WHAT

INDIA DEFENCE CONSULTANTS

WHAT'S HOT? –– ANALYSIS OF RECENT HAPPENINGS

DEFEXPO 2002

PRAGATI MAIDAN --19–23 FEBRUARY 2002 --

PROMISES TO BE A MONEY SPINNER

An IDC Analysis

New Delhi, 18 January 2002

Well organized defence exhibitions are big money spinners. This year the Confederation of Indian Industry (CII) is going to be the gainer during the forthcoming Defence Show at Pragati Maidan. India is the big ticket for Defence purchases and now the Ministry of Defence has given authority to the Services to spend Rs 3000 crores under their own powers. The WTC attack, the developments in the security scenario post 11 September; the war against terror in Afghanisatan and Indian and Pakistani mobilization have heightened the procurement process of arms in South Asia.

Pakistan just got 40 F-7G fighters with Grifo radars, hence substantial increase in Defence outlays will be an outcome. India’s defence budget cannot but increase over the $13.6 billion allocated for 2001–2002. The Finance Minister, Defence Minister and others are echoing this. Thus India’s second DEFEXPO 2002 which is to be held at New Delhi’s exhibition grounds in Halls 1 to 12 from 19–23 Feb 2002, has attracted world wide attention and has been heavily booked (16,000 sqm up from 10,000 sqm in 1999) by Indian industry and 16 other countries.

The latest entry is by USA, which has lifted sanctions but seems to have some reservations on the sale of 3 Phalcon AWACS Radars to India by Israel’s IAI as they have some Lockheed inputs. However RM George Fernandes is in USA, hopefully to smooth out the glitches. General Electric Bell Helicopters and US Commercial Department have firmed up their attendance and Raytheon and some other companies were in final stages of decision-making.

The major countries taking part (over 75 companies) are: Africa, Bulgaria, France, Israel, Italy, Poland, Republic, Russia, Singapore, Slovak South Sweden Switzerland, UK, and USA. A sample survey of the companies shows that the regular suppliers of equipment will be on site and many new names of big foreign companies figure in the list:

Russia dominates the scene with the Sevrnoye Design Bureau, which has helped design many IN ships –– the foremost being the Krivacks –– the first ship INS TALWAR is undergoing trials. Others from Russia are Novotar, which has supplied the Klub missiles, Rubin submarine Designers, which hopes to supply 2 Submarines along with some 14 other agencies.
UK is the next largest with the Defence Manufacturers Association, DESO, BAE systems (which is still in the run for the 66 AJT deal of BAE Hawk C-115), Chemering and a host of others.
France will be present with the giant THALES, DCN –– which is due to sign the Scorpene deal, Sagem, SOFEMA and others.
Israel which has supplied ammunition, missiles, pods, the Barak systems, radars and UAVs will be represented by Sibat, IAI, Rafael, Elbit and others including Plasan SASA which has a joint venture with Mahindra Defence Systems for Military vehicles.
Armscor of South Africa is coordinating all the industries that have made supplies to India and the contingent includes OMC Vickers who supplied the Cassipir armoured vehicles.
Sweden will be fielding FFV Ordnance and SWS Defence AB and the Italian Agusta, Alenia Marconi and the Embassy will be on hand.
With renewed American attendance the show promises to be a very professional one with bright business prospects, especially for joint ventures as the new rules permit Foreign Direct Investment up to 26%.

The Ministry of Defence has issued invitations to over 75 countries and delegations are expected from over fifty including Algeria, Austria, Bangladesh, Bhutan, Egypt, France, Ghana, Indonesia, Iran, Israel, Jamaica, Kenya, Malaysia, Maldives, Mauritius, Nepal, Nigeria, Namibia, Philippines, Russia, Saudi Arabia, Singapore, South Africa, Sri Lanka, Sultanate of Oman, Syria, Tanzania, Thailand, Turkey, UAE, UK, USA, Vietnam and Zimbabwe.

As of writing, Pakistan and China are not in the list released by the authorities. This year with the opening of the Defence Industry to Foreign Direct Investment, nearly 100 Indian entities have booked space and the visitor profile will be much more with key decision makers on site.

The CII in partnership with Ministry of Defence (Department of Supplies and Production) have organized the DEFEXPO 2002 on a commercial basis. The UK is fielding its large contingent on an ‘Industry Day’ –– one day prior to the start of the exhibition. Their marketing thrust throughout 2001 has been strong.

A two-day Defence Industry Summit cum Seminar with eminent speakers is also scheduled on 21 and 22 Feb 2002, with the focus on how to evolve strategies for defence manufacturing and exports in the changing scene of India moving from localization and Government control to globalisation.

As Indian defence has been guarded in its approach to media, intelligence agencies attention will also be heightened. Jane’s, Guide Publications, Asian Defence Journal, Asian Military Review, Vayu Aerospace and International Aerospace have already taken up stalls, while many more media and professionals will attend to gauge future prospects in India, which appear bright and more transparent under the new Defence Procurement System.