IT services major Tata Consultancy Services (TCS) is looking to open a client-dedicated offshore development centre (ODC) for aerospace giant Rolls-Royce Group Plc in India to cater to the latter's design requirements. Under the Indian government's $10-billion defence offset programme, Rolls-Royce has a commitment to offset 50 per cent of its research and development requirements to Indian design companies.
Sources familiar with the plan did not specify where the centre would be set up, but added that it would be operational this year. "The new centre will handle a substantial volume of sub-contracted defence offset work from Rolls-Royce," they said.
A TCS spokesman did not respond to queries on the development.
India's fleet of Jaguar fighters and the Hawk, an advanced jet trainer, are powered by Rolls-Royce’s military engines.
Rolls-Royce is understood to be in the process of rolling out a series of new engine design, analysis and development programmes under the offset program and has been looking at roping in an additional partner, besides Bangalore-based engineering services firm QuEST Global, to handle its sub-contracting requirements in India.
QuEST Global currently manages Rolls-Royce's dedicated engineering development centre in Bangalore. Rolls-Royce also entered into a manufacturing JV with long-time partner Hindustan Aeronautics (HAL) last month to manufacture civil aero-engine components and sub-systems for export.
Industry observers note that the Tata Group, being a major player in the automobile sector, has been interested in exploiting forward and backward linkages with the aerospace industry. The group has been looking at moving into full-scale aircraft assembly and production for both the civil and military markets.
Tata Group has a deal in place to manufacture components for Boeing, and a one-third stake in Italy's Piaggio Aero. It has signed a MoU with Israel Aerospace Industries (IAI) to establish a new company to develop, manufacture and support a range of defence and aerospace products. The Tatas have also sought approval to set up an aerospace manufacturing facility on the outskirts of Hyderabad.
India is expected to have a 2-3 per cent share of the aerospace offshored engineering services market by 2010, according to a recent Nasscom-Booz Allen Hamilton report.
Bangalore has been at the forefront of aerospace component and defence equipment manufacturing, and is a growing hub for aerospace engineering and design. Honeywell Technology Solutions’s engineering facility in Bangalore employs over 5,500 engineers, while GE's Jack Welch Technology Centre has an extensive research lab with over 3,000 engineers. Airbus is setting up an Airbus Engineering Center India (AECI) facility in Bangalore, which will hire over 200 engineers, and more than 2,000 via its technology partners.
