In a path-breaking decision, the Ministry of Defence (MoD) has approved a proposal by the Defence Research and Development Organisation (DRDO) for transfer of technology (ToT) for commercial production of its Lakshya pilotless target aircraft (PTA) to private sector defence manufacturer Larsen and Toubro (L&T).
The L&T will pay a royalty to DRDO for every Lakshya PTA produced and sold by it. Prospective customers for Lakshya include foreign militaries, including those of Singapore, Malaysia and Israel.
L&T will have to take permission from the MoD while selling Lakshya abroad. This condition is part of the approval granted by the Defence Procurement Board.
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The Lakshya PTA is a reusable subsonic aerial target system developed by the Bangalore-based Aeronautical Development Establishment of DRDO, and was first inducted into the Indian Air Force in 2000. The Navy and Army acquired the Lakshya PTA in 2001 and 2003.
Powered by a gas turbine engine and launched either from land or ship, it carries two towed targets to realistically simulate enemy aircraft threat. These towed targets are used for training of gun and missile crews, and for combat aircraft pilots.
Lakshya ToT with L&T is the first instance of a critical defence technology being transferred to a private manufacturer in India on royalty basis. Before this, critical defence technologies were given to defence PSUs by nomination with little incentive
to commercially produce and market them. Defence PSUs were transferred these technologies by DRDO free of cost whereas private defence manufacturers will now pay a royalty for the ToT.
The DRDO has earlier transferred certain life sciences technology to private manufacturers for commercial production on royalty basis. The most famous among them being the ready-to-eat food products commercially produced and sold by MTR Foods. That technology was developed by DRDO’s Defence Food Research Laboratory (DFRL) laboratory at Mysore.
L&T officials were not available for comment but sources in the industry said that L&T had been associated with the Lakshya project and had produced the launcher for the Army version of Lakshya. Tatas had produced the launcher for the IAF version of Lakshya PTA.
According to sources in the DRDO, this new model of engagement will interest other private defence manufacturers to bid for defence technologies developed by DRDO. It will also help DRDO pull back its resources from constant improvements to an existing platform.
“This will allow the industry to do what DRDO currently does what it should not really do, i.e., upgradation of a system. We will do the hand-holding. But a private manufacturer with access to base technology can easily develop a newer version, a Mark II for a platform,” a DRDO official said.
Industry sources said that L&T and DRDO will work jointly to build a production model for Lakshya-2, by using the basic Lakshya-2 design and making it production friendly. Lakshya-2 is an advanced version of Lakshya, with more flight endurance, lower altitude flying and higher cruising speed.
Sources in the MoD told The Sunday Express that this deal with L&T has happened even before they could announce new comprehensive guidelines for ToT to private defence manufacturers.
The new ToT guidelines framework has been approved by the Defence Minister and is likely to be announced next month. A case by case sanction for ToT from the MoD will not be required once comprehensive guidelines are issued.
The new ToT framework will provide all manufacturers, whether private or Defence PSU, an equal opportunity to access defence technology on royalty basis. This will redress one of the major complaints of the local private defence manufacturing industry that it did not have a level playing field with Defence PSUs.
Exclusivity rights in ToT will, however, continue to reside with the government. This means that the rights will come back to the government in case the private defence manufacturer, who has bought the ToT, shuts shop for any reason.