OPERATION TURNAROUND

ANIL AMBANI'S audacious defence foray, once mired in debt and doubt, has entered a new phase. With marquee partnerships with global defence giants and a sharpened focus on exports, Reliance Defence is positioning itself as a key player in India's military-industrial resurgence

- By Arjun Yadav

IN SEPTEMBER 2014, the new government under Prime Minister Narendra Modi launched 'Make in India' to transform the country into a global manufacturing hub. A key pillar was defence, encouraging private sector participation to reduce dependence on imports and challenge the dominance of public sector undertakings. Five months later, on 12 February 2015, Anil Ambani's Reliance Infrastructure informed the stock exchanges that it was setting up three wholly owned subsidiaries: Reliance Defence Systems, Reliance Defence Technologies, and Reliance Defence and Aerospace.

The company mentioned that these subsidiaries have been set up “to pursue growth opportunities in the defence sector”.

Defence Sector Foray

The entry into defence came when Reliance Group was under financial stress, with profits declining due to high finance costs and losses in other businesses. To pare debt, Reliance sold its cement business to Birla Corporation, freeing capital to focus on defence as a core growth area.

In March 2015, Reliance acquired an 18 per cent stake in Pipavav Defence for Rs 819 crore, marking its entry into high-end defence manufacturing. The acquisition enabled Reliance Infrastructure to enter the defence manufacturing sector, encompassing warships, submarines, aircraft carriers, and civil structures such as oil rigs.