Tata-Airbus C295 Project: A Transformative Step for India’s Aerospace and Defence Manufacturing

The inauguration of the Tata-Airbus C295 project in Vadodara heralds a landmark achievement for India’s aerospace sector. This initiative marks the first time a military aircraft will be manufactured by a private company within Indian borders, showcasing a significant leap toward self-reliance and aligning with the spirit of Aatmanirbharta promoted by the Make in India initiative.

A New Era in Aerospace Assembly

The C295 project introduces the first truly private aerospace assembly line in India, shifting from traditional manufacturing to a comprehensive process that includes assembly, testing, and delivery. This innovative model ensures that every phase of the aircraft’s production is firmly rooted in India, with over 18,000 domestically sourced parts playing a crucial role. This commitment to engineering excellence highlights the vast potential of Indian talent and resources, setting the stage for future advancements in the aerospace sector.

Significant Employment Generation

The collaboration between Tata and Airbus is poised to create substantial employment opportunities. The project will directly generate over 3,000 jobs at various locations, while also supporting more than 15,000 indirect jobs throughout the supply chain. Each aircraft’s assembly is expected to require over one million hours of labor from Tata Advanced Systems Limited (TASL) and its suppliers. This influx of job creation will not only stimulate the local economy but also cultivate a skilled workforce capable of meeting the demands of modern aerospace engineering. The project will also benefit small businesses, such as tea stalls and restaurants, which are likely to see increased activity around the plant.

2026: A Landmark Year for Manufacturing

By 2026, India will witness the rollout of its first indigenous C295 aircraft from the Vadodara facility. This milestone signifies a transformative shift in India’s defense capabilities, with the Indian Air Force (IAF) expected to have a fleet of 56 state-of-the-art C295 aircraft by 2031. The integration of these versatile aircraft into the IAF’s operations is set to enhance national security and improve the air force’s operational readiness in the coming years.

Strengthening the Aviation Ecosystem

The new assembly line in Vadodara serves as a catalyst for the growth of local industries. This initiative will promote the development of ancillary sectors involved in component manufacturing and service provision. The establishment of a Stick Holding Depot in Prayagraj and a Training Centre at the Air Force Station in Agra further illustrates the holistic development of India’s aviation ecosystem, creating a comprehensive network of support that extends beyond the assembly line.

The C295 aircraft are designed to excel in a variety of operational environments, making them particularly suited for navigating challenging terrains. Their versatility ensures they are mission-ready for an array of tasks, including troop transport, medical evacuation, and emergency operations. By facilitating swift access to remote and critical areas, the C295 significantly enhances India’s tactical capabilities.

India’s Rising Profile in Global Defence

In recent years, India has evolved from being primarily a defense importer to establishing itself as a notable exporter within the global arms industry. The Stockholm International Peace Research Institute (SIPRI) ranked India among the top 25 arms exporters for the first time in 2019, positioning the country at 23rd overall. With ambitious targets set for defense exports, India aims to reach ₹35,000 crore by 2025.

Key Milestones in Aatmanirbhar Defence

1. Substantial Defence Budget Growth: India’s defense budget has experienced remarkable growth, increasing from ₹2.03 lakh crore in 2013-14 to ₹5.93 lakh crore in 2023-24. This financial commitment has supported advanced equipment acquisition and technology development, contributing to the highest-ever defense production output of ₹1.27 lakh crore in 2023-24.
2. Surge in Defence Exports: India’s defense exports have escalated from ₹686 crore in 2013-14 to ₹21,083 crore in 2023-24, covering over 100 countries. Indian-made military products, from helmets to sophisticated missile systems, are gaining recognition for their quality and reliability.
3. Reduced Import Dependency: Significant progress has been made in diminishing reliance on foreign defense procurement, with the percentage of defense spending on imports decreasing from 46% in 2018-19 to 36.7% by December 2022.
4. Policy Initiatives for Indigenization: The Defence Acquisition Procedure (DAP) 2020 mandates 50% indigenous content in procurement contracts, encouraging international manufacturers to set up production facilities in India. The Ministry of Defence has identified 346 items for exclusive procurement from Indian sources, further advancing the indigenization effort.

Infrastructure Investments and Strategic Partnerships

1. Establishment of Defence Industrial Corridors: India has created two major defense industrial corridors in Tamil Nadu and Uttar Pradesh, attracting investments of ₹7,000 crore to build an ecosystem that supports indigenous production.
2. Strategic Collaborations: The C-295 manufacturing partnership with Spain and Tata Advanced Systems exemplifies successful international collaborations in India’s defense sector, alongside joint ventures with global entities like Lockheed Martin and Safran.
3. Indigenous Naval and Air Platforms: India has made strides in naval capabilities with the indigenous INS Vikrant aircraft carrier, the largest warship in its maritime history. Additionally, Asia’s largest helicopter manufacturing facility in Tumakuru enhances the nation’s aviation technology.

Empowering Startups and MSMEs

Under PM Modi’s vision, small businesses and startups are increasingly contributing to the defense ecosystem. A budget allocation of ₹1,500 crore in 2024 for startups and MSMEs underscores the government’s commitment to fostering homegrown innovation. Approximately 8,000 MSMEs currently operate in the defense sector, with plans to double this number.

The Innovations for Defence Excellence (iDEX) initiative has facilitated participation from over 400 startups and MSMEs, resulting in the indigenization of 35 items worth ₹2,000 crore.