Engineering conglomerate Larsen & Toubro Ltd is to form a joint venture (JV) with France’s MBDA to develop and supply missiles and missile systems to the Indian armed forces, as L&T said on Monday.
MBDA is jointly held by Airbus Group, BAE Systems and Leonardo, and has expertise in developing all kinds of missile systems.
In the L&T MBDA Missile Systems Ltd (joint venture), L&T will hold 51%, whereas MBDA will control 49%. Though, both parties declined to share details of investments that will go into the joint venture.
The move to set up a joint venture comes in the wake of the Indian government deciding not to buy missile systems from overseas but source them domestically.
“To begin with, the JV company will look to develop and supply fifth-generation anti-tank guided missiles for coastal and high-speed target drones,” both companies said in a joint statement.
A.M. Naik, the group executive chairman at L&T, said that increased activities in India’s defence sector, spurred by the government’s efforts to procure a significant portion of defence equipment locally, prompted his company to sign the agreement with MBDA.
L&T and MBDA have worked together for the past six years in certain offset projects. The joint venture will operate from a dedicated work centre, which will include pyrotechnical integration and final checkout facilities, L&T and MBDA said in the statement. The venture is expected to be incorporated in the first half of 2017 after necessary approvals and it will come out with its first product in two years.