India, a Global Aerospace Power ?
For the past 60 years, India has built a steady reputation as a nation with strong aerospace and defence capabilities, but it is a reputation which has been forged, for the most part, in splendid isolation. While a number of critical requirements have been fulfilled by indigenous aerospace and defence products, those same products have not been readily transferred to the world market.
That looks set to change, however, because all the signs are that India is poised to enter the global aerospace and defence economy, not with a whimper, but a bang. India’s place on the global aerospace and defence industrial stage will not be secured overnight, it will have to be earned. But this revolution is already underway thanks to a confluence of circumstances that play heavily in India’s favour.
Take its workforce, for example. At a time when western aerospace leaders are facing up to a dearth of engineering talent at home as the ‘Baby Boomer’ generation retires, India’s young population means that skill-sets laid down today will pay dividends over the next 50 years, not just in India, but globally. The fact, too, that the language of the global aerospace industry happens to be English is an enduring advantage that will also help Indian engineers plug quickly into the global aerospace economy.
India already has a solid manufacturing base, thanks to the prevalence of its automotive industry. While automotive is not ‘aerospace grade’ in terms of cost, quality and schedule, it is an excellent place to start. Tata, for example, recognised worldwide for its automotive prowess, is already emerging as a highly credible aerospace and defence industrial partner.
India is also a world leader in key areas such as IT, engineering, and research and development, disciplines that are core elements of a successful aerospace and defence ecosystem. Private sector companies such as Wipro, Infotech, Infosys, HCL and public sector undertakings such as HAL and BEL are poised to take the Indian aerospace industry to new heights.
As defence systems in particular become increasingly ‘network-enabled’, the buzz term that denotes the way satellites, aircraft, ships and vehicles share data to promote greater battle-space knowledge and awareness, India is well positioned to play an important role in defining and building the system-of-systems architectures that are fundamental to modern defence networks.
Aerospace is an industry based on innovation, creativity, and advanced technical skills with a history of startling accomplishment, thus India’s focus on education and natural entrepreneurship fits nicely into it. In addition, the injection of the kind of entrepreneurial flair for which India is noted could even breathe new life into the aerospace and defence business globally.
It is, of course, the phenomenal surge in demand within India for civil aircraft and defence products and services that is providing the catalyst for rapid change in India’s aerospace and defence industrial infrastructure.
Whatever uncertainties may exist currently in global financial markets, India’s strong and growing domestic demand for civil aviation, more than a thousand aircraft worth in excess of $100 billion are needed over the next 20 years, continues largely unabated. The Indian government is also expected to spend a roughly equivalent sum on defence products over a similar period.
Aerospace and defence as a sector is notorious for its high barriers to entry and India will need to invest heavily in knowledge and innovation to ensure that its developing skills are not swamped by the established global competition.
The key to improving R&D in India is through strategic collaboration among government, industry and academia, building on the success of the public private partnerships that have been instrumental, for example, in the development of new airports and other critical infrastructure across India.
On paper, the fact that some 500,000 engineers graduate every year in India is impressive and is often quoted in the US and Europe as a reason why the west needs to invest more in its own school-age maths and science talent to produce more engineers of its own.
But the headline figures do not tell the whole story. India has only 200 ‘dynamic engineers per million’ as opposed to 750 in the US and 500 in China. Given that over 45% of India’s population is under 19 years of age, there is still everything to play for when it comes to the penetration of quality education in this demographic.
Training is another big ‘if’. The current mismatch in India’s ability to supply trained manpower to meet demand is highlighting a dire need to establish aerospace vocational training institutes in India. These would help fulfil the demand for the diverse skills that aerospace demands; skills that range from engines and airframes to networked systems and avionics.
Going further, and building on India’s automotive revolution, Indian companies are well positioned to leverage their established footing in global quality management systems, ISO, QS, TS and the like, to advance to aerospace standards that would cement these companies’ standing in the global aerospace arena.
From this would flow, too, a corresponding improvement in the country’s maintenance infrastructure, an easily assessable indicator of sectoral competence. One way of establishing competences in this and other key areas is to set up dedicated hubs or special economic zones where high-precision manufacturing, processing and assembly can be undertaken.
Government can play its role by setting in place policies and incentives to help India achieve the rapid growth of which it is capable. These include tax exemptions, concessions on excise duties and liberal foreign exchange regulations as well as other policies that incentivise global aerospace companies to join with their Indian counterparts.
These relationships are central not just to a thriving market for aerospace and defence goods in India, but to an eventual two-way sharing of technological capabilities, precision manufacturing and R&D. Given the enormous amount of aerospace work due into India in the next five to ten years, and the offset programmes related to it, this should help trigger the necessary investments.
But the public and private sectors need to invest in advance of this surge in order to get the right foundations laid, their people trained and the relevant risks reduced. If the above issues are addressed, India will have seized a unique op-portunity and graduated to a well-earned place as an important player in the global aerospace and defence industry.
Credit: The Economic Times.
Writer: Ian Q R Thomas
, President, Boeing India.