Monday, February 18, 2008

Defence Expo 2008.. Spawing MilBus in India...

The ongoing Fifth International Land & Naval Exhibition system, DEFEXPO 2008 at Pragati Maidan, New Delhi has generated lot of heat & flutter among the aspirant buyers & dealers of arms & armaments.
475 defence manufacturers, 30 countries, 32,000 square meters area, staggering launch of 91 new products ranging from radars, to communications systems, torpedoes, anti-mine vehicles and unmanned aerial vehicles is bound to turn lot of heads towards India. RIA Novosti reports that with India arms spending, around $30 billion on arms spend in 2007, has acquired global dimensions. Indian private sector is vying for atleast 30% of that pie which would amount to $10 billion which is India expects, the public sector won't be able to absorb. India's spend on arms will be around 2.5% of the GDP which is huge amount considering India being 4th largest economy in the world.
A great number of collaborations & negotiations between Indian companies & foreign defence equipment manufacturers have also been anounced. some of those notably are
  1. TATA Advanced Systems (India) sign MOU with Israeli Aerospace Industries to manufacture and develop missiles, pilotless aircrafts, electronic warfare systems, radars and other security systems and defence equipments.
  2. TATA has also tied up with European Defence and Aerospace Consortium for developing advanced tactical communications system project for Indian Army.
  3. TATA also made a contract with US based Sikorsky Aircraft Corporation for manufacturing cabins for Sikorsky’s S-92 helicopters.
  4. TATA also made a joint venture of the company with American aircraft major, Boeing, which is touted as the largest deal of the EXPO.
  5. Mahindra Defence Systems (MDS), a part of the Mahindra & Mahindra Group, is in advanced negotiations for a strategic alliance with Whitehead Alenia Sistemi Subacquei (WASS). The proposed underwater defence JV with WASS will jointly address the Indian requirement for underwater defence bringing to the country's armed forces affordable world-class underwater defence systems.
  6. European naval defence systems major DCNS Group announced that it would set up its Indian subsidiary to facilitate ongoing and future projects.
  7. DCNS has recently signed agreements with Kirloskar Oil Engines for integrated platform management systems and with Walchandnagar Industries Ltd. propulsion system parts for the next generation ASW (anti-submarine warfare) corvettes being built for the Indian Navy.

There is still a day remaining & lot of exuberance is still being showcased. This binneial event is touted to be largest of its kind. China has remained away from the EXPO while Pakistan was invited to it.

This EXPO has created lot of exuberance in the Indian Private sector to grab a slice of the Indian Defence market. This will naturally aid to the MilBus(Military Business nexus) in India. Indian defence minister also announced that midllemen will be completely eliminated & has also trying to reduce lot of procedural hiccups while sourcing defence deals.

Indian Goverment does not place orders with the private sector company which does not have less than 26% equity owned by foreign collaborators. It is expected that this norm may be relaxed, which will definitely provide a huge boost to the industry here...

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