Indian Private Defence Sector

[Bhartiya Sainik]

After AMCA, will the next satisfactorily "Advanced" fighter, hopefully next-gen, hopefully multi-role, hopefully highly survivable, hopefully globally competing, come from Private Sector?
Can Tata, Reliance, Adani, etc assemble a team of IITians, NITians & experienced professionals & challenge ADA+DRDO+HAL?
Same thing for Army & Navy too.

 

[Hari Sud]

The private sector wants government money to play together with free land and water and low interest loan as working capital then only they will enter the defence sector. That is too much to ask…..

 

[fire starter]

View: https://x.com/AdithyaKM_/status/1886234199742623933?t=BV2pzhmqLqnBkcXs3Hb89w&s=19

 

[ezsasa]

View: https://x.com/AdithyaKM_/status/1886234199742623933?t=BV2pzhmqLqnBkcXs3Hb89w&s=19

after this phase of drone technology demonstrations are thru, doesn't it make sense that forces take a call on standardising ejector racks across the board for all drone munitions?

would be one less variable for future drone munitions designers, else each vendor will be coming up with their own rack design specific to their own munitions.

unlike other A2G munitions, there is no foreign global MIL-SPEC that needs to be adapted to in this case.

 

[Bhartiya Sainik]

The private sector wants government money to play together with free land and water and low interest loan as working capital then only they will enter the defence sector. That is too much to ask…..

To some extent w.r.t. land, that has already happened. AFAIK, at least Tata, Reliance have got not just land but also hangars up & running beside airport(s) already. If we take example of MIHAN (Multi-modal International Hub At Nagpur), we can see how big area has been alloted already for those industries adjacant to the airport.
Such could be the case at some other airfields also across the country, IDK.
Although these are for civillian/passenger/cargo aircrafts, but the START has already happened.





Now the question is of money. No country's govt. allows private firms to independently sell weapons abroad for obvious reasons.
Our private companies don't wan't to loose money in competition like Lockheed Vs Northrop Vs Boeing. Many big companies got sold out like McDonnel Douglas, etc.
(https://en.wikipedia.org/wiki/Category:Former_defense_companies_of_the_United_States)
(https://en.wikipedia.org/wiki/Category:Defunct_aircraft_manufacturers_of_the_United_States)
So the best solution could be joint partnership in design, production, performance, risk, accountability, profit, export, etc.

 

[Ayan Barat]

The private sector wants government money to play together with free land and water and low interest loan as working capital then only they will enter the defence sector. That is too much to ask…..

Things are in no way as nuanced as you're saying Sir. They're are extremely straightforward, working on pretty much the Darwinian principle of survival of the fittest. If government run companies will lag behind then they'd be mercilessly massacred by private players and vice-versa.

Below are two 0.32ACP pistols.
One of these is made by a 200 years old government run company that get money allocated to it every year in budget and had crores in revenue. Other one is made by a small firm, headed by a single Chap about whom no-one knew anything a couple of years back.

 

[Baseplate]

View: https://www.reddit.com/r/diyelectronics/comments/1ffjpc1/repairing_peltor_comtac_xp_internal_cabling_has_3/?utm_source=embedv2&utm_medium=post_embed&utm_content=whitespace

All the tech inside a pair of peltors ,

if indian companies can't make even this , its so over

 

[Ayan Barat]

View: https://www.reddit.com/r/diyelectronics/comments/1ffjpc1/repairing_peltor_comtac_xp_internal_cabling_has_3/?utm_source=embedv2&utm_medium=post_embed&utm_content=whitespace

All the tech inside a pair of peltors ,

if indian companies can't make even this , its so over

Most of time I yap about tech and manufacturing so let's dabble a bit in economics today

Why do we buy a certain product instead of any of its competitors?

Most of the times we buy something because there's a value proposition to it. Where it provides
• same value as others but at reduced cost; or
• comparatively more value at a close price.

We can definitely make something like this but the more important question is would we be able to exploit any of the above propositions?

• Whoever takes the initiative gets a first mover's advantage which ultimately translates to economies of scale resulting in them making their products extremely cost effective. And this deters new entrants as they can't compete by providing the same values as their cost would be too high because they need to account for their fixed cost too, which older firms have amortized long ago and now more or less just needs to bother about the variable cost.

• So providing same value at a lower cost is not possible hence the only option left is providing more values at a slightly more cost. This can be done in two ways; one, you make the customer think that you're providing more values by using gimmicks. This is something you'd find in mid-range smartphone category where they use all kind of gibberish like "Beast Mode 2.3/UltraCool/69MP camera" to differentiate their phones from the competition because at its core a FakeMe and a BlueMi are pretty much the same value at the same cost. But these don't work much in aerospace and defence where everything is judged on their performance and not gimmicks, so here comes the second way; innovation. You try to come up with something so radical that it "breaks" the cost-value proposition.

tl;dr: If I try to match the price of this ComTac then my quality would suffer and if try to match its quality then my price would rise. Only way to best this paradox is if I innovate something that lets me drive down the price drastically compared to the quality or something that's groundbreaking in terms of technology like say a bone conducting ComTac with active noise cancellation.

 

[Hari Sud]

View: https://x.com/AdithyaKM_/status/1886234199742623933?t=BV2pzhmqLqnBkcXs3Hb89w&s=19

Has Indian Army purchased these in large numbers or are testing like crazy to dump it in favour of imports?

 

[RDXChauhan]

View: https://x.com/amanroutray7/status/1886462283322372289?t=s2sUigjAFELzryK6bQa02g&s=19

 

[Cyclops]

Most of time I yap about tech and manufacturing so let's dabble a bit in economics today

Why do we buy a certain product instead of any of its competitors?

Most of the times we buy something because there's a value proposition to it. Where it provides
• same value as others but at reduced cost; or
• comparatively more value at a close price.

We can definitely make something like this but the more important question is would we be able to exploit any of the above propositions?

• Whoever takes the initiative gets a first mover's advantage which ultimately translates to economies of scale resulting in them making their products extremely cost effective. And this deters new entrants as they can't compete by providing the same values as their cost would be too high because they need to account for their fixed cost too, which older firms have amortized long ago and now more or less just needs to bother about the variable cost.

• So providing same value at a lower cost is not possible hence the only option left is providing more values at a slightly more cost. This can be done in two ways; one, you make the customer think that you're providing more values by using gimmicks. This is something you'd find in mid-range smartphone category where they use all kind of gibberish like "Beast Mode 2.3/UltraCool/69MP camera" to differentiate their phones from the competition because at its core a FakeMe and a BlueMi are pretty much the same value at the same cost. But these don't work much in aerospace and defence where everything is judged on their performance and not gimmicks, so here comes the second way; innovation. You try to come up with something so radical that it "breaks" the cost-value proposition.

tl;dr: If I try to match the price of this ComTac then my quality would suffer and if try to match its quality then my price would rise. Only way to best this paradox is if I innovate something that lets me drive down the price drastically compared to the quality or something that's groundbreaking in terms of technology like say a bone conducting ComTac with active noise cancellation.

Or...

• The government creates an all-stakeholders-coordinated-national-mission for the purpose of R&D, innovation and mass-production for every such system and subsystems.
• Subsidizes and synergizes cooperation between academia, R&D and certification institutions, military and all industries.
• This helps public & private companies to get as close to the established players as possible.
• After all that, the price may still be a tad higher, but the government "urges" the military to adopt said indigenous systems, despite the latter's "countervailing opinions". And seeing as how "some militaries" don't even spend the entirety of their allocated budget every year since donkey's years, they should develop or be "urged to develop" some institutional-responsibility to foster domestic military-industry.
• Over a period of time, these industries evolve, achieve said amortization, economies of scale and innovate on their own to both keep a nation's military well equipped and also stay ahead of their competitors.

The US military keeps buying, overhauling and updating F-15s, Abrams, etc basically indefinitely so as to not collapse their "fight tonight" credo and also coz they know, production lines need to run both fast and long. This is because military-industry like other industries suffers from a 'use it or lose it' phenomena, i.e. one can't just buy a handful of Arjuns, stop the production line and hope that the next time IA wants the FMBT, the Arjun lines can be refired and the production quality and rate will be the same as during Arjun. Knowhow, talent and tech are lost during this hiatus.
Lekin kya bataeein hamaare afsar sahaabon ko...
Kuch sawaal pucho toh, "bloody civilians" jawaab ayega.

Large militaries cannot survive without a DOMESTIC military-industrial base; and consistent-purchase, competition, subsidisation and protectionism is absolutely necessary for national defence in the long term.

That is more or less how US did it.

 

[Ayan Barat]

The government creates an all-stakeholders-coordinated-national-mission for the purpose of R&D, innovation

23 IIT, 7 IISCR and a IISC...the so called Institutes of National Importance are already there.

Subsidizes and synergizes cooperation between academia

That's not Government's job, it's a simple process of academia coming up with good patents and military buying those.

University of Florida made Gatorade, it was good so they got millions of dollars in royalty...did the POTUS feel the need to intervene and subsidize?

the government "urges" the military to adopt said indigenous systems

Already done...it's more or less what "Positive Indigenization List" is concerned with.

innovate on their own

There's a small firm by the name BEL, don't know whether you've heard about them or not but they're the og of our country. Almost all of their radar portfolio comes from foreign or DRDO's technology transfer. Tell me how much have they managed to innovate after absorbing these technologies for years?

It's a government run PSU, bloated, worker's union, strike blah blah blah...leave it; let's talk private firms. Tata, Adani, Mahindra, L&T...which one has managed to make something radically improved by combining all the different technologies they've had ToT of? Tata is making C-295 right? Quote the number of years it would take Tata to make a similar plane in-house, based on the experience of C-295.

 

[shade2]

There's a small firm by the name BEL, don't know whether you've heard about them or not but they're the og of our country. Almost all of their radar portfolio comes from foreign or DRDO's technology transfer. Tell me how much have they managed to innovate after absorbing these technologies for years?

It's a government run PSU, bloated, worker's union, strike blah blah blah...leave it; let's talk private firms. Tata, Adani, Mahindra, L&T...which one has managed to make something radically improved by combining all the different technologies they've had ToT of? Tata is making C-295 right? Quote the number of years it would take Tata to make a similar plane in-house, based on the experience of C-295.

Everything with "Bharat" here and the Garuda & Marg truck mounted artillery is IDDM by Kalyani



Please tell me how many orders have been placed by Import Bahadurs

ATAGS will only get orders for 307 pieces only because Govt arm-twisted the Bahadurs to buy even that sum

Now tell me if you were a suit-booted dhandho, after seeing the absolute fuck all interest in Baba Kalyani's wares by the uniformed class, what action would you take to ((( increase share holder value ))) ?

Go for the proven and profitable giri with foreign vendor
OR
Burn countless crores of your budget on AaR aNd DeE to produce some of the good sht that only Armenia will buy 20 pieces of?


Private sector and DPSUs are all in the same boat, whatever they make, however good it is, the ((( users ))) will always prefer imports, even if they are from South Africa or Ukraine

You yourself keep on bringing in the argument of "AK203 being chosen over Trichy AR", you should know what is the benefit of rolling your own/ cloning-and-upgrading-something vs just doing

 

[Ayan Barat]

Everything with "Bharat" here and the Garuda & Marg truck mounted artillery is IDDM by Kalyani

Kabhi "Mandus Group" ka naam nahi suna hai kya Babu? Achha chhodo wo sab, ye batao ki "Noricum" kya hai?

 

[shade2]

Kabhi "Mandus Group" ka naam nahi suna hai kya Babu? Achha chhodo wo sab, ye batao ki "Noricum" kya hai?

Still point stands, why do R&D when nobody will give a shit, just tie up with foreign vendor and do
There's no incentive here to do anything beyond

The question is not
>"Why dhandhos and DPSUs don't innovate and upgrade existing or R&D new stuff"

but
>"Why should dhandhos and DPSUs bother to innovate and upgrade existing or R&D new stuff"


Even DRDO projects have to be pushed through by Govt arm-twisting mostly, there are some exceptions like Dhruv.

Like you've even compared some OFB clone pistol vs one made by some Astr Defence, you really think the ((( users ))) will even buy that?
The phantom pistol wala's business will go under since he won't get the large orders necessary, doesn't matter how good his product is.

 

[Azaad]

Kabhi "Mandus Group" ka naam nahi suna hai kya Babu? Achha chhodo wo sab, ye batao ki "Noricum" kya hai?

That's immaterial. Kalyani put money from its own pocket to buy out a Swiss firm RUAG & with it the entire tech & IPR of field guns WITHOUT any guarantee whatsoever of any order. Ditto for tech from Mandus Group. Here's an interview of Baba Kalyani all the way back from 2015 explaining his strategy .

Kalyani Strategic Systems will not wait for defence orders, says Baba Kalyani

Business Today speaks with talks Kalyani Group Chairman Baba N. Kalyani about the stop-and-start nature of the defence business and what needs to change in the government's procurement policy. - Issue Date: Apr 26, 2015

www.businesstoday.in

The principal remains. What's Kalyani got to show for all the investment it has made in this area apart from the development undertaken in this regard ? The ATAGS order has been languishing since 2022 if I'm not mistaken & let's not even get into the numbers . Ditto for the WhAP program .