Airshow: Eurocopter would manufacture in India if wins contract

By A. Ananthalakshmi

BANGALORE (Reuters) - Eurocopter plans to set up a production line in India to make its Fennec helicopters, if it wins an Indian defence contract for the aircraft, its chief executive said on Thursday.

The company, a unit of aerospace and defence company EADS , is competing for a contract to sell 197 reconnaissance and surveillance helicopters.

"We will set up a production line in India," Eurocopter CEO Lutz Bertling said at an airshow held in Bangalore.

Bertling expects the government to decide on the cheapest bids in the first half of 2013. "So after further negotiations, the assembly line could come up in mid-2014."

The factory would produce between 25 and 50 helicopters a year, depending on the size of the contract, he told Reuters, adding the company was in talks with several local companies to set up the production line.

Eurocopter previously won a contract to sell 197 helicopters to India, but the deal fell through in 2007.

Echoing comments by other executives at the airshow, Bertling said there was no indication that India's planned budget cuts would affect its tenders in the country.

India is planning cuts to its budget this year, including some affecting defence, to reduce spending by about 1.1 trillion rupees in the current financial year, or some 8 percent of budgeted outlay.

"We have zero indication that any request for proposal (RFP) which is out already to be affected. We can imagine for future programs it would be bit of a stretch of delivery time," he said.

(Reporting By A.Ananthalakshmi; Writing by Aradhana Aravindan; Editing by Jeremy Laurence and David Holmes)