In a major push to the private Indian defence sector, Indian based Reliance Group has entered into a Joint Venture with the French aviation giant – Dassault Aviation. The JV designated ‘Dassault-Reliance Aerospace’ was brought to existence today and is expected to hurl a new chapter in the Indian aerospace industry.
Eric Tappier, Chairman and CEO Dassault Aviation, speaking about the JV said “The formation of this Joint Venture with Reliance Aerospace led by Anil Ambani illustrates our strong commitment to establish ourselves in India to develop strategic industrial partnership under the Make in India policy promoted by the Indian Government”
The JV comes days after India and France signed a multi-billion deal for the capable Rafale aircraft. The Rs 60,000 crore deal comes with a demanding 50% off-set clause. Global defence firms have been on the lookout for strategic partners to enter the lucrative Indian defence market.
Reliance Group led by Anil Ambani entered the defence market in January 2015 and has shown interest in locally producing aerospace solutions, artillery systems, ship building and submarine construction. The company has already made sizable investments in the defence sector.
Anil Ambani, Chairman Reliance Group said “We are delighted to partner a world leader in aviation like Dassault Aviation. This is a transformational moment for the Indian aerospace sector and Reliance Infrastructure’s subsidiary Reliance Aerospace.”
The Indian Air Force (IAF) under the €7.87 billion deal will acquire 36 Rafale aircraft. In lieu with the deal, Dassault is now expected to invest over Rs 22,000 crore in the Indian market. The company with its investment expects to boost the maturing aerospace environment of India.
The JV now created will serve as an effective tool to execute the demanding offset clauses. Dassault feels the JV will also greatly support ‘Make in India’ and ‘Skill India’ initiatives of the NDA-led Indian government.
The off-set clauses themselves have to be executed under the IDDM (Indigenously Design, Develop and Manufacture) program. The technology thus brought to the nation is expected to boost the capabilities of the Indian aerospace sector.
Safaran, the engine providers for the Rafale aircraft, have in the past offered to help India develop aero-engines. India’s GTRE has greatly struggled in designing and developing the Kaveri engines for the indigenously built Tejas aircraft. Offers from the likes of Safaran promise to boost India’s defence manufacturing capabilities.
MBDA, which is the armament provider for the Rafale aircraft has also offered to set-up joint manufacturing bases. Thales Aerospace, a leader in aviation solutions, hopes to set-up Research and Development (R&D) centres in the country. JV’s like these promise to set-up investment platforms for the companies and to pave the way for technological growth in India.
The JV will now form the epicentre of the Reliance and Dassault working group. Dassault Aviation has its sight firmly set on the soon to be finalized tender for supplying 90 MMRC aircraft for the IAF. Competition remains stiff with Boeing pitching its ever capable F18 Super Hornet and Saab trying to wield the magical ‘Transfer of Technology’ wand.
© Karthik Kakoor