Riding on Make in India wave Tata Motors wants to build battle tanks

The defence division of Tata Motors, the country's largest automobile maker, is eyeing Rs 60,000 crore of contracts to build combat vehicles. There is a silent race between companies to have the largest piece of the $100-billion worth of defence acquisitions laid out by the government over the next decade from local companies.

The company has bagged a Rs 914-crore contract to supply 1,239 indigenously developed high mobility multi-axle vehicles, the single largest order awarded by the army to an Indian private original equipment manufacturer in land systems under the Defence Procurement Policy.

Vernon Noronha, vice-president, defence and government business, Tata Motors, said: "In the past two years of the previous government, there were almost no orders. One year after the present government came to power, all our stuck files started moving and there was quick acceleration of orders. This has enthused not only Tata Motors but the entire industry."

The order book is Rs 1,500 crore, to be executed over the next two years. The division clocked revenue of Rs 1,200 crore last year and aims to double it in two years, Noronha added. In the past three years, the division generated revenue of Rs 2,000 crore or about three per cent of Tata Motors' total.

Indian companies are quickly building capabilities to grab a piece of the defence pie.

In two weeks, Mahindra & Mahindra (M&M) forged alliances with two European companies to supply underwater warfare equipment and military helicopters. The Anil Ambani-led Reliance Group entered the sector with the acquisition of Pipavav Defence.

"Earlier, RFPs (Request for Proposals) were issued at a snail's pace. Today, the Indian Army and ministry of defence are chasing companies, asking us to put our vehicles for trials as fast as possible," said Noronha.

The Rs 60,000-crore contract to build a Future Infantry Combat Vehicle is one of the biggest defence contracts of recent times. The previous government had floated an Expression of Interest (EoI) in 2008, after which eight private Indian companies responded. These had included Bharat Forge, Titagarh Wagons, M&M and Tata Motors. The Modi government scrapped the previous EoI and a revised one is expected in the next couple of months.

Beside, orders worth Rs 1,053 crore for the light armoured multipurpose vehicle, Rs 1,000 crore for armoured personnel carriers and Rs 3,000 crore for general service vehicles are being targeted by companies. A wheeled infantry combat vehicle is being built by Tata Motors in association with the Defence Research and Developent Organisation, of which the army is looking to procure 100 units.

"Eventually, we would like to become a manufacturer of light tanks and then the main battle tank. That is how we would like the progression to happen. The army released a request for information to develop the Future Ready Combat Vehicle, which will be the main battle tank. We have put in a response," added Noronha.