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Indian Firms Set Teams for Helicopter Tender

February 11, 2015 (Photo Credit: Sam Panthaky/ AFP)

NEW DELHI — In India's first helicopter competition reserved for domestic defense companies, teams have been established between top defense companies Larsen & Toubro with Airbus Helicopters and Tata Advanced Systems with Sikorsky Aircraft to produce a light utility helicopter (LUH).

Other corporate arrangements include Mahindra Defence Systems teaming up with Bell Helicopter and Punj Lloyd with Russian Helicopters. The domestic companies have to respond by Feb. 17 to a request for information (RFI) they received in October to provide the helicopters on a Buy and Make (India) basis in the $2.5 billion tender.

State-owned Hindustan Aeronautics also is negotiating a tie-up with Russian Helicopters.

None of the overseas or domestic companies would discuss their partnerships.

A Ministry of Defence official said there is no certainty that the helicopters built by the domestic companies would be cheaper than importing them directly.

"The idea is to build capabilities in India to build the defense industrial base and have in-house lifetime support and maintenance," the official added.

While the RFI describes the purchase of 197 light utility helicopters — 133 for the Army and 64 for the Air Force — India has a requirement for more than 400, an Air Force official said.

Defense analyst Nitin Mehta, however, is not sure if the program will ever take off in the domestic sector.

"The fresh procurement process for LUH, which has begun after the cancellation of the earlier global tenders, will further delay the acquisition of the much-needed helicopters. The domestic private-sector companies, having no experience in making helicopters and will begin from scratch, will add to the delay, which will ultimately prove counterproductive," Mehta said.

"At [some point] India will have to buy the much-needed LUH from the global market on a fast-track basis," Mehta said.

Russian President Vladimir Putin, during talks with Prime Minister Narendra Modi in New Delhi on Dec. 11, had offered to build in India the Ka 226 LUH for domestic and export purposes. However, the government decided to pursue an open competition.

The RFI says the LUH will be needed for reconnaissance and surveillance, to direct artillery fire, for quick-reaction teams for special missions, aerial photography, serving a scout role in conjunction with attack helicopters, and to monitor nuclear, biological and chemical incidents.

The tie-ups only represent an initial intent to partner in the helicopter tender and become formal only after responding to the RFP.

When the Modi government came to power in May 2014, it canceled a 2009 global re-tender to purchase 197 LUHs and instead issued the RFI only to domestic defense majors as part of its policy to build domestic industry capabilities. At the time of cancellation of the tender, Eurocopter's (now Airbus Helicopters ) AS550 helicopter was in competition with Russia's Ka-226T built by Kamov.

In August, the MoD also canceled a 2012 tender to buy 56 naval utility helicopters in which Airbus Helicopters and AgustaWestland were competing.

Email: vraghuvanshi@defensenews.com

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