File photo of Light Combat Aircraft Tejas

BENGALURU: Conceding that its employees trained to work on fixed wing aircraft will see a reduction in work once it delivers the remaining Su-30 MKI planes Su-30 planes, HAL has now decided to open a third manufacturing line of Light Combat Aircraft (LCA) Tejas at its Nashik facility, which so far has only made the Su-30. The last Su-30 will be delivered by March 2020.

TOI had reported earlier that with the Hawk and Jaguar projects already completed and just 23 of the Su-30s pending delivery, thousands of HAL workers will have little or no work until new orders come. HAL CMD R Madhavan, on Friday said: “While the repair and overhauling work at Nashik will still be there, it is true that a section of those workers will have no work. So we’ve decided to start a third LCA line at Nashik.”

The operation of the third line, however, depends on HAL getting the orders for 83 Tejas cleared by the Defence Acquisition Committee (DAC), which is currently stuck with the Cost Committee set up by the Centre, which feels that the cost quoted by HAL is too high.

“We’ve submitted all clarifications to the committee. You cannot compare the cost of the IOC (initial operational clearance) configuration, which had nothing to the FOC (final operational clearance) configuration which has a lot of new equipment added. The cost has gone up because of that. Now, if you want the moon, you will have to pay for it,” Madhavan said.

He did not, however, give out details of what HAL had quoted for each Tejas. HAL is already spending Rs 1,300 crore to augment LCA production and make 16 aircraft annually, and the third line will be part of this. “With that we hope to achieve an annual production rate of 20 planes a year,” he said.

At present HAL has orders for 40 Tejas—16 in IOC configuration and the remaining in FOC configuration—and orders for the 83 is important for the PSU to keep its production going. Madhavan said that on the rotary wing side, the PSU has enough orders to keep its workforce engaged, as reported by TOI earlier.

“We are also hopeful of bagging order for the light combat helicopter (LCH) and the light utility helicopter (LUH) in the future besides the Kamov helicopters which will be a joint venture with Russia ,” he said.

IAF pays due partly

Madhavan also confirmed that the PSU has more than Rs 7,000 crore dues owed by the armed forces—more than 70% of which must come from cash-strapped Indian Air Force (IAF)—and that this payment would make its cash position better.

“Just a few days ago the IAF paid Rs 2,000-odd crore which has helped our cash position, and we will be in a better position once the remaining is paid too...the army and navy owe us a negligible amount,” he said.

Order Books

While conceding that the company could do with more orders than its book reflects, Madhavan said: “We generally like to have an order book that would take care of sales for about five to seven years, but the Rs 62,000 crore or Rs 64,0000 crore we have now is enough only for three-and-a-half years. That said, we are hopeful that the LCA and LCH orders come through soon,” he said.

