Defence FDI limit is not enough for Make in India, says Airbus

Aircraft manufacturer Airbus on Monday said that the company is aiming investments worth Rs 5,000 crore in India if the defence projects the company is pitching for come through.

Pierre de Bausset, president and managing director of Airbus Group India (AGI) however added that the 49 per cent Foreign Direct Investment (FDI) in India is insufficient to get “quality” original equipment manufacturers (OEM) that it requires for the Make in India initiative. “ “Forget about 49 per cent. It is not going to get an industry and it is not going to get OEMs of quality. You may get a few but not the right ones. And when they need us a lot in the beginning, I want fair business.

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Fair business means that we need to have levels of controls that are appropriate for the risks that we are taking. So setting the limit at 49 per cent or whatever amount is not… you have to think in terms of how do you attract us, how do you attract talent, how do you make it a good win-win partnership and not a very strait-jacket in the beginning,” Bausset said in a presentation to reporters here.

The government had, in August 2014 raised the FDI cap from 26 per cent to 49 per cent.