German defence manufacturer, Rheinmetall is exploring options to enter the Indian defence market in collaboration with state-run engineering major BHEL. The German firm has shown keen interest in investing in the Uttar Pradesh (UP) Defence Corridor for its Lynx armored vehicles and is in talks with BHEL as well as the UP government in this regard.

The Lynx Armoured Fighting Vehicle is an advanced armored fighting vehicle that might compete for the Indian Army’s FICV (Future Infantry Combat Vehicle) project as well, which is expected to replace the BMP vehicles for the mechanised and armored forces. The Lynx’s IFV configuration allows it to mount a LANCE turret with a 30- or 35-mm cannon, and a secondary armament of a coaxial 7.62mm general-purpose machine gun along with provisions of carrying ATGMs and smoke grenade launchers.The vehicle is highly modular and can be modified for usage as a mobile command and control center, armored surveillance, field ambulance, APC, or as a recovery vehicle.

Rheinmetall Group is Europe’s foremost supplier of defence and security ware, and is a partner of the armed forces of Germany and its NATO allies.The company, with a turnover of 6.2 billion euros last year, specialises in automotive parts, military vehicles, autocannons, anti-aircraft defence systems, artillery, tank guns, munitions, etc.

The CEO of Rheinmetall Electronics Division, Susanne Wiegand, and the CEO of Rheinmetall Air Defence, Fabian Ochsner reportedly held a video conference with UP’s investment and promotion of MSME (Micro, Small and Medium Enterprise) minister Siddharth Nath Singh over the proposed investment in the state.

The CEO of Rheinmetall Electronics Division, Susanne Wiegand, and the CEO of Rheinmetall Air Defence, Fabian Ochsner reportedly held a video conference with UP’s investment and promotion of MSME (Micro, Small and Medium Enterprise) minister Siddharth Nath Singh over the proposed investment in the state.

The first project that is being targeted is Skyshield air defence gun, which is considered among the best air defence gun in the world, followed by tank guns and artillery guns.

Officials from Rheinmetall have reportedly requested an interaction with Government of UP to understand the various policies in UP, including ‘Invest UP’ and the Defence Policy and the incentives and other assistance that the government can provide. The company has indicated to return soon with some proposal after discussion with BHEL on exactly where it can put up a plant and the quantum of the investment.

On August 14, Uttar Pradesh CM Yogi Adityanath’s government formed an entity, ‘Invest UP’, to promote investments in the state. Its Chairman is Chief Minister Yogi Adityanath with Industries Development Minister Satish Mahana and MSME Minister Siddharth Nath Singh as Vice-Chairmen.

In May this year, BHEL had invited Expressions of Interest (EOI) from global OEM (Original Equipment Manufacturer) firms to leverage its facilities as well as capabilities and to shift their production base to India amid the Covid-19 pandemic. The EOI was issued on the premise that there were a large number of OEM firms who intended to shift their manufacturing base from China to other countries after the Covid-19 outbreak.

In May this year, BHEL had invited Expressions of Interest (EOI) from global OEM (Original Equipment Manufacturer) firms to leverage its facilities as well as capabilities and to shift their production base to India amid the Covid-19 pandemic.

“The ongoing economic disruption across the world due to Covid-19 has highlighted the dangers of manufacturing activities being concentrated in a single location and thrown up the need for diversification of supply chains and manufacturing,” the company had said in a statement.

BHEL said this move will further promote ‘Make-in-India’ and support international companies for setting up manufacturing base in the country.

The UP government, on its part, has extended all support and assistance.The government shall provide the potential investment location plans to the company via Google Maps, with details of the land banks, surrounding infrastructure, facilities, and incentives to be provided to them by the state. Under the new push by the government for setting up manufacturing plants in India, the government’s UP Defence Corridor initiative has reportedly seen the signing of Memorandums of Understanding (MoUs) with more than 20 companies worth 50,000 crore.

The UP Defence Corridor spans over more than 5,000 hectares of land with well-connected transportation systems along the country’s national highways and state expressways.

According to the state government, Rheinmetall officials reaffirmed interest in the Defence Corridor and said the company would consider the proposed sectors of investment discussed in the virtual conference.

The state had planned to host a Global Investors Summit in October-November 2020, for which roadshows in major foreign countries, including the US, the UK, Russia, UAE, Canada, France, the Netherlands etc were also proposed, before the global Covid-19 lockdown put a spanner in the works.

Speaking of the corridor, Additional Chief Secretary, MSME, Navneet Sehgal said, “There are six nodes along this corridor with a proposed area of 5071.9 hectares. Major progress has already been made in land acquisition across all nodes. The industry will be supported through a strong defence ecosystem with five ordnance factories and three units of Hindustan Aeronautics Ltd (HAL)”.

On August 14, Uttar Pradesh CM Yogi Adityanath’s government formed an entity, ‘Invest UP’, to promote investments in the state. Its Chairman is Chief Minister Yogi Adityanath with Industries Development Minister Satish Mahana and MSME Minister Siddharth Nath Singh as Vice-Chairmen.

On February 5, 2020, Prime Minister Narendra Modi had inaugurated India’s largest ever Defence Expo 2020 in Lucknow and set the target of defence export worth $5 billion worth of defence exports in the next 5 years and the Yogi Adityanath government is aiming to become a hub of military hardware and aviation manufacturing by promoting the Corridor to investors, including foreign majors.

The Defence Corridor is among the flagship projects of the Adityanath government apart from Purvanchal Expressway, Bundelkhand Expressway, Gorakhpur Link Expressway and Ganga Expressway. A total of 5,125 hectares of land has been proposed for the six nodes of the corridor spread across Lucknow, Kanpur, Chitrakoot, Aligarh, Agra and Jhansi districts. The development of the corridor is being handled by the UP Expressways Industrial Development Authority (UPEIDA).