Reliance Group chairman Anil Ambani is expected to outline his group's plans for a foray into defence equipment manufacturing sector at a chief executive's forum meet called by Defence Minister Manohar Parrikar at the Aero India show in Bangalore next week, according to company sources.
"The 'Make in India' initiative of the government provides a perfect landscape for setting up of a comprehensive defence industrial base in the country," Ambani said about the latest foray. "The Reliance Group is committed to contribute significantly to this initiative," he said.
"We would endeavour to bring world class technologies to India and create skill sets within the country to deliver top end platforms for our Armed Forces, cut down on import of defence products and create high skill jobs," he added.
"The government's policy of self-reliance in defence equipment manufacturing and the opening up of the sector to private investment has thrown up an immense opportunity. Our chairman is likely to speak about this at the Aero Show," a company source said.
"The defence minister has called a meeting of around 17-18 chief executives on Feb 18 -- the inaugural day of the show. Our chairman has been invited. Some of his plans will be unveiled at that meeting," the source told IANS.
Reliance Infrastructure also informed the stock exchanges Thursday that it has formed three wholly-owned subsidiaries -- Reliance Defence Systems, Reliance Defence Technologies and Reliance Defence Aerospace to pursue growth opportunities in the defence sector.
The group intends to explore opportunities in all the three wings of the armed forces, notably on the naval platform, air mobility, avionics and network centric warfare, company officials said. The former India chief of Lockheed Martin, Rajesh Dhingr, will lead this initiative.
"In fact, talks have already started with potential foreign collaborators for tie-ups. Some key acquisitions are also not ruled out in the inorganic space."
The announcement also had an immediate impact on the company's stocks, which were trading more than 3.5 percent higher at around Rs.440 around noon.
A part of the larger 'Make in India' programme of Prime Minister Narendra Modi, defence ministry officials explained that the government wants to encourage domestic production of equipment, as 60 percent of the capital requiremrnt is met by way of imports.
The allocation for defence sector in the current national budget was $37.3 billion and it has been officially estimated that an investment of over $4 billion will be needed in seven-eight years from domestic and overseas sources.
