Govt clears plans to ramp up production of indigenous fighter jets Tejas

Source: Business Standard, Feb 15, 2017

India will open a second production line for its light combat aircraft, Defence Minister Manohar Parrikar said on Tuesday, pressing ahead with a home-grown plane the military has had doubts over for years.The Tejas fighter entered service last year, 33 years after it was approved as the country sought to build a modern fighter from scratch for an air force that was entirely dependent on foreign – mostly Soviet-origin – aircraft.

But the single-engine plane remains dogged by production delays at state-run Hindustan Aeronautics and only three have so far entered the air force.

Parrikar said the government had just approved an investment of Rs 136 crore ($203.47 million) for HAL to lay a second production line to ramp up production of the indigenous fighter.

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Reliance Defence signs warship repair pact with US Navy

Source: IBEF.org, Feb 13, 2017

New Delhi: Reliance Defence and Engineering Ltd. (RDEL) has announced an agreement with the American Navy for repair and alteration services for warships of the largest forward- deployed Seventh Fleet operating in the region which includes Western Pacific and Indian Ocean. At any given time there are roughly 50¬70 ships and submarines, 140 aircraft and approximately 20,000 sailors under its command. Reliance Shipyard at Pipavav in Gujarat was the first shipyard in the country to receive the Master Ship Repair Agreement (MSRA) certification from the US Navy. The contract for an Indian private sector defence company like Reliance is also on the back of a long period of negotiations between India and US, which culminated in the signing of the Logistics Exchange Memorandum of Agreement (LEMOA) between the two countries in August 2016.

Government defends allowing 100 per cent FDI in defence sector

Source: The Economic Times, Jul 27, 2016

NEW DELHI: Defending government’s policy to allow 100 per cent FDI through automatic route in defence and retail sectors, Commerce Minister Nirmala Sitharaman today said “greater the investment, greater the opportunity for employment generation”.

Replying to supplementaries during Question Hour, she said the new FDI policy does not compromise national security, nor does it affect employment opportunities.

“When we say whether it is automatic or through the Government route, all processes for establishing the facts behind this investment and implications of security are duly done and diligences completed,” he said.

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India ‘successfully’ launches ‘Agni-V’ missile

Source: The Hindu Business Line, Apr 18, 2012

India today successfully launched Agni-V, its long-range, nuclear-capable, ballistic missile of 5,000 km from Wheeler Island off the coast of Orissa.

The missile was fired at 8.07 am. It soared 600 km high, reached its destination and the target, according to scientists of the Defence Research and Development Organisation (DRDO), which developed the missile.

Missile power

Describing the launch as a ‘superhit’ and gamechanger, Dr V.K. Saraswat, Chief of DRDO, declared that India is now a missile power. The Agni-V met all its parameters and proved the technological capability.

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India picks French jet over Eurofighter in $10bn deal

Source: BBC News, Jan 31, 2012

Dassault Aviation, as preferred bidder, will now enter final talks before signing a deal that will supply India’s air force with 126 Rafale aircraft.

Correspondents say this is one of the world’s biggest defence deals and is a major setback for rival bidder, the Eurofighter Typhoon.

Eurofighter lost out in December on an $8bn deal to supply jets to Japan.

Shares in Dassault Aviation rocketed more than 20% as the latest news broke.

‘Purely cost’

The Typhoon is built by the German and Spanish branches of European aerospace giant EADS, Britain’s BAE Systems and Italy’s Finmeccanica.

Officials at the British High Commission in Delhi said they were disappointed with the decision and would now study the details.

“It was expressly said this was about the cost of the contract, not a reflection on the health of bilateral relations between India and the countries,” the commission said.

A spokesman for the Eurofighter Typhoon consortium told the BBC they were disappointed, but stressed that the decision was not final and negotiations were still going on.

“However, we respect the decision of the Indian MoD. With the Eurofighter Typhoon, we offered the Indian Air Force the most modern combat aircraft available,” he said.

“Based on the Indian government feedback, we will now carefully analyse and evaluate this situation together with our European partner companies and their respective governments.”

BBC defence and diplomatic correspondent Jonathan Marcus says the Indian air force is going through an unprecedented period of modernisation; a response in part to China’s developing air power.

Four other bidders had dropped out in the lengthy Indian selection process.

He says various reasons were in play in the Indian decision, including diversifying from Russian hardware and contractual problems with other bidders.

French Minister of State for Foreign Trade Pierre Lellouche welcomed the deal, the first foreign order for the Rafale multi-role jet.

He said: “This is good news and France needs good news right now… It is good news for our aerospace industry and for our defence industry.”

Mr Lellouche also complained that “political pressure applied by our competitors does not make things very easy”.

James Hardy, Asia Pacific specialist at IHS Jane’s Defence Weekly, said this was a “big loss for Eurofighter”.

“The Typhoon was widely tipped to be the favourite and had major political support from the big beasts of the Eurofighter nations. Both Germany and the UK invested a lot of time in pushing the Typhoon, so this will hurt.”

Indian Defence Minister AK Antony had earlier cautioned that this remained a “long process” and that no deal would be signed before the end of March.

One Indian defence ministry source confirmed to Reuters that the Rafale had been “much cheaper unit-wise”, adding: “Moreover, the Indian air force, which is well-equipped with French fighters, is favouring the French.”

India is the biggest arms importer among emerging nations.

Govt may allow higher FDI in Defence sector

New Delhi: The Government is inclined to allow an increase in Foreign Direct Investment (FDI) limit beyond the existing 26 per cent in the defence sector on a case-to-case basis.

The Government, however, has reiterated its view that ideally the limit should be only 26 per cent as Defence is a strategic sector.

The views of the Government have been brought out in the Report of the Department related Parliamentary Standing Committee on Defence on ‘Indigenisation of Defence Production-Public Private Partnership which was laid in Parliament on Thursday. The Chairman of the 31-member committee is Mr Satpal Maharaj and its members include the former Prime Minister, Mr H.D. Deve Gowda.

The Parliamentary Committee has expressed the view that the possibility of increasing the FDI limit to 49 per cent in the sector should be examined by the Government after keeping in mind the fact that national interest must reign supreme in Defence-related matters. The Committee report points out that it has given due weight to the benefits that would accrue to the industry and economy as a result of the increased inflow of FDI,

The industry, including the representatives of the Federation of Indian Chambers of Commerce and Industry and the Associated Chambers of Commerce of India, had expressed the view that the present limit of 26 per cent FDI in the sector needed to be enhanced to attract foreign investors.

The Ministry of Defence, however, holds the view that any increase in the FDI level beyond 50 per cent would imply management control with foreign investors and such ventures might fail to deliver at critical junctures due to factors such as sanctions imposed by foreign Governments, among others.

Currently, private sector firms including Mahindra and Mahindra, the Tatas and Samtel are participating in the Defence projects.

Source : The Hindu Business Line.  05/03/10