Ajai Shukla
Business Standard
New Delhi, 30 October
Prime Minister Narendra Modi on Sunday said he could foresee that India would soon be manufacturing big passenger aircraft that would proudly bear the words ‘Made in India’. He was speaking at the foundation stone ceremony of the Tata-Airbus C295 aircraft manufacturing facility in Vadodara, Gujarat. The Rs 22,000-crore project is being seen as a win for Gujarat ahead of assembly elections in the state.
Addressing the gathering, the PM said, “India is moving forward with the mantra of ‘Make in India, Make for the World’….. The C-295 aircraft would bolster the logistical capability of the Indian Air Force (IAF).’’ While pointing out that India is making fighter jets, tanks, submarines, medicines, vaccines, electronic gadgets, mobile phones and cars that are popular in many countries, the PM said India would now become a huge manufacturer of transport aircraft.
Putting stress on the increased demand for passenger and cargo aircraft, the PM said India would need more than 2,000 aircraft in the next 15 years. ‘’Today is a crucial step in this direction.’’
Speaking at the event, Tata Sons chairman N Chandrasekaran said, ‘’This is a historic moment not only for the Tata Group but for the country, as it embraces the Hon’ble Prime Minister’s vision of being truly ‘Atmanirbhar’”.
Airbus chief executive officer Guillaume Faury said, ‘’Our teams are committed to supporting the modernisation of the Indian Air Force with the C295 programme, which will also contribute to the development of the private defence manufacturing sector in the country.’’
Congratulating the two groups, the PM said more than 100 medium, small and micro enterprises (MSMEs) were associated with the project.
Highlighting that India is creating an unprecedented environment for manufacturing in the country, Modi cited the creation of a simplified, globally competitive, corporate tax structure, permitting 100 per cent foreign direct investment (FDI) across sectors, opening up defence and space sectors for private companies, reforming 29 central labour laws into four codes, abolishing 33,000 compliances, and creating the Goods and Service Tax that put an end to a complex web of dozens of taxes.
He recalled a time when the dominant thought was to focus on the service sector as manufacturing was considered to be beyond reach. “Today, we are improving both services and manufacturing sectors… India is preparing to stay ahead of everyone in manufacturing,” he said. While reiterating the investment-friendly policies, the PM urged India Inc to move aggressively on manufacturing without losing the current opportunity. “Growth momentum of India has been maintained despite COVID-19 pandemic, war and supply-chain disruptions.”
Modi said that over $3 billion has been invested in the aerospace sector alone. Post 2014, investment in this sector grew five times larger then what had been invested during 2000 to 2014. “We aim to scale our defence manufacturing beyond $25 billion by 2025. Our defence exports will also exceed $5 billion,” he added.
“Today our policies are stable, predictable and futuristic,” he said. “A new saga of economic reforms is being written in India and the manufacturing sector is reaping the most benefits from this, apart from the states.”
The PM lamented the “makeshift approach” of the previous government where the manufacturing sector was kept barely functional through subsidy.
Under the C295 project, a consortium of two Tata Group companies – Tata Advanced Systems Ltd (TASL) and Tata Consultancy Services, led by TASL – will assemble 40 Airbus transport aircraft with manufacturing technology supplied by Airbus Defence and Space. This is the first time a private firm has been entrusted with manufacturing an entire military aircraft.
The project will also involve Airbus supplying the first 16 transport aircraft ready-built in Seville, Spain. The aircraft can be used for both military and civilian purposes.
The first 16 “fly-away-condition” aircraft are scheduled to be received by the IAF between September 2023 and August 2025. The first C-295s assembled in Vadodra are expected to be delivered from September 2026.
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