Tatas-Rafale deal a win for Make in India. But is it enough for India's defence dreams?

“The production of the complete Rafale fuselage in India underscores the deepening trust in Tata Advanced Systems’ capabilities and the strength of our collaboration with Dassault Aviation,” said Sukaran Singh, CEO and MD, TASL. “It also reflects the remarkable progress India has made in establishing a modern, robust aerospace manufacturing ecosystem that can support global platforms.”

Apart from the fuselage for Rafale, TASL manufactures aerostructures, metallics, and composites for the likes of the Chinook and Apache helicopters and Lockheed Martin F-16 and C-130J aircraft in India. In the case of commercial aircraft such as the Airbus A320, A350 and Boeing 737 and 787, the company makes vertical fins, floor beams, and wing panels.

However, in most cases, the company manufactures them under a license agreement, which does not see the transfer of technology, effectively making it a contractor. The company is building 40 Airbus C295, a new-generation tactical airlifter that’s meant to replace the aging fleet of the Avro Hawker Siddeley HS-748 twin-turboprop aircraft, which the Indian Air Force has used since the early 1960s.

“In certain areas, we do what is called ‘Build to Print’, like the C295,” Singh had told Forbes India in an interview earlier. “It’s someone else's design, but we are getting the manufacturing, and it is obviously next best to design-to-manufacture. But manufacturing, very importantly, allows you to build the ecosystem, which is essential.”

Also read: Can HAL deliver on its promises?

Why India needs more

Specifically in the case of fighter jets and defence aircraft, India has been struggling for decades with designing and developing them within the country. The country is an importer, with its Air Force fleet primarily comprising the likes of the France-made Dassault Rafale and Mirage, Russian-made MiG-21 and Sukhoi 30, in addition to the American-made Hercules C-130 J and C-17, Apache and Chinook helicopters. The only exception is the Made in India Dhruv helicopters and Tejas fighter jets, both of which have had their fair share of troubles. The Tejas production has been seriously delayed, while the Dhruv helicopters often find themselves grounded. Both the Dhruv and Tejas are made by HAL, the country’s largest aircraft maker.

“Even with local production of foreign-designed aircraft and helicopters, relying on imports to meet the Indian military's vast rotorcraft needs would be unwise,” Abhijit Apsingikar, senior analyst at global consultancy firm GlobalData had told Forbes India. “Such an approach would only increase dependence on foreign governments for the operation and sustainment of these platforms.”

This week, at the 81st AGM of the International Air Transport Association (IATA) held in New Delhi, Prime Minister Narendra Modi requested aircraft makers to design in India, which would give the country an edge in defence manufacturing. Today, very few countries are engaged in manufacturing aircraft, except for the US, Russia, China, France, Canada, and Brazil. “I request all aviation players to implement ‘Design in India’ along with Make in India,” Modi said. “For the world’s leading aviation companies, India presents an excellent investment opportunity.”

Still, India’s private sector remains cautious about making such investments. “To build your aircraft, you need to design the aircraft, and that turns out to be a fairly large investment,” Singh had told Forbes India earlier. “And I think there you need government help, because as a private entity to take a billion-dollar risk is a bit much.”

It also hasn’t helped that HAL, on which the Indian government relies heavily to manufacture Tejas has become something of a disappointment with significant delays in supply. HAL is tasked with selling over 200 Tejas aircraft, including the Mk1, MK1A, and Mk2, which the company had designed.

Tejas was initially conceived in the early 1980s but faced multiple headwinds before its induction into the IAF in 2019. That’s a nearly four-decade-long wait. A typical production cycle involves the design and development phase before prototypes are built and tested. That’s followed by a limited series production and a full series production.

So far, the company has delivered 38 of the 40 Tejas aircraft that were supposed to be delivered to the IAF. Post that, the company is set to manufacture 83 Tejas Mk1A aircraft, while also starting the design and development phase for the Mk2. The Mk1A is designed as an interim aircraft between the Mk1 and Mk2, with features such as air-to-air refuelling, advanced avionics, and electronic warfare suites. HAL plans to complete the delivery of the Mk1A by 2028, with an ambitious target of inducting the Mk2 by the same year.

Of the 83 Tejas Mk1A, estimated to cost some ₹45,696 crore, 73 are fighter aircraft, with 10 being trainer aircraft. The Tejas Mk2 contract is estimated to be worth ₹67,000 crore. While the Mk1 was designed to replace the aging MiG-21 fleet, the Mk2 is expected to replace aircraft such as the Mirage-2000, MiG-29, and Jaguars.

It’s not just aircraft where India’s defence ambitions continue to face constraints. India was the world’s second-largest arms importer between 2020 and 2024, with an 8.3 percent share of global imports, according to the Sweden-based Stockholm International Peace Research Institute. While Indian arms imports decreased by 9.3 percent between 2015–19 and 2020–24, at least partly due to the country’s increasing ability to design and produce its weapons, it still has a long way to go in becoming self-reliant, thus highlighting systemic failures. 

Also read: How Tata Advanced Systems Limited is advancing the Tata group's aerospace and defence dreams

The story of TASL

The Tata group set up TASL in 2007 and, within two years, struck a deal with Sikorsky Aircraft, then a subsidiary of United Technologies Corp, to make aerospace components in India, followed by another long-term contract to assemble Sikorsky S-92 helicopter cabins.

“The first ones [contract] we got were with people like Lockheed Martin to build what is called the Empennage of the C130J,” Singh of TASL had told Forbes India. “We also got the first deal, which is the S92 helicopter.” Under the deal with Sikorsky, which would later be purchased by Lockheed Martin, TASL would manufacture the cabin for helicopters that were widely used by VVIPs across the globe, including the US president.

Today, TASL’s business comprises four arms. The aerostructure and aero engines arm is almost entirely focussed on export to global defence companies, including Boeing, Airbus and Lockheed, where it manufactures wings, fuselage, and empennage, among others. The manufacturing takes place at the company’s facilities in Hyderabad and Nagpur; TASL also provides parts to commercial airliners, including the Boeing 737 Max and the Airbus A320.

At the company’s airborne platforms and systems division, the focus is on local manufacturing and final assembly of both aircraft and helicopters. This includes the Airbus C295 aircraft, in addition to the H125 aircraft. 

The company’s defence division, based in Bengaluru, manufactures missile launchers, rocket launchers, and optronics, and has also developed Advanced Towed Artillery Gun System (ATAGS), an artillery gun system, in partnership with DRDO. The arm also manufactures electronic warfare systems and communication systems, in addition to cybersecurity solutions. The arm had recently developed the country’s first vertical take-off and landing (VTOL) loitering munition capable of launching missions up to 50 km, with real-time targeting, either by the operator or autonomously. Then, there is the land mobility business based in Pune, where it manufactures tactical and combat support vehicles in addition to logistics and light armoured vehicles. 

Now, with the contract to manufacture the fuselage for the Rafale, TASL has joined an elite group that's certain to showcase the company's growing prowess on the world stage. The question, however, remains. Can TASL take a shot at building and developing an aircraft all by itself? And if so, by when?