A Black Cat commando checks out a rifle at the Russian pavilion at Defexpo 2008. (PTI)

New Delhi, Feb. 19: The Tatas, Mahindras, Larsen and Toubro and the defence public-sector Bharat Earth Movers Limited have positioned themselves at the top of corporate India’s efforts to tie up with global arms majors to reap the benefits of an offsets policy that the government hopes will lead to increased foreign funds flow.

A liberalised offset regime — for reinvestments flowing from contracts — is likely in a revised defence procurement policy due in April. Defexpo 2008, India’s largest arms trade fair that ended here today, saw 20 memoranda of understanding signed between Indian companies and foreign firms.

The MoUs are statements of intention that the companies want to get together and invest and do not represent contracts or firm orders.

India is projected to buy arms worth nearly $30 billion over the next five years, a large portion of which would be through joint ventures and co-production arrangements.

The Confederation of Indian Industry director-general and former western army commander, Lt Gen (retired) S.S. Mehta — who supervised Defexpo 2008 — said the exhibition was a reflection of the technology that was coming into India, rather than of business contracts.

But the Tatas, in particular, have chosen Defexpo as the forum to showcase their willingness to expand their business in the defence sector.

Tata Advanced Systems signed an MoU with Sikorsky to make S-92 helicopter cabins. Israel Aerospace Industries and the Tatas have also signed an MoU for an unspecified number of military hardware and software projects.

The Mahindras have tied up with Italian firm Whitehead Alenia Sistemi Subacquei, a subsidiary of Finmeccanica, which makes maritime underwater systems. Anand Mahindra said the investment would be about Rs 50 crore to begin with.

Larsen and Toubro has signed an MoU with European aviation consortium EADS and another with Boeing. L&T is also taking a hard look at an Indian Army tender for 185 wheeled self-propelled artillery guns (155mm/52calibre). A model of the system displayed at the L&T stall showed a Samsung K-9 turret mounted on a Beml/Tatra chassis.

The defence public-sector Bharat Earth Movers Limited, which makes heavy chassis for the armed forces mostly in association with Tatra, has signed an MoU with Canada’s General Dynamics to make a four-wheeled armoured patrol vehicle and another with the UK’s WFEL to make dry support bridges.

Defexpo 2008 also reflected a growing public interest in military equipment. Mehta said there were 40,000 business visitors to the fair this year, up from 24,500 in 2006. Although Defexpo is billed as a land-and-naval-systems exhibition, aviation companies also participate and showcase their wares.