The rise of the Indian aviation sector

"And to ye all" he said...,"for the nonexistent avid readers of this blog will remember, that it had been predicted that Air-Deccan stock might carefully rise, and lo and behold, risen it has. For this is the proof you need of my existence. " thus went the stock broker's ghost.

"But carefull", said he who had been present through the crash, "all it takes is one crash, metaphorical or otherwise".

The aerospace sector is in a boom, but profits are low, and growth is high, so costs are huge, would I hold on to my stock????? Well lets say this, Rs 110 could be a good bail out price in the current (hopefully long lived!*) bear run. (And rs 100 or below is definatley a jump in price)

Thus endeth the stupidity...



*Long live the corrective bear run, at inflation touching 6.5% all stocks could be ovepriced, plus one needs a break in point!

And off we go

The first deal in the making

India to buy 40 SU30 MRF s from Russia, at around $40 Million each that comes to a whopping $1.6 Billion dollar deal! Hope we get some discount!

And whats more, this is not a part of the "Mother of All deals!"

SU30: High capblity, heavy weight, MRF. MRFs are capable of multi roled missions, such as air supremacy, target destruction, patrolling, reconnaisance, and plain old carpet bombing.


Is this a primer to the acquisition of 126 MRFs from a US based company???????? First make ze Russians happy and then shake hands with Uncle sam? Who is taking the bets, I bet its F16s and F18s. THe real question is, do I hope I am wrong!

"The mother of all defence deals!"

I am referring of course to the planned acquisition of about 126 Multi Role Fighters by the good old IAF. The Aero-India show is in full swing, airplanes are floating around and so is the money. Its going to be a HUGE deal, think at least $17-20 Million for a lighter version and above $40Million for a heavy version of MRFs.

Add to that the planned acquisition of AWACS, Missile defence systems, UAV systems, and other assorted goodies, its going to be an early Christmas for defence contractors in Bang-a-lore!

The real question is of course, what should India buy. Should it be the awesomely maneuverable yet not so modernly equipped Mig 29s, or the impeccably cool and unnecessarily heavy Sukhoi 37s? Or maybe the battle proven and superbly equipped, but comparatively sluggish to handle F16s and F18s? Eurofighters, though shouting its head off to glory, is not yet battle proven. So unless we have an awesome deal on that, I dont think its going to happen. As for the other smaller players, there is the issue of Technology transfer and lifecycle cost.

We have been flying the Russian makes for a while now. They are good, reliable, super fast, agile, and extremely maneuverable aircraft. But at the same time, their avionics capabilities are a wee bit limited. That's not to say that putting excessive amount of computer screens displaying a helluva lot of info is the sure shot way of winning a dog fight, or even striking a bogey. But still, avionics go a long way in first strike missions. Awesome avionics capabilities should be on the radar of IAF anyway, if they want to survive in a net-centric battlefield.

The American makes are new to us, though rather sluggish compared to the Russian makes, they do come equipped with all sorts of gadgets that you could imagine. The most important part though, is that the avionics research in the US is a "very" current and active field. Being an IT based country, we sure want a piece of that pie. Under these circumstances scratching the self proclaimed Big Brother's back is not such a bad idea.

And Big Brother does need a back scratching, though bustling with economic prosperity in the defence sector, a deal of 126 Fighters could totally put the US defence industry in a vertical ascent mode. Not to say it will bring the fighter building arms of Lockheed Martin, Northrop Grumman, and a host of other suppliers out of the red.

But the key to the whole deal is going to lie in the following set of words: "Technology Transfer". Who is willing to give us the licence to manufacture the fighters in India, and a guarantee that all spare parts will be available even in the event of war. Well, Big Brother is reluctant to jump on that bandwagon. US is secretive about its defence program, it does not like to give out plans, and definitely likes to keep the final card under its control. If they do give us the green of tech transf. it will be HISTORY! A new chapter for Indian Aerospace industry. Well face it, Russia is not doing that well, and US is pouring bucket loads of money through proper channels in India. Plus we already have the licences for the Russian makes. The only question that remains is: do we want to go ahead and grab the Americans at the cost of upsetting Russia?

One final though, maybe we could just stick with the Russian makes, pressure them into selling us complete tech rights, and develop our own avionics and mission systems suite??


But then again, the threat to the nation is not current,

Welcome, to a decade of Aerospace...

NOTE: This blog was meant to be posted last year in March, however somehow it did not get posted! It was saved instead as a draft, I guess its time has come!

"The coming decade, will see the Indian aviation and aerospace sector grow as a global power.."
- Praful Patel, Minister of civil aviation, India.

And why not? Last year 8 new airlines took to sky, and are flying succesfully, with more than 70% occupany rate. Last year, the prices of an aircraft ticket started seriously competing with those of Railways, Last year, the Indian Airshow was the biggest and best ever in the history of southeast Asia rivaling with the world, last year Indian aviation companies ordered a total of more than 150 airliners overseas, it is said that they pretty much breathed a new life into aerospace. Indian orders combined with chinese orders, pulled some of the Boeing plants from the verge of mass layoffs and under capacity production!

The ground is laid, we are witnessing a new market taking off in India, and there are going to be HUGE opportunities, and huge risks!