Aerospace Diary

Neelam Mathews Aug 22, 2012 With the delivery of its 13 th aircraft, slow and steadily growing GoAir has introduced a new flight from Lucknow to Delhi and Mumbai.  GoAir is the only low cost carrier in India offering a business class service aimed at SME customers. It recently entered into a contract with Germany-based and worldwide market leader Lufthansa Technik for maintenance and spare parts for its A320 fleet. “Within this financial year …..more flights are planned to connect major metros to Tier two and Tier three cities….. ,”   Giorgio De Roni, CEO, GoAir, said . GoAir services 22 destinations in India with 707 non-stop and over 2,000 connecting flights per week. An additional new aircraft will be added within the end of this financial year .

Neelam Mathews July 23, 2012  The much-awaited Defense Procurement Policy 2012 has been cleared by the Cabinet Committee on Security (CCS), Aerospace Diary learns. "The offsets policy will be released very soon. There were a few points that needed to be ironed out, a reason why it was late," a senior official in the MoD told Aerospace Diary. The policy will not be retroactive and will be valid from the date it is introduced, we are told. While the policy is expected to include  transfer of technology (TOT), vendors remain unclear how this will be implemented without any body to monitor it nor the method of payment for TOT. The question of IPR also needs to be addressed. The  2012 USIBC  advocacy agenda advancing the U.S. – India defense commercial relationship had asked for  India to formulate a robust offset policy that promotes transparency and  predictability, leading to a meaningful build-up of India’s indigenous industry capabilities  ...

Neelam Mathews April 2, 2012 The much awaited revised offset policy is out. It reinforces its aim is to augment capacity for R&D, foster development of international competitive enterprises and give a boost to synergistic sectors like homeland security and civil aviation. The policy recognizes: TOT as eligible for discharge of offset obligations Technology acquisition by DRDO for a list of specified technologies will be treated as an eligible offset with a multiplier of upto 3. While Tier 1 subvendors can already discharge part of obligations on behalf of the main vendor, the overall responsibility will rest on the vendor. Offsets can now be discharged within a timeframe extending to two years beyond the period of the procurement of the contract Validity of Banking of offsets has been extended from 2 to seven years In the discharge of offsets obligations relating to direct export, FDI, TOT  or investment in ‘kind’ through non equity route, a multiplier of 1.50 ...

Neelam Mathews Jan 30, 2012 Hyderabad's privately owned Small and Medium Enterprise company, Raghu Vamsi Machine Tools into manufacturing of precision engineering parts for Aerospace and Defense industries has entered  into a joint venture with Industria de Tuberias Aeronauticas(ITA), a Spanish company and Reginson Engineering Ltd ("Reginson"), a British Company. The JV will be named "Reginson India" and will have three partners, each contributing the right mix with ITA providing the market access , Reginson providing the product know how, and Raghu Vamsi providing the local market knowledge and industrial capabilities. The JV will manufacture machined components designed to be assembled into rigid and flexible pipes or ducts, i.e. End Fittings for Aircraft Engines. The JV will invest Rs 25crore in 3 phases - Rs 10 Crores in the first year with a target of Rs 100 crores in the next 5 years. The joint venture is (possibly) the first of its kind in engine compo...

Neelam Mathews Sept 22, 2011 India ’s Tier– 3 suppliers of defense products say business cannot take off till the government relooks at a clause in its offsets policy that does not permit OEMs to get offsets if they do not make the order direct. “We are getting a poor deal as a result. For instance, a foreign OEM now gives the order to a company like Tata that has a host of companies with different products. This gives the OEM benefit of offsets instead of having to source it through its partner……The products are more expensive and the benefits are not coming down to tier 3 suppliers as a result,” says Pradip Mehta, Senior Advisor, Elcom Systems, a subsidiary of the Sun Group. Mehta says the defense industry is increasingly getting dominated by large companies like L&T, Godrej, Tata and Mahindra. Elcom Systems has ambitions to join the OEM value chain for India and internationally. It is looking at manufacturing components, harnesses and avionics to tap the opportunity th...

Posted by-Neelam Mathews Aug 17, 2011 With Reserve Bank of India hiking its policy rate for the twelfth consecutive time, the Small and Medium sector in the Indian Aerospace and Defense Sector is facing a credit crunch, says a report by defense advisory, Aviotech. Interest rates for short to medium term liquidity are upward bound in the15-18% per annum range. This has created structural issues of both access and availability of credit, says the report.   Coupled with legacy issues of cyclicality  in order books and perceived high  risk categorization by Indian banks, an increased strain on sustenance of operations in this segment is anticipated. The report notes an expansionary impact in Indian A&D players from Offsets opportunity. A capital commitment of $10 billion is envisaged from Offsets in the next 4 to 5 years. This is expected to firm up short term revenue and order books of key players. Additionally, this also presents the Indian A&D as an emerging...