India's BHEL seeks more defense work

Discussion in 'Internal Security' started by LETHALFORCE, Apr 6, 2012.


    LETHALFORCE Moderator Moderator

    Feb 16, 2009
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    India's BHEL seeks more defense work

    India's state-owned Bharat Heavy Electricals Ltd. seeks more defense contracts.

    "We see big business emerging in the defense sector after the announcement of the offset policy," BHEL chairman and Managing Director B. P. Rao said.

    "We believe that the offset policy that includes transfer of technology is an excellent move that will provide huge opportunities for us."

    The state-run BHEL, which is 67.72 percent owned by the Indian government, has reported a 21 percent rise in profits for the 2012 fiscal year, The Hindustan Times reported.

    "We are already producing the super rapid gun mount' for the Indian navy. Now the ministry wants us to manufacture an improved version of the gun," said BHEL Industrial Systems and Products Director M.K. Dubey.

    Indian Minister for Heavy Industries and Public Enterprises Praful Patel said that he is to take up the issue of increased defense business for BHEL with the Ministry of Defense.

    Founded in 1953 and with headquarters in New Delhi, BEHEL employs more than 46,000 workers. It is one of the oldest and largest state-owned engineering and manufacturing enterprise in India's energy and infrastructure sector.

    The company is involved in India's power, railways, power transmission and distribution and oil and natural gas sectors, among others and is the 12th largest power equipment manufacturer in the world.

    BHEL has been earning profits continuously since 1971and paying dividends since 1976, while 74 percent of the total power generated in India is produced by equipment manufactured by BHEL.

    India's indigenous defense sector is projected to grow.

    In analyzing the Indian government's 2012-13 budget, Dolat Capital wrote, "We expect a 10 percent hike in capital outlay for the country's defense sector from, $13.65 billion to $15 billion."

    Driving the company's diversification efforts is the fact that Chinese companies are aggressively seeking to enter India's energy sector.

    "If Chinese competitors continue to have access to cheaper financing, it could result in an increase in orders placed with Chinese manufacturers and a loss of new orders for domestic equipment manufacturers, including us," a BHEL draft document for the government stated.

    "We also face competition from a significant number of foreign companies, such as Shanghai Electric Group Company Limited, Doosan Heavy Industries, SEPCO Electric Power, Harbin Power Plant Equipment Group Corp. and Dongfang Electric Corp., which compete primarily on price and delivery time."

    BHEL added that the scenario is providing Chinese entities with an advantage over non-Chinese competitors in securing orders from Indian power generation companies, "which traditionally constitute our primary customer base in this sector."
  3. Ray

    Ray The Chairman Defence Professionals Moderator

    Apr 17, 2009
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    Sure more work can be given if it proves competitive and not make the Army a captive to keep it functional with orders that are not worth it as the Audit report of BEML reads where TATRAs were required to keep the assembly line active!
  4. SPIEZ

    SPIEZ Senior Member Senior Member

    Sep 24, 2011
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    BHEL is one of the last properly functional and quality organisations in the Indian Public sector. Let's see if the MoD any do any good to such PSU's.
  5. Bachchu Yadav

    Bachchu Yadav Regular Member

    Apr 5, 2012
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    Obviously BHEL would like to join Feast. There is lot of corruption in Defence Sector and acquisitions.

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