Sky is the limit for Indian IT, literally
ATR, Hawker, Falcon may set up R and D centres in India; third party IT cos see billion-dollar business. ET Exclusive: The art of being Nooyi
By PP Thimmaya & Urvashi Jha, TNN |
BANGALORE: With aviation majors like Boeing and Lockheed Martin looking at setting up captive R&D centres in India, smaller aircraft and business jet manufacturers are likely to follow suit. The other aircraft manufacturers like Bombardier, ATR, EADS Socata, Eurocopter, Hawker, Falcon are very seriously evaluating the option of setting up their R&D centre in India with a third party IT services provider or independently.
This move could mean a billion dollar business opportunity within the ecosystem of the aviation industry in India. These R&D centres would come under the engineering services segment of IT. A study done by NASSCOM and Booz Hamilton estimates that engineering services outsourcing could touch $40 billion by 2020 and the contribution by the aerospace segment is expected to be around 15%.
European Aeronautic Defence and Space (EADS), the parent company of Airbus is setting up a technology centre in Bangalore with investment to the tune of Rs 11,000 crore. “Eventually this centre, which will handle core projects and mission critical projects, will evolve into major technology centre for Airbus,” said a company official.
Aiding this momentum is the offset clause of the government which stipulates that 50% of $10 billion order for the purchase of 126 multi-role combat aircraft deal has to be sourced locally.
Srinivas Duvvuri, VP and Chief Country Representative, Bombardier (India) said, “Currently we have partnerships with Capgemini, Infotech Enterprises and Satyam for work like technical publication, engineering design. In the future we will look at different options to grow these partnerships, as it the logical way to grow. However at the same time, I don’t see any reason why we should not have our own operations like a captive centre in the country.”
However, the business opportunity is not just limited to the larger IT players as even the smaller entities focused on aerospace segment stand to benefit. B V R Mohan Reddy, CMD, Infotech Enterprises said that there has been significant traction in the aviation space in the last one year. The $120 million IT company gets 40% of its revenues from the aerospace segment.
According to Senthil Kumaran, MD, Silver Software, more number of aircraft manufacturers are looking to undertake R&D operations in India which will certainly boost the India based IT companies. Silver has been providing software solutions for Airbus A380 aircraft and Boeing’s Dreamliner project.
Industry observers said that there are going four main players in this R&D area: IT companies looking at focusing on aerospace segment, manufacturing companies providing engineering services, captive centres and lastly the third party services providers which are specialised in this segment. It is expected that the smaller aviation companies who come into India for R&D will typically get into an alliance with third party and later form their own captives.
This move could mean a billion dollar business opportunity within the ecosystem of the aviation industry in India. These R&D centres would come under the engineering services segment of IT. A study done by NASSCOM and Booz Hamilton estimates that engineering services outsourcing could touch $40 billion by 2020 and the contribution by the aerospace segment is expected to be around 15%.
European Aeronautic Defence and Space (EADS), the parent company of Airbus is setting up a technology centre in Bangalore with investment to the tune of Rs 11,000 crore. “Eventually this centre, which will handle core projects and mission critical projects, will evolve into major technology centre for Airbus,” said a company official.
Aiding this momentum is the offset clause of the government which stipulates that 50% of $10 billion order for the purchase of 126 multi-role combat aircraft deal has to be sourced locally.
Srinivas Duvvuri, VP and Chief Country Representative, Bombardier (India) said, “Currently we have partnerships with Capgemini, Infotech Enterprises and Satyam for work like technical publication, engineering design. In the future we will look at different options to grow these partnerships, as it the logical way to grow. However at the same time, I don’t see any reason why we should not have our own operations like a captive centre in the country.”
However, the business opportunity is not just limited to the larger IT players as even the smaller entities focused on aerospace segment stand to benefit. B V R Mohan Reddy, CMD, Infotech Enterprises said that there has been significant traction in the aviation space in the last one year. The $120 million IT company gets 40% of its revenues from the aerospace segment.
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According to Senthil Kumaran, MD, Silver Software, more number of aircraft manufacturers are looking to undertake R&D operations in India which will certainly boost the India based IT companies. Silver has been providing software solutions for Airbus A380 aircraft and Boeing’s Dreamliner project.
Industry observers said that there are going four main players in this R&D area: IT companies looking at focusing on aerospace segment, manufacturing companies providing engineering services, captive centres and lastly the third party services providers which are specialised in this segment. It is expected that the smaller aviation companies who come into India for R&D will typically get into an alliance with third party and later form their own captives.
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