Defence PSU Bharat Electronics (BEL) and Thales announced on Wednesday that they were set to form a joint venture to manufacture civilian and defence radars. The venture is expected to start operations within 18 months.
This follows the decision of the directors of both companies to form the joint venture (JV) which is subject to mandatory approvals of the respective governments. The two companies had signed a memorandum of understanding (MoU) about three years ago, on November 17, 2009.
“The joint venture company will focus on the design, development, marketing, supply and support of civilian and select defence radars for Indian and global markets,” BEL said in a statement. BEL has been a major player in the electronics field in India, with the company manufacturing radars for military purposes.
The parent companies aim to make the joint venture company a centre of excellence with the ability to offer solutions specifically aimed at meeting the needs of both Indian and global customers. Thales is most likely to tap its offsets commitment with this venture, according to defence experts.
In accordance with Indian regulations, Thales will be able to hold only 26 per cent equity, the maximum allowed holding by any foreign company in the defence sector, while Bharat Electronics will hold 74 per cent.
This will make BEL part of the global supply chain for Thales. Under earlier licence deals with the French company, BEL had built the Thales LW04, DA08 and ZW06 naval radars.
Thales is expected to provide its expertise in system engineering, integration and testing, along with some technology transfer. Thales had recently demonstrated its capabilities in air defence solutions, force protection, missile systems and rocket systems, including a mobile ground C4I system for complete airspace surveillance and its mobile short-range air defence system in India.
Thales had recently won a contract to upgrade 49 Mirage 2000s of the Indian Air Force (of which two were lost recently) to bring them to the full Mirage 2000v5 Mk 2 standards. The deal includes an RDY-3 radar with greater air-to-air and air-to-ground capability, a new night-vision-compatible all-digital cockpit, and improved electronic warfare systems.
India’s defence procurement process requires offsets of at least 30 per cent, and it is likely that the joint venture might also satisfy offsets associated with India’s selection of the Dassault Rafale for its medium multi-role combat aircraft (MMRCA) requirement for 126 fighters. Thales is a partner in the Rafale programme.
Work on the Mirage upgrades will be performed by Dassault, manufacturer of the aircraft, along with Thales as weapons systems integrator, MBDA as missile supplier and India’s Hindustan Aeronautics Limited (HAL). The first two Mirages will be refitted in France, the next two by HAL in India under French supervision and the remainder by HAL.