Kalyani Group, Rafael start unit for making missiles

Kalyani Rafael Advanced Systems would be the first private sector entity to make such weapon systems

Kalyani group and Israel's state-run Rafael Advanced Defence Systems on Thursday started a Rs 70-crore anti-tank guided missile production facility at Hyderabad. 

Kalyani Rafael Advanced Systems, a venture of the two with 51 per cent ownership with Kalyani group, would be the first private sector entity to make such weapon systems in the country. Kalyani group chairman Baba Kalyani said the venture is ready to supply the missile, Spike, to army, and 90 per cent of its components will be sourced locally. 

"The Spike missile is a fully-built ATGM (anti-tank guided missile) unit except for the explosives and the propellants, and we can supply this weapon which has a 2.5 km range to the Army within a couple of weeks of getting orders," Kalyani said.

The 24,000 sqft facility was set up in under 10 months and can produce "thousands of missiles", Kalyani said, adding the company will look for overseas customers if the Army delays orders.

When asked what is making the Army delay its order as Spike is fully tested and approved by it, Kalyani said there were "procedural delays".

It can be noted that the first 'Request for Qualification' for anti-tank guided missile production was invited in 2010 but nothing moved as there was a lack of policy clarity on FDI in the defence sector.

Kalyani today said the JV is ready to invest another Rs 60-70 crore in the facility, depending on government or overseas orders over the next two years.

"We see $1 billion worth business opportunity with this business vertical. We also have plans to begin production of Spike missile, which is an air-to-surface weapon, for the Air Force soon," he said.

Kalyani Strategic Systems, the defence vertical of the $2.5 billion group having its origins in auto components, entered into the joint venture with $3 billion Israeli government-owned Rafael in 2015.

"The JV will invest in high-end technology and advanced manufacturing techniques to design, develop and manufacture weapon systems for the Defence forces.

"This venture will offer direct employment to 300 and around 1,000 people indirectly through its hundreds of vendors who are all in the small scale sector," Kalyani added.

The plant was inaugurated by Telangana industries, commerce & IT minister Kalvakuntla Taraka Rama Rao in the presence of Israeli envoy Daniel Carmon.

The facility will enable production of high-end technology systems for the Armed forces and will be engaged in developing a wide range of advanced capabilities like command control and guidance, electro-optics, remote weapon systems, precision guided munitions and system engineering for system integration.

It will also aim to export products to other countries, especially to south-east Asia, said Yoav Har-Even, president & chief executive of Rafael Advanced Defence Systems.

Rao said Hyderabad is home to over 30,000 defence electronic engineers as it houses almost all public sector entities working in this field.