| Date: |
26-05-2015 |
| Subject: |
Make in India: Adani Group may foray into defence manufacturing at Mundra |
NEW DELHI: Gujarat-based edible oils-to-ports conglomerate Adani Group is quietly evaluating a foray into defence and aerospace production, the latest among big industrial groups eyeing a piece of what many believe to be a sunrise sector under the Modi regime with its accent on big defence spending dovetailed with its 'Make in India' drive.
A clutch of Adani executives has been meeting representatives of large overseas defence companies to explore tieups for manufacturing a range of defence equipment, pitching the group's mainstay asset — the country's largest private port and SEZ at Mundra in Gujarat — with its sea and land linkages as a possible manufacturing location, at least five people familiar with the matter told ET.
The discussions in some cases were led by Karan Adani, the elder son of billionaire group chairman Gautam Adani, these people said, requesting anonymity because of the sensitive nature of the discussions.
The Adani Group, whose businesses span logistics, power generation, coal mining and gas distribution, declined comment, saying it "would not like to comment on the story" in response to a detailed questionnaire by ET.
Last month, the group applied to the department of industrial policy & promotion (DIPP) for a licence to manufacture helicopters under a new entity — Adani Defence Systems & Technologies Ltd — that was registered in March this year.
The Adani Group is the latest among large conglomerates to set its sights on the defence and aerospace sector, an area of huge potential given India's large needs and a shopping basket that has for some years bestowed it the status of one of the world's biggest spenders in this area.
The Anil Ambani-led Reliance Group has also indicated its interest in entering the defence and aerospace sector. Groups such as the Tatas, Mahindra & Mahindra and Larsen & Toubro are beefing up their defence arms.
The sources cited above said Adani executives had held high-level meetings in the past few weeks and exploratory calls are being made to almost all global defence and aerospace manufacturers who have liaison offices in New Delhi. At least two top Adani executives were scouring the sector and had been tasked to report back with possible opportunities, they added.
Among the companies that are being explored for partnerships include Swedish defence and aerospace company Saab, whose product line-up ranges from fighter jets to submarines. The Swedish company is keen on setting up production facilities in India and is eyeing major projects, including the Rs 60,000-crore P-75I submarine contract. It has also offered to produce its light Gripen fighter jet in India.
The sources said Adani was also believed to be exploring possible linkages with Italy's Finmeccanica, which has companies such as Alenia, Oto Melara and AgustaWestland. Other global defence firms that the Adani Group is looking at are US-based Textron that owns Bell helicopters and BAE, which is being considered for a $700-million contract to supply howitzer guns to the Indian Army.
Sources familiar with the exploratory discussions say the talks are mostly centred on specific 'Make in India' projects and that the Adani Group is keen to explore whether its large land holding in Mundra can be used to set up a defence manufacturing hub.
"Things are in exploratory mode right now but it is a fact that the SEZ and port offer a unique advantage to defence industry," one source told ET, adding that the group would take a final call on a full step into the sector after a thorough market analysis that is currently being conducted.
The group, which owns the largest port and SEZ in the country at Mundra, is said to be keen on the 'Make in India' concept and is showcasing its capability to set up a defence and aerospace manufacturing zone that would be well-connected by sea and land.
Source : economictimes.indiatimes.com
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