His movement upwards in the defence sector has been dramatic to say the least with his Reliance Defence Limited and a cluster of other companies flying forward as the virtual flagship, along with industrialist and Modi crony Gautam Adani, of the government’s Make In India program in the defence sector.
There is nothing small or tentative about Anil Ambani’s entry into the defence sector. He hired known consultants from well known defence corporates like Lockheed Martin, went on to acquire the Pipavav company and shipyard in Gujarat, and is now busy bidding for defence licenses covering a wide expanse of weapons, ships, landing platforms and helicopters.
In recognition the government has pulled out the plugs to facilitate Ambani’s movement forward. Just recently the Maharashtra government allotted 289 acres of land in Nagpur to his Reliance Aerostructure Ltd. Anil Ambani himself admitted that the allotment has set a record of sorts being quoted in the media as saying, “We started on 16 June 2015 with the first presentation and in less than 10 weeks we got the land. This is a record.”
This land will contain the Dhirubhai Ambani Aerospace Park (DAAP) that will manufacture fixed wing aircraft, aerostructures for commercial transport aircraft and helicopters for both military and commercial use. The current investment being quoted for the development of the Park as the centre of a smart city with all facilities is $ one billion. Anil Ambani is already in queue for two huge helicopter projects with the Russians and the French.
Reports suggest that even though the land has just been allotted and signed for, with the facilities still to be constructed, Anil Ambani is already looking to secure some lucrative contracts worth over Rs 25000 crores. These include surveillance helicopters, and Naval utility helicopters.
Anil Ambani has also announced an investment of an additional Rs 5000 crores in the Pipavav shipyard over the next few years to make it a one stop shop for all Indian Navy’s requirements including aircraft carriers, submarines and frigates. This comes after Pipavav signed an agreement with the Russians for medium refits and life certification of 877 EKM submarines in India. It is of course, being showcased as part of PM Modi’s “Make in India’ programme.
In a whopping $3.5 billion deal Pipavav has been selected by the Russians to build frigates in what is being seen as the biggest warship project in the private sector. Reports quoting official sources stated that the public sector Cochin Shipyard was passed over in the process, with the Russians selecting Pipavav in Gujarat over the Cochin Shipyard in Kerala and Larsen and Toubro’s unit at Ennore. The final seal to this agreement is expected to be given by the two governments.
Pipavav Defence has also inked an agreement with a Singapore based company Augur Overseas Operation to manufacture defence aerostat and aeroships.Reliance has a 51 per cent share, and this is seen as a ‘visionary’ project as the aerostat —part of the equipment for border surveillance—market is expected to rise substantially over the next decade.
Anil Ambani is a frequent travellers with Prime Minister Narendra Modi during his visits abroad, being part of the business delegations. The grapevine buzz now places him far ahead of his more successful brother Mukesh Ambani, insofar as political clout is concerned given his proximity to the PM and his fast expanding defence interests. He has been a vocal advocate of the Make in India program and started his journey upwards shortly after being nominated as one of the nine celebrities by the Prime Minister for his Clean India campaign last year. Others included Sachin Tendulkar, Priyanka Chopra.
Ambani has been taking care to respond to PM Modi’s initiatives, the more recent being his decision to give up cooking gas subsidies. While he joined a host of industrialists like Anand Mahindra, Gautam Adani and Mukesh Ambani he went a step further by directing his groups one lakh employees to do the same. This did create a stir as the comparison between the paid employee and the top baron was drawn pretty starkly in sections of the social media. But it placed Anil Ambani firmly in the media headline.