For the first time ever, L&T is going to export ships to the South East Asian countries and with the new DPP Policy of the government, L&T is expecting significant growth orders on the defence side.
L&T's plans also coincide with PM Narendra Modi's "Act East" policy.
Steering this initiative along with company's domestic and international defence sector plans is L&T's Senior Vice President, Head of Defence & Aerospace, Jayant D Patil.
An alumnus of IIT-Bombay, Patil is responsible for the entire defence and aerospace strategic business sectors of L&T.
In an exclusive interview, Patil divulges details on L&T's export plans and the type of ships they will be exporting
Q: How has the journey been so far? Did you face any bottlenecks as far as DPP policy is concerned?
A: At L&T, we have been building solutions in-house and have been looking at select export opportunities for some time. Wherever we looked at an export opportunity, one limitation we saw was that we needed complete end-to-end solution to create unique value-additions. That necessarily meant that if you look at any platform technology, we did not have 100% platform solutions in-house. For example, if we decided to offer somebody an anti-submarine warfare capability, we needed to import a weapon for want of indigenous products. Now how do I import weapons or sensors in this country and re-export and get export permissions?
Today with the change in policies leading to easing and expeditious clearances of the export applications, this has been made possible.
Q: What kind of solutions are you looking at?
A: So, one can look at something like a "Brahmos" subject to specific clearances. These are end-to-end integration solutions, which we have matured while working with our armed forces for 20 years in India.
Today, we can architect such complete solutions and integrate them on ships backed by policies. We are actually working out with few countries, and in next six months, we expect to make an announcement that we have actually sold ships and modernisation solutions to at least one friendly nation. Today, we do just about 150 crore a year in export sales, even this is not small as most Indian companies don't do that much as annual sales in defence.
Q: What about the exporting ships to Vietnam?
A: This is one serious opportunity being pursued and is under discussions. While we look forward to expeditious conclusion, we will have to wait for formal announcements.
Q: How do you see your company's overall exports growing on the defence side?
A: I see it growing over years to come. We believe that this is aligned with the government's plans and agenda of Make in India for export and expect the government's support in growing exports in this sector. All defence exporting nations do this and India cannot be an exception. We have not put numbers to our export targets. Maybe in a couple of months, I should be able to share some numbers with you.
Q: What kind of ships you will be exporting?
A: First that we built were small ships, which were essentially interceptor boats. The difference is that these are designed in-house at our ship design centre to compete in Buy Global RFP conceptualised post 26/11 Mumbai attacks to outrun and catch anyone in sea.
We have developed an amazing solution, we have a ship that can do 90-100 Kmph in water and nobody in India has ever done anything of this kind. We won the global RFP and are building 54 for Indian Coast Guard. These are built at our Hazira as well as Katupalli shipyards. We are currently building OPVs for Coast Guard and Floating Dock for Indian Navy, all designed in-house.
Q: What are your expectations from the defence ministry?
A: Going forward, we expect the MoD to give larger warships to us and not only to the MoD shipyards, whom we work with as Tier1 to built and install weapon systems, platform specific engineering systems and logistics solutions. We believe that this will see us build requisite track record for exports across platforms as well as systems.
Today, submarines are there around the corner, you'll see the artillery guns getting concluded in the near future, we see that the communication suite will mature in the next 2 to 3 years and in the fourth year we will start having some revenues on that, FICV development about to begin. We have also developed a wall penetrating and ground penetrating radars that reveal what is going on across the wall and see mines buried underground.
So in about next few years, we would have moved ahead of others not only in India but also target exports. These capabilities and track record has been built leveraging L&T's own R&D investments and using indigenous knowledge.