Anil Ambani’s Reliance Group Sets Eyes on Defense Sector

NEW DELHI - June 1, 2015 - PRLog -- With the defense and manufacturing industry set to cross the $100-billion benchmark in another 10 years, Reliance Group, under Anil Ambani, is all set to make its mark into defense,   joining an illustrious group of the likes of Tata Group, Mahindra Group, and Reliance Industries.

Reliance Group currently expands into multiple service sectors—ranging from telecom, infrastructure and power to financial services. Its defense foray comes with the setup of Reliance Defense and Aerospace (RDA) as a working subsidiary of Reliance Infrastructure Ltd, with Rajesh Dhingra at the helm.

The Group initially plans to wet its feet with defense manufacturing by bidding for helicopters for the armed forces, Reliance Group said in an official statement.  "The 'Make in India' initiative of the government provides a perfect landscape for setting up of a comprehensive defense industrial base in the country," said Reliance Group Chairman, Anil Ambani.

Mr Ambani also reiterated his vision behind venturing into defense—to create new jobs along with bringing cutting-edge technology to the table and cutting down on India’s defense procurements which currently account for a major cut in the country’s GDP.

Inside sources have it that Reliance Group is in the middle of talks with several international majors, including Eurocopter of France, Kamov of Russia, and Sikorsky of the US. These talks are in line with procuring technical intelligence through strategic alliances and partnerships.

Presently, India pumps around $40 billion annually into defense, 40% of which is consumed in buying new equipment and products. Imports account for nearly sixty percent of the overall defense purchases, which makes indigenous defense production a major area of focus for the Indian economy, especially with Prime Minister Modi’s ambitious ‘Make in India’ project gaining steam.

In a departure from the past and in line with ‘Make in India’, the new BJP-led government has given indigenous defense production a new push by easing up investment rules that now permit up to 49% foreign investment in defense manufacturing. Additionally, investments above 49% will be pursued strategically on a case-by-case manner by the Cabinet Committee on Security.

The current gap between domestic demand and production in the defense sector opens a big opportunity for RDA to tap into. As puts RDA’s Rajesh Dhingra, “The Company will be looking at both organic and in-organic route for its growth and capability building targeted at the defense and aerospace sector.”

Reference Link:-http://www.thehindu.com/business/Industry/anil-ambaniled-...