Financial Daily from THE HINDU group of publications
Friday, Sep 05, 2003
Industry & Economy
Logistics - Airlines
HAL sees major spin-offs from AJT deal
Bangalore , Sept. 4
THE decision to buy the AJTs (advanced jet trainers) is "good news" to Hindustan Aeronautics Ltd (HAL) too, probably as much as it cheers the IAF.
The AJT spells rich dividends as HAL will get to manufacture 42 of the 66 Hawk 115Y AJTs under licence from British Aerospace Systems in the coming years. It will also get part of the Rs 2,000-crore budget to upgrade ground systems.
According to the Chairman of HAL, Mr N.R. Mohanty, the AJT deal will mean a big manufacturing and technological opportunity to the defence PSU, though second only to the Su-30 fighters manufacturing deal that was struck only a couple of years ago.
There will be major spin-off benefits like acquisition of new technologies from BAE Systems. The IAF will also depend on it for repair and overhaul, Mr Mohanty told Business Line.
"This is good news for HAL. We will have plenty of work as 42 of the jets will be manufactured here. The schedule and the finer details of the deal are yet to be worked out, but HAL will be involved in making critical systems like the airframe, engine and accessories." BAE Systems is coordinating with the makers of these accessories, he said.
Each AJT is estimated at Rs 85 crore and BAE will supply the first 24 jets from its Brough, East Yorkshire site within three years of inking the pack and complete the transaction in six years.
"As HAL will do 80 per cent of the manufacturing, it will acquire new technologies like the directionally solidified blades, which will give us the technology for the future engines. Similarly, from the Sukhoi (Su-30 fighter deal) we acquired the single crystal blade technology, which will be the basis for all future turbine blades. This way, we get to master these technologies and meet our own requirements and exports, which is the thrust at HAL," Mr Mohanty said.
There will not be much of capital investment as most of the infrastructure is already available at its Bangalore facility. The Hawk is powered by the Adour 871 engine from Rolls Royce-Turbomeca. HAL is already is assembling the Adour 811 version that is similar to it at the Bangalore facility for IAF's Jaguar fleet since 1979.
HAL also plans to share its additional workload with the private sector as part of its philosophy to increasingly outsource non-core activities from the industry. To ensure quality, HAL engineers would be deputed to work onsite with private partners.
The IAF first sought AJTs in 1984 for stage 3 training of its pilots and the Cabinet Committee on Security plumped for the Hawk on Wednesday, ending one of the biggest defence suspense in recent times. The lack of an AJT has also cost over 300 MiGs and their pilots in crashes and an estimated loss of Rs 12,000 crore to the exchequer.
Meanwhile, HAL is pushing ahead with the intermediate jet trainer (IJT). The first prototype has completed 36 flights since it first took wings in March this year.
"We are moving very fast and expediting the second prototype. It should fly by December this year and get its certification by the end of 2004. We hope to make the delivery by 2005," Mr Mohanty said.
Stories in this Section
The Hindu Group: Home | About Us | Copyright | Archives | Contacts | Subscription
Group Sites: The Hindu | Business Line | The Sportstar | Frontline | The Hindu eBooks | Home |
Copyright © 2003, The
Hindu Business Line. Republication or redissemination of the contents of
this screen are expressly prohibited without the written consent of
The Hindu Business Line