nil Ambani-led Reliance Defence Ltd signed a deal with Israel’s Rafael Advanced Defence Systems Ltd to set up a joint venture company in India. They will be venturing into the highly specialised areas of air-to-air missiles, air defence systems and large aerostats, and will oversee projects worth $10 billion (over Rs 65,000 crore) in 10 years.
The project will have an initial capital outlay of more than Rs1,300 crore, excluding the cost of technology. Reliance Defence will have 51 per cent holding in the venture and Rafael 49 per cent, going by the guidelines issued by the government.
“The strategic partnership with technology power house and one of the world leaders in defence technologies, Rafael Advance Defence Systems, will mark the entry of Reliance Defence in the complex field of air-to-air and air defence systems manufacturing in India,” said a company statement. The joint venture will give a big boost to the field of indigenous production and development of high precision and state-of-the-art weapon systems in India.
Job creation
The new venture will be located at Dhirubhai Ambani Land Systems Park at Indore, Madhya Pradesh, and will generate more than 3,000 highly-skilled jobs.
Rafael has products such as Python and Derby in the air-to-air missiles system, Spyder range in air defence systems, and the Barak missiles family of surface-to-air missiles in the short- and medium-range. Rafael has already provided large aerostat systems to the Indian Air Force for meeting its surveillance, reconnaissance, communication and intelligence needs. The two companies will offer the entire range of products in these fields to the Indian Armed Forces.
“Rafael is also willing to offer solutions through the joint venture even for the ongoing ‘buy global’ programmes where it is currently competing, in line with ‘Make in India’ initiatives, of the Indian Government,” the statement said.
‘Growth opportunity’
On November 4, 2015, the Reliance Infrastructure board said new high-growth opportunities in the defence sector, arising from the ‘Make in India’ and ‘Skill India’ policies, serve vital national priorities and have several attractive features. Reliance Defence has industrial licences for the full spectrum of military platforms and is the fastest emerging private sector enterprise in the development, manufacture and supply of defence aerospace, land and naval platforms and equipment.
The pact will give a boost to indigenous production and development of state-of-the-art weapon systems
