'Firms need to be prepared for long gestation programmes'

The United Nations Industrial Development Organisation (UNIDO) has entered into a co-operation with the Society of Indian Aerospace Technologies and Industries (SIATI) to create a long term development programme for aerospace SMEs.

The huge opportunities that would be available for India can be tapped only through supplier development programmes. Bala Bharadwaj, managing director, Boeing Research and Technology-India, Boeing International Corp India Ltd, said there is a great opportunity in India which is to the tune of over $30 billion over the next 10 years. However, despite having the advantage of low cost labour and capital, the cost of material is quiet high due to the import duties. Further, companies need to be prepared for the long gestation programmes and the quality requirements of the industry. According to him, “the steps to the Indian aerospace industry are develop, acquire and team up.”

Meanwhile, UNIDO’s co-operation with SIATI will happen through sub-contracting and partnership exchange; through supplier development programmes and match-making services through global networks. “While UNIDO will bring global networks to the members of SIATI, Indian SMEs will be exposed to the international buyers,” said Krishnadas Nair, chairman, SIATI.

The Indian aerospace sector offers opportunities for the global aerospace industry with its growing markets. In the recent past, the aerospace sector in the civilian private space has been seeing a phenomenal growth.

The nascent private sector, though cautious, is looking forward to the international experience for in this sector which has very long life cycles. Alejandro Vera Casso, adviser to ITU (Investment and Technology Unit) in UNIDO Vienna, said that the UNIDO which began supporting the governments in preparing feasibility studies for building large PSUs in the early 70s is now focusing on strengthening SMEs. UNIDO brings global networks, local institutions together for a common objective of equitable growth. He said, UNIDO has been working with the automotive sector and the general engineering sectors.

Now, its entry into the aerospace sector is not as an aerospace expert but as a facilitator of SME development.

Martin Wright CEO of the North West Aerospace Alliance, described the importance of aerospace supply chains to a growing economy and the way supply chains and clusters needed to continually evolve to meet the changes in technology, programme demands and the way that supply chains are structured to deal with risk and financing. It focussed on the need for a long term view of investment in equipment, processes and skills to match the long term nature of the industry.