On the Move!
The fact that we have created JVs in India is a visible indication that we are anticipating a continued growth in this sector, says Eli Hafets, Regional Director, India at Rafael Defense Systems Ltd
"Rafael has been more than willing to create structures to ensure technological transfer to India, and has to-date created two joint ventures in diverse fields to support ‘Make in India’ initiatives of the Government," says Hafets
Briefly tell us about the journey of Rafael Advanced Defence Systems Ltd. in India till now. How satisfied are you with the progress so far?
Rafael Advanced Defense Systems Ltd. designs, develops, manufactures and supplies a wide range of high-tech defence systems for air, land, sea space and cyber applications for the Israeli Defence Forces and the defence establishment, as well as for customers around the world. The company offers its customers a diversified array of innovative solutions at the leading edge of global technology, from underwater systems through naval, ground, and air superiority systems to space systems.
Rafael prides itself in being able to create partnerships with international leading aerospace and defence companies overseas. Over 100 offset activities and industrial cooperation have been set up with over 20 countries worldwide.
India is an important client given the strategic nature of ties between the two countries. Rafael has been present in India since the late 1990s and has continued to supply sophisticated weapon systems to the Indian MOD. Given the current trends in the Government, Rafael has been more than willing to create structures to ensure technological transfer to India, and has to-date created two joint ventures in diverse fields to support ‘Make in India’ initiatives of the Government.
How’s been the business in the ongoing fiscal and how would you compare it to last year’s performance?
The Covid-19 pandemic places a hurdle in progressing programs not only in India, but with most other countries, even ones which have been in the pipeline and in some cases nearing fruition. As we are still just halfway through the year, it is rather complex to predict the eventuality of this year’s results, particularly due to the circumstances prevailing globally, which are certain to have an effect on business. Having said that, we are carrying on as planned and on schedule, and we are optimistic that once the situation stabilises, we will be back on track to complete pipeline business activities and make further progress on ones that have slowed down. As this is happening, we remain on-the-move, researching, developing, keeping in close touch with our partners and customers around the world, and looking forward to a resumption of personal engagement with our Indian partners.
Since defence manufacturing is a niche segment, has it been challenging to find the right talent in India? Do you have in-house training infrastructure and programmes to address this issue?
We are very satisfied with the high level of engineering teams in India, while successfully absorbing the technology and creating value and synergy with our Projects and R&D Teams. As mentioned we have two joint ventures created in India. These JVs have been trained in the equipment and processes that are the baseline for Rafael. Currently, these have been done with the team from Rafael, Israel, but we continue to train the teams in these technologies as newer inductions happen. This is a combination of in-house and external training. India has very talented manpower and with the training that we provide, we are certain that both Rafael and the local economy will reap substantial benefit from this win-win cooperation.
How has the Covid-19 outbreak affected the operations of Rafael Advanced Defence Systems Ltd. in India and how are you dealing with the same?
Despite the challenges limitations posed by Covid-19, we continue to work in supporting India’s defence programs as best as can be done remotely, in full cooperation with the Indian MOD to address its needs, and fulfil its operational requirement, with the support of our local JV’s.
Tell us about your joint ventures and collaborations in India and what are some of the key projects that you are currently working on for the Indian armed forces?
Rafael continuously works to form JV’s and industrial cooperation in line with the Make-In-India Policy. Rafael has been working steadily to create Technology Partnerships or Joint Ventures with major Indian companies to address various projects and has created structures to ensure technological transfer to India, which will also serve as an important pillar in propelling India to be part of a global export supply chain.
Over the last few years, Rafael has continued to realise its commitment to the Indian market and to its economy, including last summer’s inauguration of a state-of-the-art facility at Hardware Technology Park, Hyderabad as part of its JV with Astra Microwave that has yielded ARC (Astra Rafael Company), for local manufacturing of the SDR BNET communication system for the Indian Air Force, with a US$30 million purchase order and Electronic Warfare (EW) systems to be provided to all services. In addition, RAFAEL has placed a US$100 M Order for MRSAM missile kits for the Indian Army and Air Force from KRAS (Kalyani Rafael Advanced Systems Ltd. India).
This, among other steps, is part of Rafael’s compliance with the “Make-in-India” policy of the Indian government and is testimony to Rafael’s global commitment to local production, knowledge transfer and industrial cooperation.
Tell us something about the manufacturing capabilities and capacities in India.
Our supply chain in India is supported by more than 100 vendors, most of them are MSMEs that have been trained and qualified to supply parts of our systems. Private companies are willing to make more investments for the future to come. We believe that based on local contracts within India, the same supply chain can support export activities from India.
How would you analyse the ‘Make in India’ initiative in the context of your industry?
Rafael is committed to supporting ‘Make in India’ initiative and has therefore invested in Indian Joint Ventures as elaborated in the previous questions. We at Rafael, with our advanced technologies, are willing to continue supporting this through our investments in Defence companies.
How do you see the defence manufacturing sector in India growing in the next two years?
The fact that we have created JVs in India is a visible indication that we are anticipating a continued growth in this sector. The scale of the growth is best commented upon by the Govt of the day, but we certainly believe that there is considerable scope for improvement. This fact has been acknowledged by many professionals in the field. The 74 percent FDI (Foreign Defence Investment) increase, although not new, will facilitate the procedure through the automatic route, to all those who consider an investment in the Indian market. One of the growth factors may be exports, and to that effect we are looking at some overseas opportunities with our local partners based on systems and solutions offered to Indian Armed forces.