Automobile manufacturers Ashok Leyland and Mahindra & Mahindra (M&M) on Monday announced their strategic

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plans for the Indian defence forces at the Defexpo 2010.

Both the companies have entered into joint ventures with two foreign companies respectively, who would help them in developing armoured vehicles not only for India, but also export them.

Commercial vehicles manufacturer Ashok Leyland signed a principles of co-operation with Paramount Group of South Africa for the development and manufacture of mine protected vehicles (MPVs) in India. The MPVs would be manufactured in one of the factories of Ashok Leyland in South India and the company would invest Rs 50 crore for this over the next one year. “The mine protected vehicles will be based on Ashok Leyland’s proven Stallion aggregates. The principles of co-operation will soon translate into an operating agreement for the manufacture of MPVs in India. We have been exporting these vehicles (Stallion) to around eight countries such as Iraq and South Africa. The cost of a MPV ranges between Rs 1-2 crore depending on the specifications,” chief operating officer and whole time director, Ashok Leyland, Vinod K Dasari told reporters.

He said the company would produce around 10 such vehicles in a day once the company starts supplying to its customers from next one year. He said that the company would also start manufacturing five-tonne ‘all terrain vehicles’ in the same plant for the defence forces in India. “Demand for such vehicles are there not only from the defence forces, but also from the paramilitaries, ministers and VIPs,” he added.

M&M meanwhile, announced naming and corporate structure for ‘Defense Land Systems India’ a joint venture between the company and UK-based BAE Systems.

“As a fully operational joint venture, Defense Land Systems India will bring real and lasting value to India’s growing defence industry. Through this, we are confident of addressing the unique requirements of Indian defence and security forces with world class product offerings,” vice chairman and managing director, Mahindra Group, Anand Mahindra said. He said JV company would also involve in a number of future artillery programmes, with an ambition to become an artillery centre of excellence in India that covers not just manufacturing but development, testing and support.

Approved by the Foreign Investment Promotion Board (FIPB) of India, the parent companies’ initial investment will be $ 21.25 million over a three-year period. The company’s equity split will be 74 per cent M&M and 26 per cent BAE Systems as per the current FIPB regulations, he added.