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Indian Defense Industry Market Attractiveness Forecasts to 2018
RnR Market Research Offers “Future of the Indian Defense Industry – MarketAttractiveness, Competitive Landscape and Forecasts to 2018” Report at US$ 1250(Single User License). The report got published in Mar 2013 & Contains 165 Pages.SynopsisThis report is the result of SDI’s extensive market and company research covering the Indian defenseindustry, and provides detailed analysis of both historic and forecast defense industry values includingkey growth stimulators, analysis of the leading companies in the industry, and key news.Introduction and LandscapeWhy was the report written?The Future of the Indian Defense Industry – Market Attractiveness, Competitive Landscape andForecasts to 2018 offers the reader an insight into the market opportunities and entry strategies adoptedby foreign original equipment manufacturers (OEMs) to gain a market share in the Indian defenseindustry.What is the current market landscape and what is changing?The Indian defense market offers numerous market opportunities to both domestic and foreignmanufacturers. As one of the largest defense equipment markets in the world, the country is expected tospend US$119.3 billion on capital acquisition alone during the forecast period. In the next two years, thecountry is forecast to spend a significant amount of money on homeland security, intelligence, and cybersecurity, primarily due to an increasingly hazardous geopolitical environment, the threat of terrorism, andinternal security concerns. Some more factors that are likely to influence the future growth course of thedefense sector in India are further development of the defense procurement process, the formation andimplementation of a defense industrialization strategy to coordinate the use of offsets, transfer oftechnology, FDI and revisions to the taxation regime, and incentives.What are the key drivers behind recent market changes?Indian defense expenditure is primarily driven by the need to replace the country’s aging militaryhardware and to protect India from its hostile neighbors. Strong economic growth has also fueled India’sdefense industry growth. Moreover, given that the Chinese market is closed to the world, India remainsthe primary place within Asia where major defense systems are sold.What makes this report unique and essential to read?The Future of the Indian Defense Industry – Market Attractiveness, Competitive Landscape andForecasts to 2018 provides detailed analysis of the current industry size and growth expectations from2014 to 2018, including highlights of key growth stimulators. It also benchmarks the industry against keyglobal markets and provides a detailed understanding of emerging opportunities in specific areas.Inquire for Discount @ http://www.rnrmarketresearch.com/contacts/discount?rname=83468Key Features and Benefits- The report provides detailed analysis of the current industry size and growth expectations from 2014 to2018, including highlights of key growth stimulators, and also benchmarks the industry against key globalmarkets and provides a detailed understanding of emerging opportunities in specific areas.- The report includes trend analysis of imports and exports, together with their implications and impact on
the Indian defense industry.- The report covers five forces analysis to identify various power centers in the industry and how theseare expected to develop in the future.- The report allows readers to identify possible ways to enter the market, together with detaileddescriptions of how existing companies have entered the market, including key contracts, alliances, andstrategic initiatives.- The report helps the reader to understand the competitive landscape of the defense industry in India. Itprovides an overview of key defense companies, both domestic and foreign, together with insights suchas key alliances, strategic initiatives, and a brief financial analysis.Key Market Issues- Introduced under the DPP 2005 and developed further in 2012, the offset policy encourages theindigenous Indian defense industry to play a major role in meeting the needs of the armed forces byrestricting FDI to 26%. It is expected that small- and medium-sized enterprises will benefit from theoffsets, leading to a larger presence of private companies in the defense industry. Additionally, therevised DOG’s 50% indigenous requirement and timeframe to achieve that will have a negative impact onthe domestic defense industry. It is a known fact that very few Indian companies can offer products with50% or more indigenous content. The stipulated time frame to achieve the same is not encouraging eitheras Indian companies are now required to prove the indigenous content at the time of submission oftechnical bids, which implies they need to have 50% indigenous content even before the actualproduction begins. Far from being realistic, this move also discourages any Indian company that wants tocompete at the global level.- Insufficient information and the lack of clear future plans have been key challenges for both the privatesector and foreign companies, in planning the development of research and development technology orthe formation of joint ventures. Although the MoD has agreed to provide a public version of the long-termplan, its effectiveness remains to be seen. One of the key objectives of DPP 2009 is to enabletransparency and integrity in all defense industry acquisitions. To ensure this, the Defense AcquisitionCouncil (DAC), India’s supreme defense procurement agency, has recently approved a fifteen year LongTerm Integrated Perspective Plan (LTIPP) 2012-2027. The plan defines the acquisition road map for thethree forces for the next 15 years. Only the Indian Navy had a perspective plan while the IAF and thearmy had never had such a practice. Based on the new LTIPP, a technology perspective capability roadmap would be made and shared with DRDO, defense public sector undertakings and the industry toenable advanced planning.- Since the early 1970s, the Indian defense procurement process has included corruption, delays, andbureaucratic hurdles, due to the monopoly of the civilian bureaucracy and politicians over the purchasedecisions of the armed forces. Although the armed forces are in charge of conducting trials on shortlistedequipment and forwarding their recommendations to the Ministry of Defense (MoD), any financialnegotiations are conducted by civilian officials. This gives rise to the opportunity for corruption, by way ofbribes and collecting money for election funds. Although India is one of the only countries to ban middle-men and brokers from operating, they are unofficially involved in almost every deal negotiated withinternational companies for the importation of defense equipment. Moreover, in many cases, equipmenttrials and negotiations drag on for decades. For instance, the IAF’s acquisition of advanced jet trainers(AJTs) has been delayed by nearly a quarter of a century. Although the requirement for Hawk trainerswas raised by the air force in the early 1980s, the deal could only be signed with BAE in March 2004, withthe delivery of the first aircraft in 2009. In early 2013, the Italian firm AgustaWestland emerged at thecenter of a controversy over allegations of paying kickbacks in the INR 3600 crore (US$ 663 million) VVIPchopper deal. Italian authorities have already made arrests during an investigation into bribes allegedlypaid in 2010 by AW’s parent company Finmeccanica for the deal involving the supply of a dozenhelicopters for the intended use of Indian VVIPS including the Prime Minister and the President.- In order to cater to the Indian defense industry, it is essential that companies develop advanced low-costtechnology solutions. This is especially true in the middle tier, where the degree of sophistication is not as
high as it could be. Due to low labor and infrastructure costs, the defense products developed in India aregenerally very competitively priced compared to imports. An example of this is HAL’s advanced lighthelicopter, the Dhruv, which only costs US$5 million, one-third of the price of similar helicopters availablefrom mature markets. In 2009, HAL secured a notable order for seven Dhruv helicopters from Ecuador,despite intense competition from international vendors such as Bell and Sikorsky. However, Ecuador hasexpressed dissatisfaction that these choppers are becoming a cause for concern due to poor after salesservice, expensive spares, and even over-invoicing.Key Highlights- India’s defense imports increased considerably during 2007-2011, making it the largest global defenseimporter in 2011. The country’s imports constituted 8.5% of the total global arms transfer in 2011. Thegovernment’s modernization plans, combined with the external threats faced by India, have led to thecountry requiring a large amount of imports to fulfill its defense requirements. Since India’s domesticdefense industry is limited, large amounts of its defense requirements are expected to continue beingimported over the forecast period.- The Indian defense expenditure is primarily driven by the need to replace the country’s aging militaryhardware and to protect India from its hostile neighbors. Strong economic growth has also fueled India’sdefense industry growth. Moreover, given that the Chinese market is closed to the world, India remainsthe primary place within Asia where major defense systems are sold.- India’s defense industry is still in its early development stage, and defense exports are limited to a fewneighboring countries and less developed nations such as Mauritius, Bangladesh, Nepal, and Indonesia.During the review period, ships, aircraft, and sensors were the three-most exported defense goods. Mostof the current defense exports in India are offered by public sector companies. Principal exporters includeBharat Electronics, Bharat Earth Movers, Ordnance Factories Board, and Hindustan Aeronautics Limited(HAL). The country’s main exports include military hardware such as rifles, rockets, radars, anddomestically developed helicopters and planes such as the light transport aircraft, Dornier 228, theadvanced light helicopter, Dhruv, and the light attack helicopter, Lancer.- The DAAM has been issued by the Ministry of Home Affairs (MHA) in order to regulate the production ofarms and ammunition in the private sector. The following highlights the key points under DAAM:·Theprivate sector is permitted to manufacture arms on a limited basis only and on the issue of an industriallicense by the Department of Industrial Policy and Promotion (DIPP) DIPP licenses are only issued toprivate companies agreeing to invest US$11 million (INR500 million), subject to maximum 26% FDI, andequipped with advanced manufacturing capabilities.The draft policy also prohibits the participation ofsmall business units in arms and ammunition manufacturing. The supply of arms and ammunition isrestricted to the Central Paramilitary Forces, and Defense and State Governments on a tendering orexport basis. Sports weapons and non-prohibited bore (NHB) weapons can, however, be sold to licenseholders through registered arms dealers. The manufacturing quota of existing firms will not beenhancedDIPP has the authority to make changes in the draft policy as and when requiredBuy a Report Copy @ http://www.rnrmarketresearch.com/contacts/purchase?rname=83468Table of Content1 Introduction1.1. What is this Report About?1.2. Definitions1.3. Summary Methodology1.4. SDI Terrorism Index1.5. About Strategic Defence Intelligence2 Executive Summary3 Market Attractiveness and Emerging Opportunities
3.1. Defense Market Size Historical and Forecast3.1.1. Indias total defense expenditure to grow at a CAGR of XX% over the forecast period3.1.2. Hostile neighbors and modernization initiatives will be the industrys primary growth drivers3.1.3. Defense budget as a percentage of GDP will remain at an average of XX% over the forecast period3.2. Analysis of Defense Budget Allocation3.2.1. Capital expenditure allocation expected to remain at an average of XX% during the forecast period3.2.2. Army gets the largest share of the defense budget3.2.3. Defense ministry will spend US$XX billion on its army over the forecast period3.2.4. Defense ministry will spend US$XX billion on its air force over the forecast period3.2.5. Expenditure for the navy is expected to grow at a CAGR of XX% over the forecast period3.3. Homeland Security Market Size and Forecast3.3.1. Indias Homeland security market estimated at US$XX billion for 20133.3.2. Cross-border terrorism and domestic insurgency to be the main factors driving homeland security3.3.3. India falls under "worst affected" of terrorism category3.3.4. India has terrorism index score of 5.13.4. Benchmarking with Key Global Markets4 Defense Procurement Market Dynamics4.1. Import Market Dynamics4.1.1. India was the largest arms importer during 2007-20114.1.2. Russia dominates Indian arms imports4.1.3. Aircraft accounted for the majority of defense imports during 2007-20114.2. Export Market Dynamics4.2.1. Indias low profile in defense exports is set to change over the forecast period4.2.2. Underdeveloped nations across Asia, Africa and Latin America are the main importers of Indiandefense goods5 Industry Dynamics5.1. Five Forces Analysis5.1.1. Bargaining power of supplier: low to high5.1.2. Bargaining power of buyer: high5.1.3. Barrier to entry: medium to high5.1.4. Intensity of rivalry: high5.1.5. Threat of substitution: medium to high6 Market Entry Strategy6.1. Market Regulation6.1.1. Defense Procurement Procedure (DPP) - 2011: A significant improvement6.1.2. Offset policy to drive defense industrial modernization6.1.3. Main features of revised Defense Offset Guidelines (DOG) - 20126.1.4. Private sectors permitted to produce arms and ammunition under the new Draft Arms andAmmunitions Manufacturing Policy (DAAM)6.1.5. Payment to foreign technology partners does not require governmental approval6.1.6. Foreign direct investment limited to XX% in the Indian defense sector6.2. Market Entry Route6.2.1. Foreign OEMs are forming joint ventures in order to enter the market6.2.2. India emerges as a key outsourcing hub for global defense companies7 Competitive landscape and Strategic Insights7.1. Competitive landscape Overview7.1.1. Domestic public companies have a strong presence in the Indian defense industry7.2. Key Foreign Companies7.2.1. Lockheed Martin Corporation - overview7.2.2. Lockheed Martin Corporation - main products7.2.3. Lockheed Martin Corporation - recent announcements and strategic initiatives7.2.4. Lockheed Martin Corporation - alliances
7.2.5. Lockheed Martin Corporation - recent contract wins7.2.6. BAE Systems Plc. - overview7.2.7. BAE Systems Plc. - main products and services7.2.8. BAE Systems Plc. - recent announcements and strategic initiatives7.2.9. BAE Systems Plc. - alliances7.2.10. BAE Systems Plc. - recent contract wins7.2.11. Thales - overview7.2.12. Thales - main products and services7.2.13. Thales - recent announcements and strategic initiatives7.2.14. Thales - alliances7.2.15. Thales - recent contract wins8 Business Environment and Country Risk8.1. Demographics and Social Statistics8.1.1. Population - Total rural population8.1.2. Population - Total urban population8.1.3. Population - Number of Households8.2. Economic Performance8.2.1. GDP Per Capita, USD8.2.2. GDP (current USD Billion)8.2.3. Exports of goods and services (current USD Billion)8.2.4. Imports of goods and services (current USD Billion)8.2.5. Gross National Disposable Income (USD Billion)8.2.6. Manufacturing Output (USD Billion)8.2.7. Consumer Price Index8.2.8. Wholesale Price Index8.2.9. LCU per USD (period average)8.2.10. LCU per EUR (period average)8.2.11. Lending Rate (%)8.2.12. Real Interest Rate (%)8.2.13. Market Capitalization of Listed Companies (USD Billion)8.2.14. Market Capitalization of Listed Companies (% of GDP)8.2.15. Total Government Cash Surplus/Deficit (LCU Billion)8.2.16. Total Government cash surplus/deficit as % of GDP (LCU)8.2.17. Central Government Debt (LCU Billion)8.2.18. Central Government Debt as a percentage of GDP (LCU)8.2.19. Goods exports as a percentage of GDP8.2.20. Goods imports as a percentage of GDP8.2.21. Goods balance as a percentage of GDP8.2.22. Services imports as a percentage of GDP8.2.23. Services Exports as a percentage of GDP9 Appendix9.1. About SDI9.2. DisclaimerFor more details contact Mr. Priyank Tiwari: email@example.com / +18883915441Website: http://www.rnrmarketresearch.com/