Stockholm: Saab, a global provider of defence and civil security solutions, services and products, has expressed optimism about the Indian market and emphasised it was here to say. It said its presence in the Indian market would not be affected by the outcome of the Indian Air Force's 126-fighter jet global tender, in which it is a contender along with five others.
Saab officials have stressed that they are looking at a ''long and sustainable relationship with India,'' and other than the IAF's MMRCA tender were also looking at opportunities in maritime patrol and the civil security segment during the Commonwealth Games.
In the defence market, the company focuses on air, naval, land and joint operations while in the civil market, it specialises in civil security and commercial aeronautics.
In India, Saab is one of the six companies vying for the 126 multi-billion-dollar medium range multi-role combat aircraft (MMRCA) to the Indian Air Force. It has offered the Gripen NG (next-generation), with increased combat range and endurance, a more powerful engine and super cruise capability, additional weapons carriage and increased payload.
Jan Widerstrom, vice-president, Saab International India AB, says, "The MMRCA is the biggest project for us in India that is not just about selling fighter jets-we're also going to build up the know-how in India to build the next generation of defence technology... It's a different game plan; the deal has the potential to change the Indo-Swedish business model altogether. But even if the deal does not work out, we are here to stay in India. We're looking at a long and sustainable relationship with India, and have set up an office in Delhi with this in mind. We also have employees working in Bangalore. Apart from MMRCA, maritime patrol could be a big business opportunity for us in a growing market like India. On the civilian side, we're looking at providing civil security during the Commonwealth Games. We're providing support to NAL and HAL for civilian programmes and also outsourcing production of parts it India."
The Swedish company has just announced a collaboration plan with Mahindra Satyam aimed at developing operations in India for the global defence and homeland security market. The deal may eventually be worth $400 million (around Rs1,850 crore) over a five-year period.
Saab International senior vice-president Thorbjorn Gustafsson says, "It's a tough game. We've moved a bit late. But still it's a good timing. India, after recession, has taken the lead and is considered as the superpower for the future. India is special with its huge setup of local industry. And with its English-speaking, highly-educated population, India today is the most important market for us apart from Australia."
On their relations with the Indian industry, Gustafsson said, "We're focusing on building relationships with Indian industry, which is very important to start with. The public sector companies in India are very strong on domain knowledge, but are restricted due to government intervention. The private firms, on the other hand, are very aggressive and are hungry for a share of the global pie."
On the challenges in the Indian market, Widerstrom says, "The business culture is very different. Things take time, but that happens in other countries too, especially in defence deals, where the stakes are very high...We're also hoping for 49-51% FDI in our sector. But with the liberalisation of business and economy, and a 6%-plus growth rate, India is the place to be."
The company has major operations in several countries in Europe, as well as in South Africa, Australia and the US with 13,300 employees and annual sales of SEK 23 billion in 2008.