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Larsen & Toubro (L&T), Mahindra & Mahindra (M&M) and Tata Power are eyeing for a slice of the Rs 2,000 crore (Rs 20 billion) domestic defence market which is being opened up for private participation.
Companies are anticipating business opportunities from a number of army regiments, navy, airforce and from institutions such as the Defence Research & Development Organisation, Indian Space Research Organisation and Hindustan Aeronautics Ltd.
"There is a distinct possibility of the defence sector to open up in the immediate future. If that happens, there will be Rs 2,000 crore opportunity for Indian players. L&T is readying up to capture a good market share in the defence segment," said K Venkataramanan, president (operations), L&T.
The current defence market for the private sector is estimated to be about Rs 800 crore (Rs 8 billion).
L&T is already working for the Indian navy. The company is currently developing rocket launching system and underwater vessels for the navy.
It is also involved in developing components and systems for DRDO and Hindustan Aeronautics and rocket motor casings for ISRO.
It is learnt that Tata Power have already developed prototype for the Pinaka launcher. Defence arm of M&M, Mahindra Defence Systems, is making defence vehicles for the army, components and systems, and IT solutions in the field of simulation surveillance and e-security.
The company has tied up with Israel Aircraft Industries to jointly fabricate a border surveillance vehicle incorporating a mobile radar, all weather video camera, GPS and required communications.
India opened its defence production to its private sector in 2001, allowing foreign direct investment up to 26 per cent. Recently, the Centre formed a panel, chaired by Vijay Kelkar, to study the ways of integrating India's private sector with India's defence industry.