Olesia Safronova
Ukraine’s Antonov design bureau intends, in cooperation with
Ukroboropromom, to launch a joint venture with their Indian partners for
manufacturing An-148/158 civil aircraft a civil aircraft Antonov An-148/158 and
the newest An-178 cargo plane – bypassing competitors from Russia and Brazil.
The airfield of the state enterprise Antonov near Kyiv welcomed some
very important guests just a few days before the Orthodox Easter holidays. The
Ukrainian aviators hosted one of the world’s richest people – India’s Anil
Ambani, Chairman of the Board of Directors of one of the country’s largest
private corporations Reliance ADA Group.
He got familiar with the capacities of
the Ukrainian aviation industry, held a series of meetings with the National
Security and Defense Council officials, as well as the top managers of the
state-owned concern Ukroboronprom.
Founded in 1929, Reliance ADA Group is specialized in
the implementation of various projects, including in civil and military
aviation, construction, infrastructure, energy and the development of hi-tech
industry. The company's annual turnover is about $5 billion, net profit over
$300 million a year.
Some time ago, Reliance entered the market of air
transportation, having created a special corporate division, and is now
actively searching for partners willing to share its will to become a regional
leader in passenger transportation and cargo delivery. In addition, before the
end of this year, Reliance will act as a mediator in the organization of a
competition scheduled for the second half of 2016 for the purchase of aircraft
for the Indian corporation Hindustan Aeronautics Limited, which deals with
re-arming the Indian armed forces and works closely with the country’s Defense
Ministry. The exact volume of bidding is a commercial secret, but it is clear at
the moment that it will be at least 200 units.
The scale of procurement is evidenced by the fact that
among the participants of the tender are the Russian Sukhoi, Brazilian Embraer
and Europe’s Airbus. All these companies are traditional participants in the
world's major air shows and never miss an opportunity to compete for long-term
contracts. But whether they can seal the Indian deal is a big question.
As of today, Ukraine’s Antonov has the most chances to
win the announced competition. And it’s the Indian side who talks about with no
hesitation or diplomatic antics. Mutual understanding between the Indian and
Ukrainian counterparts was reached surprisingly quickly. As everyone familiar
with the international business knows, the Asian markets have a peculiarity:
sometimes years may pass since the first contact to a real partnership. But
this time, everything is exactly the opposite. The first contacts of top
managers from Reliance with the leadership of Antonov and Ukroboronprom took
place late March 2016, and as early as in the end of April, a large Indian
delegation was already assessing characteristics of Antonov aircraft at their
home airfield.
Moreover, while the Ukrainian pilots were just completing demonstration
flights of a civil An-158 and a military cargo An-178 aircraft, the parties had
already signed three important memoranda on the mechanism for further
cooperation between the Indian Reliance Defence Limited and Ukrainian
state-owned Antonov, Ukroboronprom, and Spetstechnoexport.
Anil Ambani was pleased to note that after just a few
weeks of getting in contact, the parties are already talking about strategic
partnership, stressing that this partnership is between the SOEs and the
private sector, as Reliance ADA Group is a private Indian company.
He also stressed that India has a great potential in
the development of civil and cargo air transportation. Mr. Ambani expressed
hope that India will soon see “a new Ukraine” – intellectual, well-developed,
capable of fruitful cooperation. Calling Ukraine India’s long-standing and
reliable partner, the Indian businessman said that this partnership is
beneficial to both parties.
For Ukrainians, the declared partnership is not just a matter of
interest, it is a potential gold mine, which will not only help maintain own
production capacities, but also to export intellectual and technological
product with high added value, of which the authorities speak at various
investment forums and conferences. Moreover, it is the original, and already
certified, branded product, with the excellent record in the Indian market
since the 1980’s.
"The visit of the Indian delegation is
undoubtedly a landmark event for us,” first deputy secretary of the NSDC Oleg
Hladkovskiy has told the reporters. “The documents signed today means orders
for enterprises, access to new markets, and new areas of cooperation. We are
already talking about the possibility of creating joint ventures, implementing
joint projects, and not only in the aviation, but also in the field of
modernization of armored vehicles, manufacturing, and marketing of the turbines,
as India has been our long-term market in this area."
In turn, head of the state company Spetstechnoexport
Pavlo Barbul said that the parties to the joint aviation project with the
Indian partners are expected to show the first results before the end of this
year. "We know our competitors, we know what we can offer and we
understand what we ‘fight for’,” said Pavlo Barbul.
The Ukrainian aviators hope that cooperation with
India will be fruitful and long-term, while the Indian project will become
another "backbone" project for Antonov – along with the construction
of a brand new An-132 cargo aircraft for Saudi Arabia. Antonov’s designers
often compare their aircraft with Lego sets: the unique design allows creating
various modifications, fully meeting the customers’ technological requirements
within their financial capabilities.
"We assess very positively our chances in the fight for the Indian
market. Let's not get ahead of the train, not to "jinx," but we have
a great product, and the Indians have already assessed it,” said the Acting
President of Antonov, Mykhailo Gvozdev. “Let me note one curious thing: along
with An-158 and An-178, we showed to Mr. Ambani our An-225 Mriya. In a few
days, it will make a flight to Australia with refueling in India. So, Mr.
Ambani has already given all the necessary instructions for our Mriya to be
welcomed at a high level with the participation of media. What does this mean?
Apparently, it’s about a serious attitude and a hospitable stance to us. I really
believe that we will succeed."
And they really can. Modernization of the Indian armed
forces alone provides for public spending at about $40 billion a year. Civil
transportation market is more significant: the country with a population of
almost half a billion people will always enjoy high demand for air services.
Moreover, Delhi needs medium-range passenger and cargo aircraft, capable of
operating equally well at all airfields of this vast country – from the high
mountains in the north to the desert in the south.
Antonov aircraft have already largely covered this
demand 30 years ago – both in terms of the price of the aircraft, and flight
characteristics. Until now, more than a hundred various An’s are still
operating in India, performing different aviation tasks. That's why Indian
investors keep looking for cooperation with Ukraine, and not with expensive
global giants.
It is clear that in many aspects, the joint work will have to be started
over again. Ukraine has lost its position in the Indian aviation market, having
lost its share of exports to metallurgists and sunflower oil producers. But it
is possible to restore former glory. With a total volume of Ukrainian exports
to India barely exceeding half a billion dollars a year, there is much room for
growth.
And the Indian partners can help. In the aviation
segment, they are willing to share the responsibility - to open a joint
production with the Ukrainians in India, leaving the intellectual property
with Kyiv, as well as the possibility of post-production aircraft maintenance.
For Antonov, who has been producing one or two aircraft annually in the recent
years, this will be a considerable cooperation breakthrough. And with real
cooperation come the funds for the development of new production.
Olesia
Safronova (Photos by Oleg Belyakov)
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