HAL- Future Role: Should HAL follow the path of ISRO?

HAL has been on the for-front of making and upgrading fighter jets and helicopters for Indian Military since beginning. It has demonstrated critical capability by designing and developing LCA Tejas, ALH Dhruva, Rudra, LCH and trainer aircrafts (HTT-40). It has majority share of indigenously manufactured aircrafts and plays a key role in manufacturing and upgrading imported aircrafts like Sukhoi-30MKI, Mig 29-UPG and Mig 29K, under license.

We see Indian air force consisting of a rainbow of aircrafts imported or made under license from other nations. Here HAL plays a key role in increasing indigenous content of these aviation systems with time. But by the time the indigenous content increases to more than 50%, these aircrafts systems tend to become obsolete. So the hard work done in getting transfer of technology cannot be used on the same aircraft but can be used in design and development of new systems. 

With time the key strength of HAL is R&D and the ability to satisfy diverse needs not only of air force but the aviation arms of whole military. So using its time to support and maintain old aviation systems is lowering its productivity and the ability to deliver new systems like LCA Tejas MK 2, S.P.O.R.T., ORCA, AMCA and Twine Engine Deck Based Fighter. To increase the scale of delivery of Tejas Mk 1 and Mk1A, HAL has added new production lines in 2020 but has still delivered much less aircrafts than planned.

For the innovation and design of component systems and aircrafts HAL collaborates with DRDO, ADA, GTRE and foreign players. For engines it has worked with foreign players like GE and Safran. The result is unmatched strength in innovation, design, development and prototyping of new aircraft systems for airforce, army and navy. 

But it is slow in operationalization of the developed technologies as that involves management of diverse vendor base. It is because that takes away the focus from design, development and prototyping to management. On the other hand, the Indian private players have the key strength of management rather than R&D. This does not mean that HAL does not deliver or has to give up to private players.

Rather HAL needs to scale up delivery of latest technologies and aviation systems to Indian military in this decade like never before. For this HAL should play to its strength along with DRDO and other government organizations. HAL's strength is at the top the value chain i.e. design, develop and demonstrate prototyping of new aviation systems. While the private players can play majority role in the operationalization of these new systems. Once HAL helps to develop the technology demonstrator for Indian Air Force, then (or before) private players should step in. Private players can be used to scale up manufacturing as HAL being a PSU cannot hire/fire at will.

So using this business plan, will have multiple benefits for HAL and India as follows:

1. HAL's team of key scientists can be used more productively to finalize the requirements from Indian Military from concept to demonstration.

2. The mundane details of integration of imported weapon systems like missiles and bombs can be done more efficiently in detail by private players who can collaborate with foreign players and other Indian vendors. 

3. Private players can manage the production lines and maintenance of aircrafts and helicopters already developed. Here involving HAL till IOC/FOC clearance will help to make freeze requirements for private players. So everyone involves knows exactly what is expected to be delivered in concrete, measurable form. 

4. The competing bids can be decided more accurately as all private vendors will have to agree to deliver the same product. So Indian military won't have to compare apples and oranges or worse.

5. Then private players can take over and deliver the final products and scale up or scale down as demand increases or decreases from Indian military.

6. Private players won't have to pay for technologies which India has already developed under different PSUs, especially HAL.

7. HAL can be critical in each of the aviation projects in the dream list of Indian military. So separate projects don't have to be created to avoid HAL due to fear of delays.

8. The long term prospects of HAL will be in line with private players as they can also catch up with  technology. Instead of relinquishing complete control to foreign players, HAL can take up partial ownership of the OEMs by supplying them already developed technology and aviation systems.

9. So instead of private players developing a new ecosystem which will supplement existing PSU owned facilities and competing with HAL, they can collaborate along with HAL for envisioned aircraft like AMCA and TEDBF.

10. This will prevent acrimonious situations where HAL is kept out of some contracts just in the name of developing a new defense ecosystem consisting of only private and foreign players.

11. The consistency in aircraft, helicopter and other system development can be maintained, just like F-15, F-16, F-18, F-35 and F-22 in USA. Even though they have been developed by different companies but their consistent naming suggests they are satisfying the concrete requirements of USA military. 

12. HAL being a PSU has world class team of scientists and engineers. They will be able to guide the private players who have experience in delivering and managing world class projects (L&T) and products (Tata, Mahindra etc). So the relationship will be complementary.

13. The timeline for delivery of  new fighter jet squadrons for IAF can be shortened. So instead of waiting for 5-10 years to operationalize new fighter jet technology, a few months may be needed to develop and deliver to IAF, if private players are involved.

14. More attention can be given to force multipliers like tankers, transport planes and AWACS. So instead of doing the bare minimum to support the IAF, the whole umbrella of IAF needs can be served by HAL.

15. HAL can become top-end R&D institution for aircraft and helicopters by delegating maintenance and upgrade work to private sector.

ISRO is going the same way as it opens up its launch platforms to private players. It will help ISRO to scale up and grab the space market for which it has cutting edge technologies and demonstrated reliability in space program. This does not mean it is out of any new space programs but will guide the private players to deliver on any national or international requirements.

This strategy can work wonders for HAL as it has to scale up to deliver already accepted or under development aircraft systems and helicopters. It can even earn revenue and license fees for the technologies it transfers to Indian OEMs. So HAL will always remain relevant for Indian military rather than being sidelined randomly for key projects. This will be a win-win situation for all the parties involved.

Instead of competing with private players then HAL will be collaborating with them to satisfy the needs of Indian AirForce, Navy and Army.