“Diversification Efforts” In conversation with BEL Chairman and MD SK Sharma
BEL is working on many strategic areas such as AESA-based modern radars, new generation Electronic Warfare (EW) suites, air defence systems, tactical communication systems, battlefield management systems, passive night vision devices and multi-sensor stabilisation systems, in order to anticipate and pre-empt many impending modernisation requirements from the Indian Armed Forces.”
As the CMD confirmed, BEL has already entered into strategic alliances with defence laboratories, the Ordnance Factory Board (OFB), other DPSUs and several global and Indian companies, in order to address the emerging requirements of the Indian defence forces. Various products and systems under consideration include Surfaceto-Air Missile (SAM) systems, air defence radars, sonar systems, next generation night vision devices, gun upgrades and new gun programmes, Inertial Navigation Systems (INS), Medium-Altitude Long-Endurance (MALE) Unmanned Aerial Vehicles (UAVs), electronic ammunition fuses, electronics systems for the Army’s Future Infantry Combat Vehicle ( FICV) programme, SATCOM terminals and missile containers. BEL achieved its highest ever export sales of USD 57.85 million in 2014-15, registering a growth of 37.7% over the previous year’s export turnover of USD 42 million. The export sale for the year 2015-16 is expected to surpass the targeted USD 65 million and cross USD 80 million. The long-term export plan of BEL is to sustain revenue from export sales at 10% of total turnover, compared to the current level of 5.3%.
BEL is focusing on opportunities in the areas of offset obligations of foreign OEMs responding to various MoD RFPs. The focus is on ‘Build to Print,’ ‘Build to Spec,’ and ‘Buyer Nominated Equipment.’ BEL has signed MoUs with many foreign companies and is working with major aerospace and defence firms to establish long-term supply chain relationships. BEL is also pursuing possibilities for export of products and systems to ‘ friendly’ countries with MoD approval. Currently, BEL’s coastal surveillance system, naval air surveillance radars, sonars, night vision devices and electronic voting machines are being promoted to South East Asian, Middle Eastern and African countries.
Major export programmes already being executed include Naval Surveillance Radars to Myanmar, TI fire control systems to Israel, electro-mechanical parts to GE and Siemens, and more.
The present business environment in defence equipment manufacturing is changing as the MoD encourages greater participation of private companies. The increase in the FDI limit to 49% will also help foreign players to set up joint ventures with Indian industry. As a diversification strategy, BEL has been exploring opportunities in related defence and non- defence areas for enhanced business growth, leveraging the strengths and capabilities acquired over decades in the defence electronics domain.
In the past decade, BEL has entered into several new business areas as part of diversification efforts, resulting in substantial revenue increases. Efforts are underway to enter and consolidate in business areas such as indigenous SAM systems, airborne radars, image intensifier tubes and thermal imaging detectors for night vision devices, inertial navigation systems, electronic ammunition fuses, pressurised missile containers, critical infrastructure protection, air traffic management radars, intelligent traffic management systems, solar power plants and smart city elements for future business growth.