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Rolls-Royce eyes IT tie-ups in India

Last updated on: November 25, 2004 17:19 IST
Rolls-Royce has expressed interest in establishing partnerships in the field of information technology in India.

Speaking at a meeting organised by the Confederation of Indian Industry in New Delhi on Thursday, Sir John Rose, chief executive officer of Rolls-Royce said the company was looking for new partnerships with Indian universities under its university technology centre programme for research and technology.

The company had about 20 partnerships in the United Kingdom and hopes to finalise some projects in India in the near future. Sir Rose said the company invested $1 billion annually in R&T as it focussed on value-added engineering and innovation. Nearly 60 per cent of its R&T budget was spent outside the UK.

The company plans to plug into the centres of academic and research excellence in India. He said IT was a great enabler and had helped Rolls-Royce to increase productivity by 12 per cent over the last decade.

"We have algorithms to determine how engines would perform in high-stress situations and what sort of repairs they will require." Sir Rose added that Rolls-Royce had a strong license manufacturing partnership with Hindustan Aeronautics Limited in Bangalore.

The company operates in four global markets - civil aerospace, defence aerospace, marine and energy. The company also has a total of 54,000 gas turbines in service worldwide, he said.

Out of the company's annual sales of $6 billion, 50 per cent came from aftermarket services. The company with a commitment to innovation and an international focus is involved in high-value engineering as innovation contributed to a significant part of the cost of production and labour.

Sir Rose underlined the importance of partnerships in Rolls-Royce's operational philosophy. It depended on partnerships for technology, access to markets, customers and manufacturing.  The company takes time to finalise partnerships but once done, partners were in for the long term, he said.

According to Sir Rose, 70 per cent of the turbines Rolls-Royce manufactured came from the supply chain. The company had stringent conditions for selecting vendors but it had a long term understanding with its partners.

There could be opportunities for small and medium enterprises in India to participate in the company's supply chain. Sir Rose said the fastest growth in the civil aviation market was in Asia as the new generation is traveling a lot. The demand for freight is driving the civil aviation industry as well. In addition to civil aviation, Rolls-Royce also has long standing defence contracts in the region as well.

Speaking on the occasion, Phiroz Vandrewala, executive vice president of Tata Consultancy Services, said the chief executive officers of British companies need to consider investing in India. British companies enjoyed a large degree of goodwill in India due to historical reasons and the CEOs should capitalise on this.

He said India was not in competition with China. "It is not India versus China, but rather a complementary relationship." Vandrewala said India's manufacturing sector produced goods worth $45 billion in the last financial year. This was expected to rise to $300 billion in the next 10 years.

A correspondent