ET BureauState-run Hindustan Aeronautics Ltd, India’s oldest aerospace company, isn’t going through the best of times. It hasn’t been able to benefit from the Narendra Modi government’s latest thrust on defence.
The government tweaked the contours of the longpending defence deal for 126 Rafale fighter planes from Dassault Aviation, of which 108 were to be made by HAL in India, to directly purchase 36 aircraft from the French company. More recently, the government cleared a Rs 11,930 crore joint bid by Airbus and Tata Advanced Systems for making Avro (transport aircraft).
HAL has also been beset by accidents involving the Russian Sukhoi SU-30MKI warplanes that it has been assembling for several years. The latest crash happened in October near Pune and led to a grounding of all the planes in India. Given the circumstances, T Suvarna Raju, who took over as HAL chairman in January, has a tough task on his hands.
Raju joined HAL in 1980 and is credited with securing the first patent for the firm in January 2002. Anirban Chowdhary caught up with him at the Paris Air Show for an interview, in which he spoke about his views on Make in India, competition from private companies and whether HAL needs a makeover. Edited excerpts:
What do you think of Make in India campaign and the thrust on defence?
HAL has been there for the past seven decades. The Make in India campaign has started recently. We have been doing that all along: giving unstinted support to the armed forces. This is the reason for which government has created HAL. We are living up to the expectations of the people and the government Make in India makes sense in the defence sector which sees the biggest import of equipment. The PM’s thrust in this direction will make sure we are more self-reliant.
You said HAL is living up to the expectations of the government. Why did it lose out on two mega deals recently, Dassault and Airbus-Tata?
About the Rafales yes, there were discussions earlier (of HAL’s prominent role in the deal), but for the best interests of the nation, the government decided to directly acquire 36 aircraft in the initial setting.
Regarding the selection of the Airbus-Tata consortium for Avro jets, that was already known to us. A year ago or before, at the RFQ (Request for Qualification) stage itself, HAL was told the government would try to see how the private industry would react to it. Defence is a huge industry and the capital required is very high. So the process initiated is good and we hope things will turn out well.
Don’t you think private companies are stealing a march on HAL? Also, does HAL hope to get a pie out of the Dassault deal, when it is signed?
Acquisitions and direct procurements have always been there. The government acquired 50 odd Mirage 2000s in the 1980s. And then we maintained them. That’s where HAL steps in.
Possibly, Rafales will also need maintenance and HAL wouldn’t be out of place to provide maintenance support to the aircraft. Some percentage of it will be with the frontline. The Air Force will do that. But there is an industrial support required and that’s where we come in.
Do you think the private players will be committed to the defence sector in the long run?
We have to see how the private companies perform. It is not that many companies with expertise in aviation will be created overnight. You can’t sell a product and close your shop. The real job starts after selling the product.
You need to support the product for 30-40 years. The number of purchases is limited right now and the margins (on support) will be very low. Unless these companies do their research and increase their product portfolio, it may not be very economically attractive.
What about HAL’s own projects? What can we expect going forward?
We have mastered the art of rotary aircraft or helicopters. The Dhruv (utilitygovhelicopter) has proved its existence. Our next product will be the Light Combat Helicopter which will get operational clearance this year. The Light Utility Helicopter is also going to fly this year. We expect to get operational clearance by 2017. We are still working on the BAE Systems Hawk trainer aircraft. Sukhois will be produced for another four years. Another 60 aircraft are to be delivered yet according to the contract.
Do you think HAL needs an urgent makeover or upgrade?
Yes, we do feel the need. As technologies and customer expectations are changing, we also have to change our strategies to suit the requirements. You can’t be complacent that you are the only one. Ultimately, the customer who is using the product has to be satisfied and we have to do anything and everything that is required in that direction.
The government tweaked the contours of the longpending defence deal for 126 Rafale fighter planes from Dassault Aviation, of which 108 were to be made by HAL in India, to directly purchase 36 aircraft from the French company. More recently, the government cleared a Rs 11,930 crore joint bid by Airbus and Tata Advanced Systems for making Avro (transport aircraft).
HAL has also been beset by accidents involving the Russian Sukhoi SU-30MKI warplanes that it has been assembling for several years. The latest crash happened in October near Pune and led to a grounding of all the planes in India. Given the circumstances, T Suvarna Raju, who took over as HAL chairman in January, has a tough task on his hands.
Raju joined HAL in 1980 and is credited with securing the first patent for the firm in January 2002. Anirban Chowdhary caught up with him at the Paris Air Show for an interview, in which he spoke about his views on Make in India, competition from private companies and whether HAL needs a makeover. Edited excerpts:
What do you think of Make in India campaign and the thrust on defence?
HAL has been there for the past seven decades. The Make in India campaign has started recently. We have been doing that all along: giving unstinted support to the armed forces. This is the reason for which government has created HAL. We are living up to the expectations of the people and the government Make in India makes sense in the defence sector which sees the biggest import of equipment. The PM’s thrust in this direction will make sure we are more self-reliant.
You said HAL is living up to the expectations of the government. Why did it lose out on two mega deals recently, Dassault and Airbus-Tata?
About the Rafales yes, there were discussions earlier (of HAL’s prominent role in the deal), but for the best interests of the nation, the government decided to directly acquire 36 aircraft in the initial setting.
Regarding the selection of the Airbus-Tata consortium for Avro jets, that was already known to us. A year ago or before, at the RFQ (Request for Qualification) stage itself, HAL was told the government would try to see how the private industry would react to it. Defence is a huge industry and the capital required is very high. So the process initiated is good and we hope things will turn out well.
Don’t you think private companies are stealing a march on HAL? Also, does HAL hope to get a pie out of the Dassault deal, when it is signed?
Acquisitions and direct procurements have always been there. The government acquired 50 odd Mirage 2000s in the 1980s. And then we maintained them. That’s where HAL steps in.
Possibly, Rafales will also need maintenance and HAL wouldn’t be out of place to provide maintenance support to the aircraft. Some percentage of it will be with the frontline. The Air Force will do that. But there is an industrial support required and that’s where we come in.
Do you think the private players will be committed to the defence sector in the long run?
We have to see how the private companies perform. It is not that many companies with expertise in aviation will be created overnight. You can’t sell a product and close your shop. The real job starts after selling the product.
You need to support the product for 30-40 years. The number of purchases is limited right now and the margins (on support) will be very low. Unless these companies do their research and increase their product portfolio, it may not be very economically attractive.
What about HAL’s own projects? What can we expect going forward?
We have mastered the art of rotary aircraft or helicopters. The Dhruv (utilitygovhelicopter) has proved its existence. Our next product will be the Light Combat Helicopter which will get operational clearance this year. The Light Utility Helicopter is also going to fly this year. We expect to get operational clearance by 2017. We are still working on the BAE Systems Hawk trainer aircraft. Sukhois will be produced for another four years. Another 60 aircraft are to be delivered yet according to the contract.
Do you think HAL needs an urgent makeover or upgrade?
Yes, we do feel the need. As technologies and customer expectations are changing, we also have to change our strategies to suit the requirements. You can’t be complacent that you are the only one. Ultimately, the customer who is using the product has to be satisfied and we have to do anything and everything that is required in that direction.
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