Allow 100% foreign-owned defence companies under automatic route: Thales

India should allow investments in defence sector under the "automatic" route from companies that are 100 per cent owned by foreign firms, while maintaining export control safe guards, to boost indigenous defence capabilities, Pascale Sourisse, senior executive vice-president, international development, Thales, told Business Standard in an interview.

- DEEPAK PATEL

According to Indian government rules, foreign companies can invest in the defence sector in India under the automatic route only if their stake does not exceed 74 per cent. Increasing ownership beyond 74 per cent makes the process more complex and requires multiple government approvals.

"Thales is headquartered in France. If we want to invest in any other European country, there are no limitations at all whatsoever. There are no limitations in the US or Australia either, where our subsidiaries are 100 per cent owned by Thales. So, we think that, going forward, if India wishes to facilitate the expansion of global players in the field of defence, it would be good if they would not limit the economic ownership of defence investors in India," Sourisse said.