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India’s largest state-owned defence electronics firm, Bharat Electronics Limited (BEL) has drawn up plans to formalize joint ventures with Indian and global firms to accelerate its business and double its revenues to $2 billion in three years.
With increased proliferation of private firms in the defence sector, BEL is pulling up its socks and intends to augment its business by focusing on critical technologies which can increase its business potential.
Currently, BEL is facing stiff competition by private majors like the Tata Group and others like Rolta India Limited, Alpha Design Technologies and Astra Microwave Products Limited who are bagging orders of radars and electronic warfare system which have been the domain of BEL.
It is also facing underutilization and the turnover at six of its 19 strategic business units is low because of technology that has become obsolete.
Hence, the focus on advanced technology has become a priority for BEL with the changing defence sector scenario in India.
Another setback has been the issue of one of the largest defence contracts which has been thrown open to the private sector.
India has decided to let private firms bid against BEL for a $ 1 billion project aimed at modernizing the Indian Army’s tactical communication system.
This was revealed in June 2009 and the tender is to be issued soon.
BEL has identified various sectors which will need focus and these include missile electronics, guidance systems, microwave components, electro-optics, homeland security, coastal surveillance systems and airborne electronic warfare systems as focus areas to tap the opportunity.
Besides, BEL also specializes in electronic communication equipment including transmitters, receivers, microwave radio relays and radars as well as night vision equipment such as binoculars, and periscopes and gun sights.
BEL officials said although private sector involvement is giving BEL stiff competition, BEL has charted its future course of action and has won new orders for radars and electronic warfare systems of $680 million in recent months, and is expecting its total orders to touch $2.4 billion this year.
Despite the entry of private firms, BEL is expected to gain from increased defence capital expenditure and the offset policy.
BEL is also holding talks with Thales Group of France, MBDA Italia, Israel’s Elbit Systems Ltd and Rafael Advanced Defense Systems Limited, Israel Aerospace Industries Limited and India’s Astra Microwave for possible joint ventures that will help bridge the gaps in technology.
The firm also has pacts to build simulators with Boeing.
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