Make in India fighter jets? Tata, Lockheed join hands to build F-16s

Will compete for contract with Gripen E, built by Saab-Adani combine

 US defence giant Lockheed Martin and India’s Tata group signed an agreement on Monday to jointly build the F-16 Block 70 fighter in Make in India, should New Delhi opt for the American aircraft in the procurement of single-engine fighters for its air force.

Highlighting the importance of this contract for the Tata group’s aerospace and defence aspirations, Chairman Emeritus Ratan Tata attended the signing ceremony at the ongoing Paris Air Show in France.

The Tata group has earmarked Tata Advanced Systems Ltd (TASL) to build the F-16 in India with technology and manufacturing facilities transferred from Lockheed Martin.

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Coming ahead of Prime Minister Narendra Modi’s visit to the United States this month, Lockheed Martin’s inking of this joint venture (JV) – which would have required formal clearance from Washington – indicates that, despite President Donald Trump’s promises to keep skilled jobs in the US, his administration is willing to transfer the ageing F-16 production line from Texas to India.

TASL and Lockheed Martin already have a joint venture (JV) that manufactures airframe components in Hyderabad, including for the C-130J Super Hercules airlifter and the Sikorsky S-92 helicopter.

However, the manufacture of F-16 Block 70 would be a far more ambitious project. This would first require the Ministry of Defence (MoD) to select the Tata group as an Indian “strategic partner” for aircraft production. Next, the IAF and the MoD would have to choose the F-16 Block 70 as the air force’s single-engine fighter aircraft. That multi-billion dollar procurement has already kicked off with the issue of a global request for information (RFI) by the IAF.

MoD and IAF sources confirm aviation market intelligence that the IAF’s chosen fighter is likely to be either the F-16 Block 70, or the Gripen E fighter that Swedish company, Saab, has offered to India...(read more...)

From Amma's legacy to RBI monetary policy: 5 key developments

In other news, guidelines issued for cross-border electricity transactions

Business Standard brings to you a list of five key developments across the country.

Jayalalithaa’s legacy

Tamil Nadu’s 19th chief minister (she was also the 11th, 14th, 16th and 18th) J Jayalalithaa, who died on Monday, was known for gifting her 72 million people a record set of freebies, but she also leaves behind a state that ranks among India’s top five in many social, crime and industrial indicators.

ALSO READ: Amma's legacy: Social, industrial, crime rankings among India's best

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Minting money (Part– 1): Salboni

 

Business Standard reporters have attempted to piece together stories of how new currencies are being printed after demonetisation at the  four presses — Salboni  (West Bengal), Dewas (Madhya Pradesh), Nashik (Maharashtra) and Mysuru (Karnataka) — which make the notes.

ALSO READ: Minting Money: Printing notes on a war-footing to fill up cash-starved banks

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Tata vs Mistry

Alleging that individuals prone to “impulsive control” have exposed the Tata Group to perilous violation of regulatory requirements, ousted Tata Sons Chairman Cyrus Mistry on Tuesday said his fight is to protect the conglomerate from “capricious” decision-making by Interim Chairman Ratan Tata.

ALSO READ: Tata Group exposed to regulatory violations: Cyrus Mistry

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Cross-border trade of electricity

The power ministry late on Monday issued guidelines to facilitate cross-border trade of electricity. The Central Electricity Regulatory Commission will frame appropriate regulations binding on all participating entities. According to the guidelines, a participating entity will be eligible for cross-border trading on Indian power exchanges, including Indian Energy Exchange and Power Exchange India, in term-ahead contracts, intra-day contracts and contingency contracts.

ALSO READ: Guidelines issued for cross-border electricity transactions 

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RBI Monetary Policy

The Reserve Bank of India (RBI) imposed a temporary cash reserve ratio (CRR) over the weekend, on the incremental rise in bank deposits following the government’s demonetisation move. The measure, which will be reviewed on December 9 and was largely expected by analysts, aims to suck out excess liquidity in the system; though banks will not be able to earn any income on these deposits.

ALSO READ: Monetary Policy preview: Will the RBI cut interest rates tomorrow?

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Full text of Cyrus Mistry's letter on the issue of transparency at Tata Trusts

The ousted Tata Sons chairman on Monday requested govt to ensure transparency at the trusts to make them more accountable. Read full text here

In a letter sent to the six Tata group companies and their shareholders that are meeting this month to remove him as a director, ousted Tata Sons chairman Cyrus Mistry on Monday said at the heart of the sustainability of the Tata group was governance reform, which was lacking throughout the institution at present. “This would mean the Government ensuring the working of the Tata Trusts, which are public charitable trusts, the property of the people of India, have a defined, transparent governance structure,” he said asking the companies to place his letter before the shareholders.

Here is the full text of the letter:

REPRESENTATION UNDER SECTION 169 OF THE COMPANIES ACT, 2013.

IN RESPECT OF SPECIAL NOTICE FOR REMOVAL OF MR. CYRUS P. MISTRY AS DIRECTOR

Foreword

My Appointment.................

Strategy..................

Structure................

Erosion of Governance...................

Governance Breakdown....................

Flagrant Widespread Breakdown................

Way Forward...................

I therefore urge all you to think beyond the here and now. I urge you to have your voice heard loud and clear. I ask you to be a part of defining the future.

Cyrus P Mistry
[December 5, 2016]

YOUR SUPPORT MATTERS. Visit www.cyrusforgovernance.com for more details.

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Read our full coverage on Tata vs Mistry

Full text of Cyrus Mistry's letter to Tata Sons Board

While Tata Sons followed up the sacking of its Chairman Cyrus Mistry on October 24 by inducting two new directors into the board, the now ousted former chairman has criticised the board room 'replacement' in an October 25 emailed letter and termed the move as 'shocking and unparalleled' in the annals of corporate history.

According to the letter Mistry has not only described the board proceedings as invalid and illegal but also alleged that he had not been given any free hand despite being assured of the same by Ratan Tata before he accepted the top job. Mistry alleged that after he was appointed as chairman, Tata Trusts amended the articles of association which constrained his ability to engineer a turnaround. The text of the letter follows:

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From Cyrus P. Mistry
Date: 25 October 2016 at 22.05: 41

To:
Directors of Tata Sons Ltd.

I was shocked beyond words at the happenings at the board meeting of October 24, 2016. Apart from the invalidity and illegality of the business that was conducted, I have to say that the Board of Directors has not covered itself with glory.

To "replace" your Chairman without so much as a word of explanation and without affording him an opportunity of defending himself in a summary manner must be unique in the annals of corporate history. The suddenness of the action, and the lack of explanation has led to all manner of speculation and has done my reputation and the reputation of the Tata Group immeasurable harm..............................

Sincerely,
Cyrus
(Cyrus P Mistry)
C.C. Trustees of Tata Trusts

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Cyrus Mistry's exit from Tata Sons: News explained in 10 points

The board of Tata Sons on Monday replaced chairman Cyrus Mistry and brought back Ratan Tata as interim chairman for four months. In a letter to employees of the group, Ratan Tata said the board had requested him to perform the role of chairman and he had agreed to do so “in the interest of stability of and reassurance to the Tata group”.

Related Article:  Trusts withdrew Rs 4,000 crore prematurely from Tata Sons in May

Ratan Tata had been Tata Sons chairman from 1991 until his retirement on December 28, 2012. Cyrus Mistry had succeeded Tata to be the sixth chairman of the Tata group. While Mistry will remain an independent director on the board of Tata Sons – a position he held before he became chairman – he will quit as chairman of all group companies.

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Business Standard explains Mistry’s sudden exit as Tata Sons chief and how the story unfolded through 10 reports:

1. Cyrus Mistry removed, Ratan Tata returns
2. The turn of events
3. Mistry’s focus during his stint
4. Experts thought Mistry was a succession experiment gone wrong
5. ‘Business as usual’ at Tata Sons
6. The agenda for Ratan Tata
7. End of a vision?
8. An exit in a hurry?
9. For Tata trusts, was it a lack of trust in Mistry?
10. Slow equity support to Tata group firms

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Why was Cyrus Mistry sacked? Top possible reasons for his exit

Ratan Tata, patriarch of one of India's most influential families, will take over as interim chairman of Tata Sons after the salt-to-software conglomerate's board ousted Cyrus Mistry, who had sought to shake up the firm's management.

Tata, who had stepped down as chairman and was replaced by Mistry in late 2012, will head the group for four months while the company seeks a replacement.

Related Story:  Cyrus Mistry's exit: Should you buy or sell Tata Group shares?

Tata Sons is a large shareholder in a string of listed Tata Group companies - a business empire ranging from Jaguar Land Rover cars and steel mills to aviation and salt pans.

The board said in a statement on Monday it was decided "it may be appropriate to consider a change for the long-term interest of Tata Sons and Tata group."

While the board gave no detailed reason for the change, some media reports said there has been discontent with some of Mistry's actions, including asset sales.

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Here are the possible theories behind Mistry's ouster

1. Welspun acquisition
2. Management restructure
3. Vision missing?
4. Tough decision?

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