Nagpur: Mihan
SEZ in city will play a major part in upkeep of 36 Rafale fighter jets India is buying from France. A majority of work to be undertaken by a joint venture between French aircraft maker Dassault and Reliance -- announced on Monday -- will be done here. The JV has been formed to execute offset contracts arising out the deal.
A year ago, Anil Ambani-run Reliance Aerostructure was allotted land in Mihan SEZ for setting up an aerospace park. The plan included a 6,000 crore facility to make aircraft spares and eventually entire aircraft and helicopters. Initially the plan appeared to have run into rough weather. The company soon reduced its land requirement to less than half of the 289 acres it was originally allotted. There were reports of Reliance getting an order for Russia’s Kamov helicopters, but there was no further development.
Now with the new joint venture, Dassault Reliance Aerospace, Reliance is looking to have the biggest order book in the sector. The overall offset business has been pegged at 30,000 crore highest so far in the industry. Reliance is expecting business worth at least 22,000 crore under the deal. The orders have to be executed over a period of seven years.
A whole gamut of industries including small and medium enterprises will also be involved in the process, said sources privy to the affair. The next step will be sharing of designs by the aviation company. The taxiway connecting Reliance’s site with the existing runway is also expected to be built by Maharashtra Airport Development Company (MADC) by the time facility at Mihan is ready, said a source.
The setting up of the joint venture comes after India and France inked a 7.87 billion (around 59,000 crore) for buying 36 Rafale fighters. The first jet will be delivered between October 2019 and early 2022. The defence ministry’s offset policy makes it mandatory for any foreign firm bagging an arms deal over 300 crore to plough back at least 30% of the contract value back into India. The Rafale deal has a 50% offset clause, making it the largest-ever. Under the contract to be executed over seven years, 74% of the offsets have to be imported from India to make aircraft components.
The JV will execute the offsets of Dassault as well as other firms involved in the Rafale deal like Thales and Safran, while those of missile manufacturer MBDA will be handled separately. “The formation of this JV with Reliance Aerospace illustrates our strong commitment to establish ourselves in India and to develop strategic industrial partnerships under the ‘Make in India’ policy promoted by the Indian government,” Dassault CEO Eric Trappier said in a statement.
Ambani, in turn, said, “We are delighted to partner a world leader in aviation like Dassault Aviation, and a visionary leader like Eric Trappier. This is a transformational moment for the Indian aerospace sector and for Reliance Infrastructure’s subsidiary Reliance Aerospace.”
Sources in state government said MADC had decided to start building the taxiway only after Reliance Aerostructure finishes half the work on the plan it submits to the agency. Reliance will have to submits a plan now. For this, the company will have to pay the remaining 38 crore for the land cost and sign a lease agreement.
Source : timesofindia.indiatimes.com