NEW DELHI — India's major private sector ammunition manufacturer wants to increase its footprint in the African ammunition market and is considering setting up bulk explosives factories in Australia and Indonesia, according to Nilesh Panpaliya, the chief financial officer of Nagpur-based Solar Industries.
Solar Industries currently operates explosives plants in Nigeria, Zambia and Turkey.
"The company is planning to enhance its international footprint through a plant in South Africa," Panpaliya said. "South Africa is the largest mining country in Africa which gives us a very good opportunity, especially when companies are looking to reduce their costs by having a competitive supplier."
Solar Industries is also "evaluating Australia and Indonesia" and would finalize plans there this year, the CFO said.
Domestically, Solar Industries is entering the artillery ammunition market, some products of which are imported due to local shortages. So far, state-owned Ordnance Factory Board (OFB) is the monopoly producer of ammunition for use by India's armed forces, which have to import a variety of ammunition to meet their needs.
To produce artillery ammunition, Solar Industries has sought a technology transfer for making bi-modular charge systems (BMCS) from the state-owned Defence Research and Development Organization (DRDO), which has experience developing this technology.
"Yes, we have applied to DRDO for technology transfer of ammunition. Details will be made available as and when we get the same," Panpaliya said.
Analysts have noted the shortage of artillery and tank ammunition, apart from varied types of missiles, identifying importing as a short-term solution.
The Indian Army plans to buy a variety of 155mm guns worth more than $6 billion in the next five to seven years, and the service needs BMCS ammunition, according to a senior Indian Army official.
OFB had once proposed to set up a BMCS factory at Nalanda in eastern India with a technology transfer from Israel Military Industries. However, the Israel-based company has since been banned on charges of alleged corruption in 2006, and stalling of the factory has led to shortages of BMCS.
India's autonomous auditing agency, Comptroller and Auditor General (CAG), in a 2015 report tabled in the Indian Parliament, said OFB can only meet 10 percent of the demand for ammunition, referencing India's acute ammunition shortage.
"OFB is the main source for supply of ammunition to the Indian Army. However, the OFB has consistently failed to supply the targeted quantity, with shortfalls ranging up to 73 percent of the total types of
ammunition indented," the CAG report noted.
Rahul Bhonsle, a retired Indian Army brigadier and defense analyst, believes the participation of private sector defense companies can help meet India's ammunition requirements.
"The monopoly of the OFB in manufacturing and the DRDO in development of higher grade munitions had prevented the entry of the private sector companies. These organizations [OFB and DRDO] have not been able to make any breakthrough in manufacturing high-grade ammunition such as bi-modular charge despite over a decade spent in development," Bhonsle said.
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Vivek Raghuvanshi is the India correspondent for Defense News.
