New Delhi: French aviation major Dassault Aviation is looking to buy Anil Ambani’s Reliance Defense stake in their joint venture Dassault Reliance Aerospace Limited (DRAL), which operates a plant in NagpurThePrint has learned.
According to industry sources familiar with the matter, the French company has already initiated talks with Reliance Defense to buy the stake as further expansion of the plant has been stalled due to its inability to infuse more money in the project.
While the French firm holds 49 per cent stake in the joint venture, 51 per cent is held by Reliance Defence.
Dassault and Reliance announced their joint venture and the creation of DRAL on 3 October 2016, barely two weeks after India signed a €7.878 billion deal for 36 Rafale jets.
The joint venture initially planned to recruit and train 650 employees by 2022, with the ultimate goal of launching a full Falcon business jet from Nagpur. However, there are plans in disarray due to informed of Anil Ambani is facing financial problems.
Sources said, since India allows 100 per cent foreign direct investment (FDI) on a case-to-case basis, Dassault Aviation is hopeful of getting the nod. It is learned that, while Dassault Aviation was initially looking for another potential Indian partner, it has decided to go it alone.
Nagpur Plant
DRAL feature in mihan According to sources, the Special Economic Zone in Nagpur was manufacturing components like engine doors, canopies etc. for the Rafale fighter jets, but the activity has slowed down.
The facility was originally meant to manufacture components for the Falcon jets and not the Rafale jets. But in June 2019, ThePrint informed of Dassault Aviation is likely to start manufacturing components of the Rafale fighter jet at its Indian facility, including cargo for global customers.
The facility came as part of the offset obligations in the 2016 Rafale deal, under which 50 per cent of the value of the contract had to be pledged back to India.
According to sources, if Dassault Aviation gets the contract to manufacture 114 fighter jets for the Indian Air Force, it would also like to set up a manufacturing facility for Rafale in India.
While the IAF operates 36 Rafales, it is also considering issuing a tender for 114 new fighter jets due to the dwindling strength.
The 36 were purchased for emergency use, to prevent a sharp decline in the numbers of the Indian Air Force (IAF), which has a sanctioned strength of 42 squadrons but currently has only 31, including the MiGs apart from the older MiG 21s. Including jaguars. 29 – All these will be retired by 2029-30.
The government has decided to go for the procurement of 26 naval versions named Rafale M. While it has a larger ‘Make in India’ component than the IAF – all of which will be manufactured at the Nagpur facility – the numbers are too small for any major indigenous development programme.
(Editing by Richa Mishra)
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