India, the New Land of Opportunity for Defense Contractors
Traditionally a reliable Russian customer, India is also looking further west for its new fighter and attack aircraft; proposals from the U.S.,...More MiGs For India?
India is currently buying an aircraft carrier from Russia while building its own. It looks like an order for MiG-29 aircraft will be placed to...Boeing Begins Offsets In India
Boeing recently sold the P-8I maritime patrol aircraft to India. This country requires offsets for foriegn companies winning contracts and Boeing...Mahindra Satyam And SAAB To Collaborate On Indian Military Programs
Filed under: Business Line, Companies, Countries, Events, IT, India, Mahindra Satyam, S&T, SAAB, development program, logistics, production program
The Indian IT company Mahindra Satyam has signed a Memorandum of Understanding (MOU) with SAAB to establish a working relationship in India. The agreement means that Satyam will help SAAB develop and market products in India and perhaps to customers outside of that South Asian country. India has recently been looking at changing their laws in order to allow more of these kind of deals.
The first program the two companies will work on will be a Battle Management System (BMS) for India’s ground forces. This will be a SAAB developed and previously deployed system. Satyam will aid in any required changes and provide support to the product. The two companies have set up a joint Center to help market their products and help develop new ones.
This MOU also allows easier penetration of the Indian military and market as the assistance of a domestic company allows more flexibility in the awarding of contracts and work. India and its companies will gain by being exposed to products and the abilities they gain by developing systems and deploying them.
India’s Defense Upgrades Struggle But Continue With Boeing Bidding On Helicopters
India has made major efforts to upgrade their military equipment over the last ten years. Unfortunately they have had their struggles implementing...PKOs examine future challenges
UNITED NATIONS, Oct. 5 (UPI) -- The chief of peacekeeping operations for the United Nations scheduled visits to Pakistan, Bangladesh and India to examine key challenges for the forces.
Lockheed Martin names new head in India
BETHESDA, Md., Aug. 12 (UPI) -- Lockheed Martin authorities announced the appointment of a new chief executive at the company's India-based operations.
New Report On Global Homeland Security Sector
Filed under: Business Line, Companies, Events, IT, Services, logistics, training
Our premier sponsor, ASD Reports, has just released a new report by Visiongain on the Global Homeland Security 2009-2019 sector. This report “examines one of the defence industry’s newest and most promising sectors. Governmental spending on products and services for homeland security should reach $141.6bn worldwide in 2009, our report shows.” Over the last ten years nations across the world have invested heavily in security to prevent terrorist attacks such as those in America, Spain, Great Britain and India.
If you are interested the report may be found here.
Lockheed Accelerates India’s C-130 Aircraft
Filed under: Boeing, Business Line, Companies, Contract Additions, Contract Awards, Countries, Events, India, Lockheed Martin, Military Aviation, logistics, production program
India had purchased six C-130J transports from Lockheed Martin last year. This is part of that nation’s program to improve their armed forces through buying new technology from U.S. , European and Israeli suppliers. Along with the buy of the U.S. transports the Indian Government purchased P-8 Anti-Submarine Warfare (ASW) and patrol aircraft from Boeing. There is also a major fighter contract contest underway that has seen Lockheed bid their F-16 aircraft for as well.
Lockheed announced that they are accelerating the production and delivery of the six aircraft. It is hoped that the first one will be delivered in about two years. The hope is that by showing good performance it might drive India to execute the second buy option in the contract. This is for a further six aircraft. Lockheed is hoping that the new agreement between the two countries allowing U.S. control on technology sold to India will facilitate further deals.
U.S. And India’s Weapon Buying Relationship Moves Forward
Filed under: Boeing, Business Line, Companies, Contract Awards, Countries, Events, India, Military Aviation, Proposal, development program, production program
As part of her diplomatic mission to India Secretary of State Hillary Clinton discussed a new agreement between the countries that will facilitate sales of U.S. weapons. This “end user monitoring” will make it possible for the U.S. to make sure that the Indian government does not sell its technology to a third party or misuse it for their economic gain. This type of agreement is fairly common among countries and allows sales to be made with some confidence.
India has embarked on a major upgrade to its military through acquisition of foriegn sourced weapons. This is a change from the past when the South Asian country tried to develop its own advanced weapons and relied on the U.K. and Russia. The decision to buy American, European and advanced Israeli technology allows India to leap forward in capability. As part of these contracts significant offsets are required of the selling companies through investment in the Indian economy.
European Union Limits Offsets
Offsets are the practice of when one country buys a system or services from a company in another they require that company to invest in their economy. They are not uncommon in the defense business. Right now India especially has very strict offset rules that have led to some controversy.
The European Union announced yesterday some rules to make offsets more targeted and defense related among its member countries. In the past some country’s have requested offset investment in their civil economy rather then in defense work. Normal procedure is to buy services, parts or maintenance related to the contract awarded.
The new rules require that the offsets be defense related. They also limit the total value to no more then equivalent to the awarded contract. Most often offsets are some percentage of the value so these rules are not to onerous. The EU has moved recently to tighten up competition among the various countries penalizing Italy for favoring their own internal industry over other available sources for example.
The offset rules announced will probably have limited effect since many of the projects are already shared among a variety of suppliers such as the Typhoon. If there is a decline in defense spending and the number of large contracts available there will probably be more efforts to expand competition and restrict protectionist policies.
Canadian Government Fights Back on Foriegn Contracts
Filed under: Business Line, Canada, Companies, Contract Awards, Countries, Events, General Dynamics, IT, Thales
The Canadian government of Mr. Harper has received criticism from the domestic defense industry and legislators that it has not been awarding enough contracts to Canadian companies. Part of the issue is that the last two major contracts for C-17 and C-130 aircraft had to go to American companies who are the producers of those aircraft. A more recent award for trucks though went to an American company Navistar when the product was available in Canada. The Vancouver Sun is reporting that the administration is trying to mollify its critics by awarding tow major contracts to Canadian companies. The two new contracts are for upgrades to command and control systems and will be awarded to Canadian subsidiaries of Thales and General Dynamics. Even so the work will be done in Canada and employ Canadians. One of the problems that affects defense contracting, especially for smaller countries, is that it may be hard to do the work domestically. India for example has invested billions into its industry but still has to turn to foreign suppliers for large, complicated programs.
Indian Offset Policy Leads to Israeli Contract
Filed under: Astra Microwave, Contract Awards, ELTA Systems, IT, India, Israel, Military Aviation, production program
Israeli company ELTA Systems placed a contract with Astra Microwave worth about $11 M for components. This is due to the offset provisions in Indian law for foreign firms winning contracts. MarketWatch.com has the press release. Israeli companies won a major contract to provide airborne radar and surveillance aircraft from India recently and this award may be an offset for that contract. Read more
India steadily increases defense spending
Filed under: England, India, Military Aviation, S&T, development program, logistics, production program
The headline on this article in the Daily Telegraph is a little misleading once you read it. India is on a path to more then double defense spending in the next twenty years, where it will be higher then the current UK’s budget. For India to exceed Britain’s budget it would take the UK holding spending steady, and actually adjusted for inflation, reducing it. It is certainly possible to imagine that the UK, and the US for that matter, may have to reduce spending as the budgetary reality catches up to them regarding the cost of social services and deficit spending. The other point of the story the money that India is putting into updating and modernizing their military by moving to buying advanced Western weapons rather then relying on Russian and indigenous producers is probably more important then the amount of spending.
The article by David Blair and Thomas Harding can be found here.
India goes with AW for new VIP aircraft
Filed under: Agusta Westland, Contract Awards, India, Military Aviation, Sikorsky, commercial aviation, production program
Like the US Navy, India awarded a contract to Augusta Westland for their new VIP transport helicopter. The contract is worth about $300 M. Sikorsky was one of the unsuccessful bidders with their S-92 aircraft. The EH-101 selected will offer a larger cabin, although it is a more expensive aircraft. US companies have been trying hard lately to break into the Indian market as that country has turned away from its traditional English and Russian suppliers. India has also made a great effort to begin developing a sophisticated, indigenous arm suppliers.
See The Hartford Courant article about this contract here.
Gripen NG pitched to the Netherlands
Filed under: Holland, Military Aviation, Proposal, SAAB, production program
SAAB submitted a proposal to the Dutch government for replacement of the F-16 Fighting Falcons in service at this time. The current plan is to buy F-35 JSF aircraft. The SAAB proposal includes the Gripen aircraft, support, training and spares. No price for the 85 aircraft proposal was provided. If it is competitive there may be some desire by the Dutch to buy this aircraft over the F-35. SAAB has also proposed a Gripen to Norway and India.
For more see FlightGlobal.com.
India moves to limit middlemen in contracts
Filed under: Boeing, D'Assault, EADS, FMS, India, Lockheed Martin, MiG, Military Aviation, Proposal, SAAB, production program
India already loosened their offset requirements leading to progress on the new fighter contract. Now the government moved to limit the use of Indian representatives or “agents” in helping the foreign companies with their bid. The six teams that submitted proposals are moving to line up Indian companies to support their fabrication and delivery of the aircraft. By limiting these agents the Indian government hopes to make the process more open and increase the ability of non-Indian companies to use their industry.
See Central Chronicle for more.
Six bids for India’s new advanced fighter
Filed under: Contract Awards, D'Assault, India, MiG, Military Aviation, Proposal, production program
With the decision here to relax the off set provisions required for work on Indian defense contracts India received six new proposals for their new advanced fighter aircraft, the MMRCA. See a story here. Boeing, Lockheed Martin, EADS, MiG, SAAB and D’Assault submitted proposals. Aircraft from these companies are currently under evaluation with a decision to be made in the next several months.
India changes offset reqirements
Looking at several major contracts to be awarded in the next ten years, India’s government has decided to relax their offset requirements. See a story here. As previously discussed here, India had been demanding major off set investments that some foreign companies felt were too difficult to meet. Now the government will allow companies to just hold funding to meet the offset requirements. This will make it easier for companies to bid on the contracts.
Renewed helicopters for India
Filed under: HAL, India, Military Aviation, Proposal, development program, production program
India has decided to put out an RFP for light helicopters after all the back-and-forth. See an article here. As previously discussed the planned acquisition was canceled, then planned again, and now it will be for a reduced number than the last attempt. Now rather then going with a 100% foreign buy the contract will be split between a non-Indian company and HAL. One positive of this is that they plan to limit the tech transfer, requirements that recently have been seen as onerous, to only those for the support of the aircraft.
Boeing Indian contract cancelled due end-user agreements
Filed under: Boeing, Contract Awards, India, Military Aviation, production program
India canceled a contract with Boeing for P-8 maritime patrol aircraft due to disagreements over end-user limits on the US technology involved. See an article here. The $2.2 B contract was ready to go for final approval when talks broke down over how to review equipment to prevent technology transfer. India objected to the harsh provisions. This does not mean that the contract could not be renegotiated, but it may be India turns to another provider.
India ends tank program
Filed under: India, Restructuring, development program, production program
India has decided to not continue their indigenous main battle tank program. See an article here. India had developed and put into production their own Arjun system, but have now decided that it is not what they need for the long term. No more production contracts will be placed and they will instead build out the 120 or so on order. They will look to foreign firms for a more advanced system. Read more
Israel passes Britain to become fourth largest defense exporting country
According to this article in 2007 Israel passed Britain to become the fourth largest defense exporting country. They follow the US, Russia and France now. The two biggest customers are the US and India. The recent win of the Indian AWACS contract, reported here, had a great deal to do with that. The Israeli government and industry have made major strides in recent times increasing their exports rather then just focusing on domestic needs.
Indian Defence Minister stresses good aspects of offset clause
Filed under: India, Military Aviation, Proposal, development program
Bump – According to this article as a way to meet the 30% offset requirement, EADS offered to let India join the Eurofighter upgrade program. India would become part of the program’s member countries, the fifth one to join, and also would have the opportunity to participate in other planned EADS programs.
India’s government currently requires that any contract awarded to a foreign defense company have a 30% offset clause. See an article here. Minister of Defense Antony recently reassured foreign companies that this is not a bad thing. For the new fighter contract currently being bid on by various American, European and Russian companies the offset will be 50%. Some of the offerers are balking at this provision. The Minister rightly points out that this kind of offset will allow the foreign companies to develop capabilities in India that might benefit them in the long run.
6 proposals for India’s new fighter
Filed under: Boeing, Lockheed Martin, MiG, Military Aviation, SAAB, production program
Six companies submitted bids for India’s new fighter acquisition. See a story here. As expected both Boeing and Lockheed submitted bids as well as MiG, SAAB, Aerospatiale and the Eurofighter Typhoon. This goal is to narrow the competition to two or three of the proposals and then choose a winner with first aircraft due in 2011. This means that SAAB has bid on this and the Norwegian buy in less then a week.
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