US: India's 49% FDI limit not enough for defence technology transfer, Jet engine technology

[ito]

It doesn't matter Mother company usually assemble the final products which are been sourced locally . There are over sime 200 more or less companies involved in Rafale

I was saying the motive behind 51%-49%. Anyway, what matters is what would bring foreign defense companies to India and government should make it easy for them to setup shops in India. If it means 100%, so be it.

 

[MilSpec]

provide exceptions to Sukhoi OKB, NPO saturn and work on getting the article 30 Engine.

 

[Ind4Ever]

I was saying the motive behind 51%-49%. Anyway, what matters is what would bring foreign defense companies to India and government should make it easy for them to setup shops in India. If it means 100%, so be it.

Of course

 

[Prajapati]

Agree with your point that India need put serious money in select projects, rather than putting little money in lot of projets thus dooming them all.

But one thing when people forget while comparing missiles with Engines is that like missiles, Kaveri worked! It just was not good enough to power even a LCA. The thing with missiles and rockets is that in order to succeed, they need to work; but for an engine to be successful , it need to work better than its competitors.

Not true. Even missiles are continuously improved upon carry more payload (MIRV etc) for lessor propellent (higher specific heat), increased accuracy and countermeasures. Nothing ever stops evolving as long as the competition/environment evolves.

If GoI is ready for 51%, then it should allow 74%.

50% is needed for normal executive decision while 75% is needed for changing mandate of the company. Thus putting limit at 51% does not make sense. After 49% ,next stop should be 74%.51% means that Indians would be investing 49% of their capital while enjoying benefits that come with 26% share holding.

If GoI will allow 51% then why not allow 100%

 

[scientien]

India should collaborate with Japan for aircraft engine. Both the countries don't have aircraft engine.

Absurd but legit

 

[Cry.me.a.River]

Not true. Even missiles are continuously improved upon carry more payload (MIRV etc) for lessor propellent (higher specific heat), increased accuracy and countermeasures. Nothing ever stops evolving as long as the competition/environment evolves.

But even when making those improvements, missiles of a country are not compared with missiles of other country. If a missile takes off and hit its target within margin of error, it is regarded as a success. No one cares and cribs that the missile is less fuel efficient than an American missile or that it carries only 3 MIRV while American/Russian carry 5; but in case of a jet Engine, you need to compare it with those available in market ,and even if you are ready to accept some loss in capability, it could not be grossly inferior to those available in market, else your aircraft would be under-powered thus compromising whole aircraft.

Making missiles and rockets is like sitting in boards exam where you have to get more than passing marks, while making an engine is equivalent to sitting in a competitive exam where you need to be better than your competition.This is the reason as to why it is easier to "succeed" in building rockets and missiles than engines.

If GoI will allow 51% then why not allow 100%

Between 49 and 100, there is one more stop of 74.

 

[Bussard Ramjet]

We need to fund Engine development by pouring 1 billion $ every year for the next 10 years and making that the highest priority mandate for DRDO in conjunction with private players. If DRDO can build Rockets and missiles under sanction, it will also build an engine giving enough funds and time. THAT is the way to go.

Rockets and missiles are far cheaper to build. Example: China.

They have an ICBM since 1980, and all kinds of rockets and missiles for decades, but are still struggling to create an engine.

 

[Prajapati]

But even when making those improvements, missiles of a country are not compared with missiles of other country. If a missile takes off and hit its target within margin of error, it is regarded as a success. No one cares and cribs that the missile is less fuel efficient than an American missile or that it carries only 3 MIRV while American/Russian carry 5; but in case of a jet Engine, you need to compare it with those available in market ,and even if you are ready to accept some loss in capability, it could not be grossly inferior to those available in market, else your aircraft would be under-powered thus compromising whole aircraft.

Making missiles and rockets is like sitting in boards exam where you have to get more than passing marks, while making an engine is equivalent to sitting in a competitive exam where you need to be better than your competition.This is the reason as to why it is easier to "succeed" in building rockets and missiles than engines.

Even aircrafts are not compared except by fan boys in forums. Most are designed to fit into a battle strategy or a strategy is built around them. They are played to their strengths and their weakness is compensated by tactics and alternate support. You can study how the US aircrafts and strategy evolved and how the russian aircraft's and strategy evolved.

The procurement system that has evolved has corrupted IAF into a spoilt brat for comparing aircrafts and deciding it wants only the best and nothing else. The evaluation they do is only technical, not strategic, tactical or economic. A rather short sighted and boorish way that is certainly not professional.

India first tested the prithvi missile in 1996, its 20 years and we are still evolving and testing a submarine launched 5000 km range missile. This in-spite of having a space rocket organization and launch from 1963.

so you can see, making a missile is no less complex, it only appears less complex because we have been so successful. Same holds true for aero- engines.

Between 49 and 100, there is one more stop of 74.

Its the philosophy behind the decision. 51% gives India Management control. Without that, how does it matter if its 49% of 0% or 26% ? India will have no management control. Then what is the point of this ? might as well purchase the engine at lower cost.

 

[Bussard Ramjet]

Sorry to be skeptical here, but I don't understand why anyone would be willing to share jet engine technology.

It is one of the most advanced things to do, and only a few countries are able to make reliable engines.

Not only this, engine sales are extremely lucrative and are at the top most end of the value chain. Why would someone create a direct competitor?

 

[Prajapati]

Rockets and missiles are far cheaper to build. Example: China.

They have an ICBM since 1980, and all kinds of rockets and missiles for decades, but are still struggling to create an engine.

That is because they put more focus on building rockets and not aero engines.

Consider UK, they put more focus on building aero engines than Rockets.

Sorry to be skeptical here, but I don't understand why anyone would be willing to share jet engine technology.

It is one of the most advanced things to do, and only a few countries are able to make reliable engines.

Not only this, engine sales are extremely lucrative and are at the top most end of the value chain. Why would someone create a direct competitor?

What is the point of being at the top of the value chain if there are no buyers ?

 

[Bussard Ramjet]

That is because they put more focus on building rockets and not aero engines.

Consider UK, they put more focus on building aero engines than Rockets.



What is the point of being at the top of the value chain if there are no buyers ?

Why are there no buyers? There are huge, incredible number of buyers.

Jet Engines from what I hear have heavy profit margins, and sustain thousands of extremely high paid jobs. That is extremely extremely highly technical and skilled jobs.

And the market for Jet Engines is exploding.

 

[Prajapati]

Why are there no buyers? There are huge, incredible number of buyers.

Jet Engines from what I hear have heavy profit margins, and sustain thousands of extremely high paid jobs. That is extremely extremely highly technical and skilled jobs.

And the market for Jet Engines is exploding.

Top of the line engines are Pratt & Whitney F119 with 160 KN Thrust. Their sale is banned by the US govt. That was the point, was it not ?

 

[Bussard Ramjet]

Top of the line engines are Pratt & Whitney F119 with 160 KN Thrust. Their sale is banned by the US govt. That was the point, was it not ?

I am sorry I didn't get.

And anyways, there are still enough buyers of F119 within the US defense establishment.

Also, I remember reading an interview of a Boeing engineer, who said that almost all profits are derived from civil airplanes. The military airplanes and parts are under serious restrictions from the Government, and often the money from the civil airplanes is used to fund research for military.

So we should just see the total jet engine market.

 

[Prajapati]

I am sorry I didn't get.

And anyways, there are still enough buyers of F119 within the US defense establishment.

Also, I remember reading an interview of a Boeing engineer, who said that almost all profits are derived from civil airplanes. The military airplanes and parts are under serious restrictions from the Government, and often the money from the civil airplanes is used to fund research for military.

So we should just see the total jet engine market.

The point was about jet engine going unsold, that too in defence sector. Why should I talk about commercial sector ?

Largest buyer is China and US and Europe wont and can't sell to them.

Russians build their own engine.

So effectively these engines only go to NATO countries and allies, and out of this Europe builds is own Engines too.

So who else remains ? Its not necessarily a sellers market. Its the US laws which prevent the companies from selling its secrets to us. Without it they would have happily sold it to even China or the highest bidder.

 

[UKBengali]

The point was about jet engine going unsold, that too in defence sector. Why should I talk about commercial sector ?

Largest buyer is China and US and Europe wont and can't sell to them.

Russians build their own engine.

So effectively these engines only go to NATO countries and allies, and out of this Europe builds is own Engines too.

So who else remains ? Its not necessarily a sellers market. Its the US laws which prevent the companies from selling its secrets to us. Without it they would have happily sold it to even China or the highest bidder.

No it is not just laws that prevents companies from selling their secrets but also
commercial interests.

No amount of money will make a jet engine manufacturer sell their tech to you.