More FDI must flow in defence sector: Tatas

The Tata Group of companies pitched hard to propel Prime Minister Mr. Narendra Modi’s ‘Make in India’ dream a reality through increased flow of investments into the domestic defence sector. Mr. Mukund Rajan, a key face in the group told media ahead of Aero India 2015 the flow of foreign direct investment (FDI) into domestic defence sector has been very meagre in the last 15 years. “It is startling how little FDI has come into India in the past 15 years. A mere $4.94 million has come as FDI in the defence and aerospace sector in India since 2000,” Mr. Rajan said. The Tata group has already made inroads in some of the critical aerospace and defence programmes in the country. He said the group’s current order book position aerospace and defence sector is Rs 10,000 crore-plus. As reported by OneIndia earlier, the company is the lone bidder for the Avro replacement programme, which is now stuck at the Defence Acquisition Council level. Hindustan Aeronautics Ltd (HAL) had launched an open campaign against the government decision to keep them out of the fray. The tender had sought foreign OEMs (Original Equipment Manufacturers) to identify an Indian partner other than HAL, to supply 16 aircraft from their original facilities and provide ToT (Transfer of Technology) for manufacturing the remaining 40 aircraft by the Indian partner. As per the tender, foreign OEM would remain as the main contractor and the Indian partner would only remain as a vendor. The Tata-Airbus consortium (Airbus Defence & Space and Tata Advanced Systems) has offered the Airbus C-295 as a replacement to the Avros. The project is worth Rs 13,000 crore.

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