Sikorsky-Tata joint venture applies for defence licence

US-based chopper manufacturer Sikorsky Aircraft Corporation, part of United Technologies Corp, and Tata Advanced Systems Limited (TASL) have applied for a defence licence to manufacture components and assemble helicopters for use by the Indian Navy, according to Steve Estill, vice-president (strategic partnerships), Sikorsky.

“The licence will pave the way for us to set up an assembly line in this country. We will decide on our plans once we hear from the Ministry of Defence. We expect our application to be cleared from the ministry in the second quarter of this financial year,” he told mediapersons here on Monday.

L&T and Mahindra & Mahindra are among the other big Indian companies that have received licences in the past to manufacture defence equipment.

India liberalised the defence industry in 2001, allowing 100 per cent participation by the private sector with foreign direct investment permissible up to 26 per cent, both subject to licensing and security clearance.

The Sikorsky-TASL contract was formed in 2009 to make helicopter cabins for the US company. Both the companies had also signed an agreement to create a joint venture that will manufacture aerospace components for Sikorsky in India, including components for S-92 helicopter cabins. TASL has 74 per cent shares in the JV. The JV broke ground last year and started producing over 4,000 parts and sub-assemblies for rotary and fixed-wing aircraft from this March 6 from its facility on the outskirts of Hyderabad .

According to Arvind Walia, executive vice-president (India and South Asia), Sikorsky, the company was among the two firms to be shortlisted by the ministry to supply 16 multi-role choppers to the defence sector.

“We expect to be L1 for this contract, which is pegged at about $1 billion. The only other manufacturer to be shortlisted is a European company called NH Industries. We have completed all formalities as far as the flight evaluation trials are concerned. We hope to here from the ministry a firm date for opening of commercial bids in the next two weeks,” he said.

Walia said the naval multi-role helicopter contract was under the ‘buy and make (Indian)’ category, which allowed private sector companies to bid and hold the primary contract, and that the programme was at the RFI (request for information) stage.

“We have provided the information and Sikorsky has no hesitations in addressing this requirement of this country for the ‘buy and make’ category. Our aim would be to bid locally. We can rename our Tata-Sikorsky JV so it will be a local company bidding in the next round for the Navy,” he said.

Meanwhile, the Tata-Sikorsky S-92 helicopter cabin manufacturing facility here is doubling its production to 26 units annually from this month on the back of growing demand.

“Right now, the cabins that we make here are fitted with all components produced by Sikorsky-Mitsubishi’s Japan facility, which is being closed down in a phased manner. Within a year, the Hyderabad facility will use completely indigenous components for its cabins,” Walia said.

Sikorsky had so far delivered S-92 choppers globally. S-92, a tricycle-configured chopper with a nose wheel, costs around $22 million. The company expects to sell around 120 units worldwide over the next two years.

“The Indian commercial and military helicopter markets are set to touch $8 billion and $33 billion respectively over the next 25-30 years, to become the second largest chopper market in the world after the US. We hope to sell at least two units in the commercial market here, if not more, this year,” Estill said.