Indian Offsets Contracts Fuel Bharat Electronics’ Growth

DW : What is the order book of BEL considering that it is India’s premier defence electronics company?

V V R Sastry: BEL has set itself a revenue target of Rs.4,560 crores ($975 million approx) for the financial year 2008-09, with a growth rate of 13% over the previous year. The company’s Order Book as on December 31, 2008, exceeds Rs.10, 000 crores ($2 billion approx). BEL has hired KPMG to help identify future market opportunities for growth. The study by KPMG is nearing completion.

DW : What are the key projects that BEL is executing at the moment?

V V R Sastry: One of the major projects bagged by BEL this year is the Akash Defence System, which is to be delivered in 36 months. 2 Squadrons of Akash are to be supplied to the Indian Air Force. The order value is Rs.1,221 crores ($265 million approx). BEL is the nodal agency for Akash which means is the lead integrator. The missiles part will be supplied by Bharat Dynamics Ltd. BEL has tied up with Tata Power, L&T, Walchand Industries and ECIL for the project, for launchers and other sub-systems. This project will showcase the public-private partnership strength of the country. On another major development, BEL has been selected by Northrop Grumman for the manufacture of components for Fire Control Radar for fighter aircraft. As part of a comprehensive co-production programme, the BEL team will work side-by-side with Northrop Grumman engineers to provide training and support to ensure a smooth transition to production. The engineering teams will collaborate on all aspects of the manufacturing process, beginning with a formal Production Readiness Review (PRR), and concluding with First Article Inspection (FAI) and First Article Test (FAT) milestones. Initial radar component deliveries are expected in the second quarter of 2009.

DW : How are you positioned to take advantage of offsets which suppliers of defense hardware to India have to implement?

V V R Sastry: BEL has been selected as offset business partner by many multinational companies such as Boeing, Lockheed Martin and Northrop Grumman. As the country’s leading defense Electronics Company with a highly trained engineering work force, BEL will be the choice partner for anyone wanting to implement offsets in the electronics field. We have the technical expertise to execute projects in a variety of areas concerning electronics, from whole systems to components.

DW : Can you please highlight some specific technical areas in which you have expertise and which constitute your current and future portfolio of work.

V V R Sastry: We are exploring joint ventures (JVs) with various reputed foreign / Indian firms in a number of technology areas. These include Infra Red (IR) Seekers & Missile Electronics, Thermal Imagers, RF & Microwave Subsystems, TI Detectors, Airborne Electronic Warfare (EW) Systems, ATM Radars, Solar Photovoltaic cells, Simulators, Software for C4I and computational platforms for Radars, Sonar’s and EW Systems.

DW : Can you please elaborate on some of the agreements you have entered into during Aero India 2009.

V V R Sastry: BEL and SELEX Galileo signed a MoU on Feb 11, 2009 which will explore potential opportunities in the field of Electronic Warfare in the Indian market for offset requirements and contract manufacturing for export markets. Current opportunities include offset requirements in Ministry of Defence programmes like the MMRCA, where SELEX Galileo is participating through global aircraft manufacturers. BEL and Astra Microwave Products Ltd, Hyderabad, signed a MoU on the same day to explore formation of a joint venture company for design and manufacture of Microwave Components & Assemblies. These products of JVC at sub-system level will cater to the requirements of the Indian defence, paramilitary, government establishments, other civilian and international customers.