partly made of titanium, can be swiftly air-lifted to "threatened high-altitude areas" along the 4,057-km Line of Actual Control (LAC).

China, of course, has built massive infrastructure along the LAC, which allows it to swiftly mobilize troops and equipment to outnumber Indian forces by 3:1 there. The howitzer project, among others, is meant to equip the new XVII Mountain Strike Corps (90,000 troops) being raised to gain "quick reaction force capabilities" against China.

"Our border infrastructure is also coming up, albeit slowly. There are more options to take heavier artillery guns to forward areas now," said the source.

The Defence Acquisitions Council (DAC), led by the defence minister, had in June 2006 formally given the go-ahead for acquiring 145 ultra-light howitzers from abroad. But the frontrunner, the Pegasus gun of Singapore Technology Kinetic's, was ejected after the firm was blacklisted in the corruption scandal against former Ordnance Factory Board chairman Sudipto Ghosh.

India then went in for the M-777 howitzers under the FMS programme, which does not involve an open competition. The US Defence Security Cooperation Agency in January 2010 notified its Congress of the Obama administration's intention to sell the 145 M-777 guns to India for $647 million ( Rs 3,882 crore). The US offer was renewed in August 2013 with the new project cost being pegged at $885 million (Rs 5,310 crore).

Critical Projects:

* Almost $20 billion MMRCA (medium multi-role combat aircraft) project to acquire 126 fighters. French Rafale jet won selection process, which began in August 2007, but project yet to be inked. IAF down to just 34 fighter squadrons.

* Over Rs 50,000-crore acquisition of six new-generation stealth submarines, with both land-attack missile capabilities and air-independent propulsion (AIP). Project-75India approved in November 2007 but global tender yet to be issued. Navy down to just nine operational diesel-electric submarines at present, with another four stuck in long refits.

* Over Rs 3,000-crore acquisition of 197 new light-utility helicopters for IAF and Army. Project already scrapped once in December 2007. 440 such helicopters needed to replace virtually obsolete Cheetah/Chetak fleets.

* Over Rs 30,000 crore artillery modernization plan for 145 ultra-light howitzers, 1,580 towed guns, 814 mounted guns, 100 tracked self-propelled guns, 180 wheeled self-propelled guns etc. India has not inducted a single 155mm artillery gun since the Bofors scandal of the mid-1980s.

- Defence news

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Centre rushes to buy new submarine batteries as Navy suffers shortage

The government has woken up to the harsh reality of military equipment shortages, and has duly set the ball rolling to replenish the Navy's diminishing submarine battery reserves.

The shortage of submarine batteries hit the nation hard in February, when a fire on board INS Sindhuratna led to the death of two officers.

Though the fire was caused by faulty cables, the accident brought into focus the critical shortage of submarine batteries.

The new government, eager to speed up the procurement of batteries, has invited bids from manufacturers.

The Navy intends to buy seven sets of type-I batteries - comprising 1,736 batteries - for Russian-made Kilo-class submarines.

Another two sets of type-II batteries are being ordered for the German-made Shishumar-class submarines. The two sets will have 1,080 batteries.

Sources said the purchases are meant to replenish reserves and overcome the shortage. The procurement of submarine batteries was hit hard by red tape as the Defence Ministry had stopped purchases from a particular vendor.

The issue remained embroiled in bureaucratic cobwebs and litigation between competing companies, resulting in a shortage of batteries for the navy.

With the new government putting major emphasis on defence modernisation, the purchase of batteries is expected to be smooth.

Two major submarine accidents within a span of six months have rattled the Navy. The incidents not only caused the death of Navy personnel, but also rendered two operational Kilo-class submarines out of service and severely impacted force levels.

INS Sindhurakshak, a Kilo-class submarine which sank after explosions killed 19 personnel on board in August last year, is in the process of being retrieved, while INS Sindhuratna needs new cables to become operational once again.

The fire on board Sindhuratna in February also resulted in several sailors being hospitalised during sea trials.

Sources said new cables are being procured as all efforts are being made to make the submarine operational again.

The revival of the two vessels is crucial as the navy is critically short of submarines.

The new line of French Scorpene submarines is not expected to be delivered before early 2016, the fresh deadline fixed for the much delayed project. 

 dailymail

India’s Defense Preparedness on Top Gear

Prime Minister Narendra Modi became the first leader to sail on INS Vikramaditya and dedicate it to the nation. During his planned tour in mid June, Prime Minister sailed for few hours on board of the giant warship and saw its capabilities.

This was a symbolic trip that connoted India’s defence preparedness on top gear and also boosted the sagging morale of Indian Navy that has been struck by string of accidents.

Modi's planned visit to INS Vikramaditya also signifies ties with Russia that has seen many ups and downs. INS Vikramaditya is Russia’s Kiev class Admiral Gorshkov which has been casting the dark shadow on the bilateral relations.

In its new avatar as INS Vikramaditya, the 22-storey high aircraft carrier weighing 44 thousand tons with the deck of the size of three football fields has become the largest warship of the Indian Navy.

The Indian Navy also accumulated a great experience in global operations when INS Vikramaditya sailed non-stop from Russia to India last December. According to some experts it was the largest warship ever exported by any country in the world.

The other good news for Indian Navy is the first Scorpene submarine will be ready by Sept 2016. The construction of French-origin Scorpene submarines at Mazagon Dock is progressing well and the first submarine is scheduled to be delivered by September, 2016.

Separately, Indian Navy can expect a full service centre for its fleet of MiG-29Ks by next year. As part of contract provisions, RAC-MiG signed offset agreements with Indian private firm Basant Aerospace worth $55 million including a $12 million deal for a service center dedicated to repair of equipment for the upgraded MiG-29K in India.

The deals include warehouses and an uninterrupted supply chain of spare parts. The Indian Navy received seven more MiG-29K/KUB jets in 2013 towards a total fleet on order of 45 aircraft based out of Goa's INS Hansa naval air station.

The upgrade kits for the first six MiG-29K fighters had been handed over to the Indian Navy for on-site upgradation at Goa as part of a deal signed in 2009.

The other aircraft will be upgraded locally under transferred technology as part of the original contract. Upgradation of the first six aircraft has already begun and its making steady progress

In the meantime, Indian Navy and Republic of Singapore Navy (RSN) conducted annual bilateral naval exercises named SIMBEX 2014 in Andaman Sea. The 21st series of SIMBEX hosted by India was conducted from 22 May to 28 May 2014.

SIMBEX 14 was designed to enhance inter-operability and mutual understanding between the navies of the two nations. The Two nations started bilateral naval cooperation in 1994, the year when RSN ships began training in Anti-Submarine Warfare (ASW) with the Indian Navy.

Since then, the SIMBEX has grown in tactical and operational complexity. It has transcended the traditional emphasis on Anti-Submarine Warfare (ASW) to more complex, maritime exercises of naval operations like; Air Defence, Air and Surface practice firing, Maritime Security and Search and Rescue Operations.

If Indian Navy has added some feathers to its cap, the Indian Air Force (IAF) is not far behind. IAF too has been in reckoning, as it successfully conducted tests to launch India’s indigenously-developed surface-to-air missile Akash. IAF will be the first service to induct the Akash missiles in their inventory.

Akash is a medium range surface-to-air anti-aircraft defence system developed by DRDO. It has the capability to carry warhead of 60 kgs. The missile has the capability to target aircraft up to 30 km away and is packed with a battery that can track and attack several targets simultaneously.

During the trial Akash Missile aimed at a para-barrel target. The missiles were launched on tow body target of Lakshya (pilotless target aircraft) moving at low altitude far boundary, and ripple mode missions. The missiles intercepted the fast moving and maneuvering small RCS targets within small interval of five seconds in ripple mode.

Close on the heels of Akash tests, the IAF also successfully test fired, first indigenously developed air-to-air missile Astra on 4 May 2014. This was done so from a Sukhoi-30MKI fighter jet over the Arabian Sea off Goa. The 60-km plus range missile possesses high Single Shot Kill Probability (SSKP) which makes it highly reliable.

Astra is India's first Beyond Visual Range (BVR) Air-to-Air missile. It was designed and developed indigenously by the DRDO. Astra is an all-weather missile with active radar terminal guidance. Astra is a highly advanced state of the art missile with excellent ECCM (electronic counter-counter measures) features, smokeless propulsion and process improved effectiveness in multi-target scenario.

Astra is to initially have a 44-km range with high single-shot kill probability. The project was first sanctioned in March 2004 at an initial cost of 955 crore rupees.

The current version of the Astra will be followed by a longer-range Astra Mark II, which can be launched at enemy fighters 80 km away. The Mark II, will have a state-of-the-art ring-laser gyro, is expected to be flight tested at the end of 2014.

India becomes the fifth country to have BVR missile. Only a few countries like the US, Russia, France and Israel have managed to develop BVR missiles till now. Once fully operational, Astra will be much cheaper than contemporary BVR missiles.

India’s defence preparedness has got a shot in its arms in yet another significant development when Bangalore based Electronics and Radar Development Establishment (LRDE) announced to acquire a Dornier 228 light-weight aircraft for its own testing of radar in air.

Named ‘Nabhrathna’, the aircraft signify a jewel in the sky.

State-run aerospace firm Hindustan Aeronautics Limited (HAL) on 1 May 2014 handed over the DO- 228 aircraft to the DRDO for further upgradation. The aircraft is to be equipped with indigenous synthetic Aperture Radar and state-of-the-art avionics and communication system. HAL had signed the contract for Nabhratna Flying test bird aircraft in May 2013 and completed the project in May 2014, six months before schedule time of November 2014.

The significance of Nabhratna is whenever LRDE needed to test any radar under development; they had to approach Indian Navy or Indian Coast Guard for loan allotment of DO-228 aircraft for limited period. As it was difficult to spare the aircraft because of operational needs that resulted in delay in the development of radars, the LRDE decided to procure one DO-228 aircraft for its own testing of radar in air. The aircraft will be used by LRDE as flying test bed (FTB) for evaluation of performance of various radars being developed by LRDE.

India’s defense preparedness has acquired top priority from the incumbent Prime Minister. His visit to INS Vikramaditya has sent this profound message. Over all India’s defence preparedness seems to be on top gear.

Defence news

Tatas aim to build aircraft for Ruag Aviation

The Tata Group today said it aims to bring out a fully built aircraft for Ruag Aviation - makers of Dornier 228 new generation aircraft, parts of which are to be made in India by TASL.

Tata Advanced Systems Ltd held ground breaking ceremony here for manufacturing Dornier 228 fuselage and wings.

The Tata-Ruag partnership is a glowing example of cooperation between India and Europe, TASL Chairman S Ramadorai said.

"It is our belief that this project is a significant step forward in India's growth as a high technology, precision, manufacturing destination. Ruag has entrusted the Tatas to deliver its showcase product, the Dornier 228, at world-class standards of precision and quality," he said.

"Our vision is to work with Ruag in having a full aircraft, equipped with systems flying out from a Tata final assembly. This will be of significant importance to the Indian Armed forces in their desire to produce products locally," he said at the function.

Within five years, TASL has become a significant player in the Global Aerospace market by delivering successfully over 70 Sikorsky S-92 cabins, and delivered Empennage and Center Wing Box for the C-130 J aircraft through its separate JV with Lockheed Martin, Ramadorai said.

It has also made Hyderabad a premier manufacturing destination for Global OEMs, he added.

The Ruag project is the fourth Aerostructures unit to be set up by TASL since 2009 in Hyderabad and the products of all the units are 100 per cent exported.

Telangana Chief Minister K Chandrasekhar Rao, chief guest of the function, said the government will soon announce new industrial policy and consultations with stakeholders are underway.

"The goal is to make the Made in Telangana label as a globally recognised brand for its quality and innovativeness," Rao said.

The city -- host to many research and development bodies such as DRDO, DRDL, Midhani and BDL -- is ideal for setting up aerospace industries, he said.

- Defence news