Offset concerns leave vendors uneasy

The offset requirements raised to 50 per cent with the onset of the Defense Procurement Procedure (DPP) last August, continue to make foreign defense vendors uncomfortable.

Bell helicopters had dropped out of the race to supply 197 helicopters to the Indian armed forces because of exactly this reason. The company’s Director of Communications, Greg Hubbard took StratPost through the reasons for Bell deciding against vying for the order.

“In India, Hindustan Aeronautics Limited (HAL) was the only option to be a 50 per cent offset partner for this order. But they have so much going on — they’re involved in so many projects that we didn’t want to take the on the risk of not being able to deliver on schedule as the obligation would have rested on us. So we decided not to bid,” says Hubbard.

So would these offset requirements put off vendors, who would otherwise be eminently qualified to bid for orders because of the quality of their products? “Yeah. Maybe,” he answers, adding, “I think other people have expressed concerns about the impact of the offset.”

But Bell will still be looking at getting orders from India? “We look at each and every opportunity. We want to participate and we’re hopeful of doing so in future,” clarifies Hubbard