31 December 2015

PSU beats Anil's Defence

New Delhi, Dec. 29: In Prime Minister Narendra Modi's showpiece "Make in India" project to be opened this Sunday, a public sector firm has beaten Anil Ambani's Reliance Defence that was lobbying to make Russian helicopters.
Moscow announced last night that the Russian state arms export agency, Rosoboronexport, and the chopper-maker, Rostec, have chosen the Indian defence undertaking Hindustan Aeronautics Ltd (HAL) to make the Kamov 226t "Sergei" light utility helicopters for the military.

India's army and air force have a requirement of 200 such reconnaissance and surveillance helicopters immediately to replace the Cheetah and Chetak machines that currently undertake the task. The initial order is estimated to be worth $1 billion.
Most of the Cheetah and Chetak helicopters are more than 40 years old and have a high rate of accidents. Earlier this year, the wives and widows of military officers who fly/have flown the Cheetahs and Chetaks urged the government to replace them.

The total order for Sergeis could go up to 400 with the navy also projecting the requirement.
The process of replacement has taken more than 10 years. The Prime Minister, who returned from Russia last week, is scheduled to lay the foundation stone of a HAL facility to make helicopters at Tumkur, 100km from Bangalore, this Sunday.

"The agreement with India is the result of the long work with our Indian partners," the CEO of Rostec, Sergei Chemezov, said in a statement distributed by Russian news agencies.

An Indian government source said "the Russians chose HAL".

Ambani's Reliance Defence has announced plans to make fighter planes, warships and submarines for India's military. Ambani was part of a delegation of corporate leaders who were in Moscow last week during Modi's visit.

Foreign ministry spokesperson Vikas Swarup tweeted during the Moscow visit that this would be the first "Make in India" project.

The Russian statement said: "This is the first Russian-Indian high-tech project, implemented by the Indian government within the framework of the 'Make in India' programme."

In choosing HAL, the Russians have selected the only company in the country that can show infrastructure and partnership experience to build aircraft. HAL has been partnering with Russia to build aircraft for decades from Russian semi and completely knocked-down kits. It is currently turning out Sukhoi fighter aircraft for a price that is considerably higher than their off-the-shelf cost, government auditors have pointed out.

The defence ministry has in the past thrice scrapped a global tender for light utility helicopters on charges of corruption. In May this year, the Defence Acquisitions Council chaired by Manohar Parrikar accepted the necessity of acquiring the Sergeis for the armed forces.

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