Reliance Defence signs warship repair pact with US Navy

Anil Ambani group led Reliance Defence and Engineering Limited (RDEL) has signed a Master Ship Repair Agreement (MSRA) with the US Navy to provide repair and alteration services for ships of the Seventh Fleet.

With this, RDEL became first Indian company (either public or private) to provide logistical support to the US military within Indian territory.

Key Facts
  • Under this agreement, RDEL will maintain the vessels of US Seventh Fleet involving 100 vessels operating in the Indian Ocean.
  • The signing of a MSRA agreement is a follow-up to the Logistics Exchange Memorandum of Agreement (LEMOA) signed between India and US in August 2016.
  • These vessels will be serviced and repaired from the RDEL owned private shipyard in Pipavav in Gujarat. This deal is likely to generate Rs. 10,000 crore in revenues for RDEL in the next five years.
  • The Pipavav shipyard was qualified and approved by US government to perform complex repair and alteration services for the US Navy after a detailed site survey conducted in October 2016.
  • The US Seventh Fleet looks after the Western Pacific and Indian Ocean. Currently, these vessels visit Singapore or Japan for such works.

Note: RDIL is the first private sector company in India to obtain the licence and contract to build Naval Offshore Patrol Vessels (OPVs) for Indian Navy. Its Pipavav shipyard is only modular shipbuilding facility in India having capacity to build fully fabricated and outfitted blocks. 

About LEMOA

It is a tweaked India-specific version of the logistics support agreement (LSA), which US has close military to military co-operation with several countries. LEMOA gives access, to both countries, to designated military facilities on either side for the purpose of refuelling and replenishment. It should be noted that it does not create any obligations on either Party to carry out any joint activity. It does not provide for the establishment of any bases or basing arrangements.

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Categories: Business & Economy Current Affairs 2017Defence Current Affairs 2017

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