Sunday, February 20, 2011

Offset Process for MSMEs

India’s aerospace and defence sector is throwing up huge entrepreneurial opportunities worth several hundred million dollars in the form of offsets.

An offset agreement is a stipulation made between a foreign supplier(Obligor) and a local company, which requires the supplier (Obligor) to fulfill certain offset commitments in that country as part of a Prime contract. For the Air India deal, Boeing’s offset commitment is to invest $1.7 billion and for P-8I maritime recce aircraft deal, it is $630 million, President Boeing said.

Boeing has already partnered with large-sized companies like TCS , Wipro , Infosys, HCL, Infotech, Tatas, etc. The Tier-I companies in the US/EU also need to partner with several hundred small companies in India for offsets. As of now, mid-tier companies in India such as Maini, Dynamatic and QuEST support the A & D supply chain of US/EU. Opportunities exit for similar other companies to supply to US/EU A & D Companies.

A & D Sector needs skilled labour, capital, technology transfer, equipment and military or civil certification in US/EU to be part of the chain.

“Entrepreneurs need to have a very good business plan supported by experts in the field. They also might need to partner with Tier-I companies. So, find partners, have a good plan, validated by experts in the field. In this business, there is no reward, if you can’t take risks”, the President said.

TTTHG-Svipja helps You develop business plan in concert with experts in the field from US/EU for You to be capable of becoming part of the supply chain of US/EU A & D Majors. Please read our Industrial Sector Partnership (ISP) Process on our Blog, www.IndianDefenceIndustry.blogspot.com

Read the Interview of President, Boeing India: International Co-operation and Offsets


Svipja Technologies

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