India Navy to flag off Tata products

Wed, May 14 12:45 AM

The Tatas, one of India's largest business conglomerates, will soon be involved in the modernisation of the Indian armed forces. After signing a memorandum of understanding (MoU) in February 2008, the Tatas and Israeli defence major Israel Aerospace Industries (IAI) have on Tuesday signed a "framework agreement" to produce defence and aerospace products.

The Indian government opened the defence production, which had been the preserve of handpicked public sector units, to private companies in 2001. Larsen and amp; Toubro , the Tatas, Mahindra and amp; Mahindra and Godrej are in the defence business.

The Tata group has signed a framework agreement with IAI and a joint venture company will be formed soon, the Tatas said in a statement. The venture will produce missiles, radars, electronic warfare systems and homeland security systems, according to the release.

Tata Advanced Systems is spearheading the joint venture. The venture will bid for multi-billion dollar contracts for upgradation of various missile and electronic warfare systems for the Navy and the Air Force, according to a source close to the Tata group.

The upgradation proposal for both the defence services have been put up for consideration with the defence ministry. "There are upgradation plans for the ageing Pechora anti-aircraft systems.

IAI has made a proposal for the advanced Barak surface-to-surface missiles for the Navy. If successful, a part of the project work might be done in India along with the Tatas," he said.

The JV will provide greater technological access for the Tatas as it plans to consolidate its defence expertise, which is spread over several group companies, said analysts. "Several Tata group companies have expertise in several defence verticals.

Tata Powers' Strategic Electronics Division (SED) is making rocket launchers, and Tata Industries is making parts for fighter jets. The group is forming joint ventures to get more advanced technologies and has the makings of a full-fledged defence company," said a Mumbai-based analyst working with Kotak Securities.

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