BEL for Offsets Business

Bharat Electronics Limited plans to diversify its portfolio with 70% focus on the defence sector and 30% on civil sectors , including homeland security, infrastructure and e-governance. As per its CMD, "BEL is taking proactive steps to protect and further consolidate its leadership position in the Indian Defence Sector while accelerating efforts to get into new business areas".

The company had appointed KPMG consulting firm to identify new growth opportunities. BEL was looking at avenues like energy efficiency solutions, nuclear power instrumentation and was in discussion with reputed foreign and Indian players for forming joint ventures in areas of defence electronics. It was exploring joint venture opportunities in the field of missile electronics and guidance system, microwave super components and airborne EWs. Some of these proposals are in the advanced stages of finalisation.

MoUs are in place with Hyderabad-based firm M/S Astra Microwave Products Limited for microwave components; with Boeing to jointly develop an Analysis and Experimentation Centre in India to offer customers the ability to make better informed decisions on modernising the country's defence forces; with SELEX Galilieo. MoU has also been signed to explore formation of joint venture for solar photovaltic business.

BEL has been selected as offset business partner by multinational companies like Boeing, Lockheed Martin and Northrop Grumman.

Brigadier (Retired) Sukhwindar Singh
http://www.svipja.com/
(A Global e-Solution for Offsets)
Credit: Business Standard

FDI in A & D Sector

FDI in sensitive and strategic sectors like A & D has always been a point of debate the world over. National interests are considered paramount in such decisions with views of other stakeholders happily considered /meshed .

India permits only 26% FDI in the A & D Sector as of now. It would purchase 'sensitive' technologies, if needed, on down payment. Reasons for these policy decisions are NOT very difficult to fathom. And also its Defence Offset Policy, called restrictive by many, is India focused to meet the declared objectives.

Control, Ability of Indian Corporates and GoI to Invest in the Strategic Industry, Hostile Takeover(s), Strategic Imperatives, Technology Issues / Implications, In-house Capabilities, etc, are some of the factors that dictate the policy parameters.

An Article by Mr Julian Scopes, President BAE Systems, India, FDI in India's Defence and Security Sector, presents the Industry concerns on the issue of FDI and TT. Explains concerns of major stakeholders who wish to be part of India's strategic initiatives. Link: http://www.freemarketsdefence.com/show_content.asp?cid=29 to read the full Article.

Needs an open debate.

Brigadier (Retired) Sukhwindar Singh
http://www.svipja.com/
(A Global e-Solution for Offsets)

Credit: The Economic Times

India's Private Defence Sector Will Not be Affected by Economic Downturn

The growth of India's private defence sector is unlikely to be affected by the global economic slowdown, a director of the Federation of Indian Chambers of Commerce and Industry (FICCI) has said.

Speaking to Jane's on 21 April, Vivek Pandit said the most influential factor in the country's private sector, which has been allowed to manufacture defence equipment since 2001, would be the Indian general election that commenced on 16 April and is scheduled to end a month later.

"India's private sector is broadly insulated from the economic crisis and is certainly less affected than other countries," said Pandit, who is responsible for defence industry matters within the FICCI.

"India is forecast to grow at 6.5 to 7 per cent this year, which is a slowdown from the previous 8 per cent growth, so you will see some private defence companies having to reallocate resources and become efficient, although the impact will not be major."

The private defence sector in India currently receives about 9 per cent of the country's total USD7.3 billion procurement budget, or around USD700 million.

About 21 per cent of this budget is spent on procuring capabilities from the state-owned public sector undertakings (PSUs) - such as Bharat Electronics Limited and Hindustan Aeronautics Limited - with the remaining 70 per cent being awarded to overseas vendors.

Brigadier (Retired) Sukhwindar Singh
http://www.svipja.com/
Credit: http://www.janes.com/