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India Allows ‘Private Firms’ To Bid For INR 21,000 Defence Contract

The Defence Ministry will allow private companies to participate in the bidding process for new naval utility helicopters valued at 21,000 crore rupees. The Defence Ministry’s contract is part of the strategic partnership project under “Make in India” initiative. 

The experts emphasised saying, ” the first ‘expression of interest’ (EoI) to the private sector under the policy will be issued for the helicopter deal in the coming days while others like a mega plan to manufacture submarines, main battle tanks, and fighter jets will be tackled later, based on how the pilot project goes through”.

The Ministry of Defence has settled several financial and technical parameters to finalise Indian companies that are appropriate for the bidding process. The bidding criteria is a net worth of at least Rs 800 crore, a minimum revenue of Rs 1,800 crore and a sustained capability of delivering mega projects.

The companies taking part in bidding are expected to have experience of three years in handling defence production contracts. Another important criterion will be adequate land to set up the helicopter manufacturing plant.

“This will be a test case for the strategic partnership policy, which is a completely new process to select the private sector for major defence projects. A lot on other projects carries on how smoothly this goes and how issues that are bound to come up are tackled,” said Officials.

The Ministry of Defence will shortlist both Indian companies and foreign collaborators in a parallel process. The shortlisted companies will be asked to submit a joint commercial proposal and the lowest bidder would be declared the winner.

Last year, the Defence Acquisition Council (DAC) advocated the acquisition of 111 utility helicopters for the Indian Navy at a cost of over Rs 21,000 crore as the first under the SP model. “SP model envisages indigenous manufacturing of major defence platforms by an Indian strategic partner, who will collaborate with foreign OEM, acquire niche technologies and set up production facilities in the country,” said Ministry.

The Indian companies settled for bidding process included Mahindra Defence, Tata Aerospace and Defence, Adani Defence and Reliance Defence. Similarly, foreign companies like Airbus Helicopters, Sikorsky and Russian Helicopters. will also be issued an EoI to be the technical partner for the contract.

The naval utility helicopter contract has seen ups and downs in the past few months as the potential foreign bidder, Bell Helicopters has made it clear that it is not interested.

More News at EurAsian Times

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