India’s Richest Seek New Fortunes in Arms Amid China Race
By Ruth David and Karthikeyan Sundaram - Jun 7, 2012 2:31 PM ET
Indian billionaires Mukesh Ambani, Azim Premji and Adi Godrej made their fortunes in refining, software and toilet soaps. These days the moguls see big money in bullets, bombs and ballistics.
India is the world’s largest weapons importer, depending on foreign companies including Boeing Co. (BA) and MiG Russian Aircraft Corp. for about 70 percent of its $35 billion military budget. Now Asia’s third-biggest economy is revising its rules to give domestic private-sector companies a better shot at more of the spending. That’s got big Indian companies such as Premji’s Wipro Ltd. (WPRO), the country’s third-largest software exporter, setting up weapon-making units, forming new partnerships with foreign defense companies or eyeing acquisitions overseas.
“This is a sexy market with a huge capital acquisition program,” said Dhiraj Mathur, an executive director at PricewaterhouseCoopers LLP’s India unit. “The advantage the big players have is that they are large, have deep pockets and the resources.”
The tilt to domestic companies comes as India ramps up its defense budget, looking beyond its traditional rivalry with Pakistan to counter China’s rising power. India tripled military outlay over the last decade to become the world’s seventh- largest defense spender in 2011. China is the second largest at $105 billion. In the next five years, KPMG International estimates, India will seek bids for $42 billion of military hardware -- from fighter jets to artillery guns.
more:
http://www.bloomberg.com/news/2012-06-07/india-s-richest-seek-new-fortunes-in-arms-amid-china-race.html
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