GE may set up aviation repairs unit

Betting high on the fast-growing aviation market in India, General Electric (GE) is angling for contracts to build maintenance and repair facilities in the country and has bid for a huge defence R&D organisation project.

The company is in talks with national carrier Air-India and state-owned aircraft maker Hindustan Aeronautics Ltd (HAL) to set up a maintenance, repair and overhaul (MRO) facility.

It has also made a bid for a defence contract that could be between $1.2 billion and 2.4 billion for joint development and production of India's indigenous jet engine, Kaveri.

"We are talking to A-I and HAL for the MRO facility. The facility would be for engine overhauls and will be available for other GE engine users," a top GE official said.

The negotiations assume significance as GE chairman and CEO Jeff Immelt, during his India visit last week, announced that the company will focus on airline customers' maintenance and overhaul requirements. "We could bag engine orders from Air-India, Indian and Jet Airways worth $3 billion," said Immelt.

In March this year, A-I had placed an order valued at $2.2 billion with GE to power the national carrier's to be acquired Boeing fleet of aircraft. A top HAL officer said that they were in talks with GE and other firms for the MRO facility that can have both civilian and military applications.

"We intend to set up MRO facility and are in talks with several engine firms, including GE. This could be finalised in the current year itself," the official said.

Though the post-Pokhran US sanctions hampered Indian hopes to fly its warplane with a homegrown jet engine, GE has made a bid to tie-up with Defence Research and Development Organisation (DRDO) for joint development and production of the indigenous Kaveri engine.

The contract could include a risk-sharing, joint development and production relationship on the Kaveri or any other engine that can be developed afresh for the light combat aircraft (LCA), Tejas, the official said.

"We are bidding for the contract. The current operational prototypes of the Indian LCAs are powered by our GE F 404 engines. However, the Union government has to take a final decision on this matter," said the GE official.

Late last year, DRDO had invited tenders for a global partner with a proven record in combat aircraft engine development to help its one-and-half decade old engine development programme.

DRDO sources said that five bids have been shortlisted and a final decision would be taken by the defence ministry. The other bidders include Canadian engine maker, Pratt & Whatney, European aeroengine majors "� Snecma Moteurs and Rolls Royce, and Russian firm NPO Saturn.

The four operational prototypes of LCAs are now powered by GE F404 F2J3 engines. DRDO had ordered an additional 57 GE-404 N20 engines, with GE as the Indian Air Force has placed an order for 40 LCAs.

Started in 1989, the gas turbine and research establishment, a Bangalore-based DRDO lab, is developing Kaveri engine. The gas turbine and research establishment has so far spent Rs 1,300 crore on the engine project and last year, the cabinet committee on security revised the estimate for its future development to Rs 2,800 crore.