India’s Kalyani Group entered into a substantial joint venture with Israel’s Rafael Advanced Defense Systems, to manufacture advanced missile and weapons systems, and armor solutions for Indian, and subsequently global customers of Rafael, at a facility near the the southern Indian city of Hyderabad.

rafael - SIBAT

Kalyani managing director B.N. Kalyani said his company would hold 51 percent of the venture, in one of the first such partnerships since Infia’s Prime Minister Narendra Modi eased rules on foreign ownership in the defense industry sector last year, according to AFP.

The deal was announced at an aviation industry conference in the southern city of Bangalore where the bosses of hundreds of defence firms have gathered seeking lucrative contracts with India.

India, which has long been the world’s largest buyer of defence equipment, is in the midst of a multi-billion-dollar upgrade of its ageing military hardware.

At the opening of the air show on Wednesday, Modi vowed to end India’s status as the world’s number one defence importer, saying he wanted 70 percent of hardware to be manufactured domestically by the turn of the decade.

Israeli Defence Minister Moshe Yaalon met with Modi in New Delhi on Thursday after attending the show’s opening, where he said Israel was willing to work in joint production and development with India.

“This visit gives us an opportunity to enhance and improve our relationship,” Yaalon said at a public lecture after the meeting.

“We cooperate openly in all the areas but we have found a way to cooperate with each other behind the scenes in security,” he said without elaborating, according to AFP.

The US has the largest contingent at this year’s five-day show, held at an air base on Bangalore’s northern outskirts, with 64 companies including Boeing, followed by France, Britain, Russia and Israel.

The Kalyani Group, established in the mid-1960s, is a privately held Indian multi-national conglomerate, focused on four primary sectors: Engineering Steel, Automotive & Non-Automotive Components, Renewable Energy & Infrastructure and Specialty Chemicals. The Group has an annual turnover of over $2.5 billion, with over 10,000 employees, and is a market leader in all its respective business segments.

Rafael develops and manufactures advanced defense systems for the Israeli Defense Forces and the defense establishment, as well as for foreign customers around the world. The company offers its customers a diversified array of innovative solutions at the leading edge of global technology, from underwater systems through naval, ground, and air superiority systems to space systems.

Rafael is the largest employer in Northern Israel with over 7,000 employees. Rafael is Israel’s second largest defense company, with 2013 sales of $2 billion, an order backlog of $4.3 billion and a net profit of $101 million.

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