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Reliance Infra-Dassault Aviation set up Joint Venture
Oct 27, 2016

In a major deal for India's private defence industry, Anil Ambani-led Reliance Group and Rafale maker Dassault Aviation announced a joint venture (JV) that will be a key player in execution of offset contract worth about Rs 22,000 crore as part of the fighter jet deal.

  • The announcement of the JV, Dassault Reliance Aerospace, comes after the deal between India and France, signing an agreement for 36 Rafale fighter jets at a value of Euro 7.87 billion (Rs 59,000 crore).
  • The agreement includes a 50% offset obligation, the largest-ever offset contract in the history of India.
  • The main point of the offset agreement is 74% of it has to be imported from India, which means direct business worth around Rs 22,000 crore.
  • The offset, spread over seven years, will be finalised soon.
  • There is also a technology-sharing component, which is being discussed with the Defence Research and Development Organisation (DRDO).
  • Other companies involved in the Rafale deal include French firms MBDA and Thales, besides Safran, which too will be part of the overall offset obligation.
  • He Dassault Reliance Aerospace joint venture will be a key player in the execution of offset obligations, a joint statement by the companies said.
  • The development has come as a boost to the Reliance Group, which entered the defence sector only in January 2015.

This new joint venture called Dassault Reliance Aerospace will support Make in India and Skill India policies and develop major Indian programmes with high levels of technology transfer to benefit the entire aerospace sector.

The proposed strategic partnership between Dassault and Reliance will also focus on promoting research and development projects under the IDDM programme (Indigenously Designed, Developed and Manufactured).

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