MSMEs eye larger slice of defence manufacturing pie

COIMBATORE: On Monday, entrepreneurs who run micro, small and medium enterprises (MSMEs) in the city got a rare glimpse into the range and variety of machine and weapon components required by the country’s defence sector. A total of eight defence public sector units (DPSUs) and the three defence forces displayed around 400 components at the defence indigenisation expo at Codissia trade fair complex.
The expo was one of the first where DPSUs had come together under a single roof to present opportunities for MSMEs, said V Sundaram, president of Codissia. With exhibits ranging from small ammunition parts to aircraft components exhibited, entrepreneurs from the city had showed interest in making castings, sheet metal components and machined components, said representatives of DPSUs. At the expo, many entrepreneurs were seen eagerly interacting with representatives of DPSUs and filling out forms indicating the components which they were interested to produce.

Anil Kumar, junior product manager of Ordnance Factory Board, said most of the city-based MSMEs were looking to make castings and machined parts. “We have got several applications showing interest in making these components,” he said.

Ananda Kumar, production manager of Sri Venkateswara Hi-tech Machineries Private Limited, said they had been looking to get an idea of making heavy fabrication components for defence. “Many industries in the city have facilities for heavy fabrication. But we could not see any such exhibits. Several DPSUs that have come to the expo look to get castings and machined parts done from the city and carry out heavy fabrication work themselves,” he said.

“Still, there were components such as motor casings and housings used in ship yards and housing for aircraft, which involve sheet-metal fabrication that an MSME from the city can take up,” he added.

Representatives from DPSUs said while many MSMEs in the city were more than eager to manufacture and supply for the defence sector, they needed to build requisite skills. Scientists from Aeronautical Development Agency (ADA), DRDO, Bengaluru, said the two big hurdles MSMEs would face if they need to deliver for a defence aircraft manufacturing sector were the lengthy inspection processes and production volume.

“Unlike automotive manufacturing sector, aircraft manufacturing sector doesn’t require large number of components. Every year we make 10 to 15 aircrafts and we would need only as many sets of components. But each component has to go through a thorough inspection which is a lengthy process. MSMEs have to equip themselves to face this if they want to supply for defence aircraft,” said C Ranganayakulu, outstanding scientist at ADA.

However, industrialists were optimistic that though the production volume would come down by several times, the profit margin would increase, balancing it. Sundaram said the number of components required by defence sector was less, but the cost of each component was high. “For example, the defence sector might just need 200 pieces of a component. But, the cost of one piece would be around Rs 25 lakh. So, a firm would be able to make Rs 50 crore by making that one component,” he said.