India Today – October 08, 2018

28 INDIA TODAY OCTOBER 8, 2018

was spreading himself too thin.
The Indian military, the world’s
largest arms importer with projected
buys of over Rs 15 lakh crore of defence
hardware over a decade, offered endless
potentia l. What the Power point presen-
tations don’t mention, however, was the
bureaucratic maze of the monopsony,
where the government is the sole buyer
with an interest in preserving the mo-
nopoly of its gigantic defence PSUs and
ordnance factories.
Time and cost overruns are routine
and, contrary to popular perception,
contracts are intensely process-driven
and subjected to such rigorous scrutiny
that several of them are scrapped and re-

tendered at the last leg, even at the cost of

national security. It is a business that, as

one CEO puts it, requires “tremendous

stamina, very deep pockets and enor-

mous patience”.

Anil Ambani’s entry raised eyebrows

because by 2015, his group companies

were bleeding because of competition

and indigestible expansions post 2010

(see Shrinking Star). Ambani possi-

bly saw the defence sector as a lifeline,

particularly since the ‘Make in India’

programme announced by PM Modi on

September 25, 2014, aimed to make In-

dia a global manufacturing hub, includ-

ing for armaments.

The official at Reliance Defence says

the company zeroed in on Russia and

Israel for joint ventures. They signed

MoUs to make Russian helicopters and

frigates in India. “Europe was never our

focus,” he says. It became one when PM

Modi went to Paris in April 2015 and

Anil was there as part of 24-member

delegation on the Indo-French CEOs’

Forum. He is believed to have already

been in talks with Dassault. In August

2015, Reliance Aerostructure Ltd had

been allotted 289 acres in the MIHAN

(Multi Modal International Hub at

Nagpur) SEZ, where the group agreed

to undertake the defence and aerospace

project named Dhirubhai Ambani Aero-

space Park (DAAP).

SHRINKING STAR

Intense competition and indigestible
expansions post 2010-11 have seen Anil
Ambani’s companies in free fall

QUID PRO

QUO?

Did Reliance

Entertainment

part-finance

Hollande’s partner

Julie Gayet’s film to

corner the offsets

from the Rafale deal?

TO THE TOP Press

release and poster

for the Indo-French

production

Total market value of Anil Ambani's

Reliance Group companies

(as on September

24, 2018)

`

42,550^ cr

`

4,02,467cr

Aggregate peak market values

(Jan-Feb 2008) of Reliance

Power, Reliance Infra, Reliance

Comm., Reliance Capital

All figures for 2017-18

#Market valuation; ^PAT: Profit After Tax
*For a finance company, higher debt indicates it’s doing well **Standalone data

Total income 748 cr Loss1,012 cr
Total debt `10,690 cr

Reliance Naval and
Engineering (RNEL)

` 948 # cr

Total income

`1,671 cr

PAT ` 181 cr

Total debt

`13,120 cr

Reliance

Home

Finance**

Total income 4,684 cr (^)2,634#cr
Loss 23,912 cr Total debt47,234 cr
Reliance
Communications
3,568#cr Total income1,815 cr
PAT 522 cr Reliance Nippon Life Asset Management Company 11,261#cr
Total income
10,123 cr PAT^1,035 cr
Total debt 31, 697 cr Reliance Power 7,6 4 4#cr
Total income
19,898 cr (FY 2017-18) PAT1,234 cr
Total debt 46,400 cr Reliance Capital* 8,055#cr
Total income
28,778 cr PAT 1158 cr
Total debt 23,144 cr Reliance Infrastructure 8,442#cr
Reliance
Entertainment
(unlisted)
Graphic by TANMOY CHAKRABORTY