In an interview to CNBC-TV18, Sandeep Fuller, ED & CEO of Texmaco Rail and Engineering spoke about the MoU that the company signed with Russia's Rosoboronexport for defence products.
He further added that the products will be developed in Russia and made in India.
Below is the verbatim transcript of Sandeep Fuller's interview to Ekta Batra & Prashant Nair. Ekta: Tell us more about this Memorandum of Understanding (MoU), what does this mean in terms of production tie up with you?
A: Rosoboronexport happens to be the leading exporter of defence equipment and it is a Russian government company which exports all the defence equipment that are canalised out of Russia. We have a tie up with them for the manufacture of future combat vehicles, co-development of the future combat vehicles and the upgrades of the combat vehicles which are right now slated to be taking place.
We also have an agreement with them for development of ammunition for the armed forces. However, Texmaco is a leading engineering and manufacturing set up and we expect to work with them for the co-production of these items for the Indian defence sector.
Prashant: This Company is already doing the things that you described; you are entering the MoU for, modernising armoured vehicles, ammunition, etc. What are you going to do as part of this? Essentially, what I am asking is why does the Russian company need an Indian partner? If they are already supplying all these things, what is the need for the MoU from their perspective?
A: From their perspective, this is a Make in India item and they will need to do this co-engineering in India and the manufacture in India. And the manufacture in India will obviously help in developing our technologies and our capabilities in the defence sector.
Prashant: So, this is going to be built in Russia and assembled here? How will it work?
A: No, it is going to be developed in Russia, then co-engineered in India and after that, it will be manufactured in India.
Ekta: How much of your business comes from defence currently and how much of a ramp up do you expect? When does execution begin?
A: As of now, we have only been producing wagons for the defence sector which is a very small percentage of our turnover, but as time goes by, perhaps, when we developed the BMP-2s and start doing the upgrades for the Indian army, we could expect a very percentage of our turnover coming from this sector.
Prashant: Is there any capital commitment as part of the MoU? If there is none at this point in terms of actual commitment, what do you think you need to bring to the table in terms of capital to get this going?
A: We already have a very large establishment doing manufacturing. There will be specialised equipment required by way of a capital commitment and I think we are in a position to invest that much to get on those special equipments.
As far as the manufacturing capability goes, let me tell you that we have one of the best manufacturing facilities available.
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