Anil Ambani Current Affairs

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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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Reliance, Dassault Aviation ink deal to set up joint venture

Anil Ambani led Reliance Group and French aerospace giant Dassault Aviation have signed deal to set up a joint venture called Dassault Reliance Aerospace.

The Dassault Reliance Aerospace will execute offsets for the recently concluded India-France deal for 36 Rafale fighter jets.

It will be the largest offset contract to be executed by any defence company in India. The contract value is estimated up to Rs. 30,000 crore.

Key Facts

  • The proposed strategic partnership between Dassault and Reliance will also focus on promoting research and development (R&D) projects under the IDDM program.
  • IDDM stands for Indigenously Designed, Developed and Manufactured. It is programme on the lines with the new provision introduced in Defence Procurement Procedure (DPP) 2016.
  • The JV will focus on aero structures, engines and electronics and intends to infrastructure and supply chain in India for the aerospace sector.

Background

In September 2016, India and France had signed an Inter-Governmental Agreement (IGA) for 36 Rafale multi-role jets in fly-away condition worth €7.87 billion (about Rs. 59,000 crore). The deal has a 50% offset clause to be executed by Dassault Aviation and its partners in India. Through the offsets, government seeks to bring in much needed expertise to build the domestic defence and aerospace industry.

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