Business

Indian deal won't put Belfast jobs at risk says Thales director

Thales makes its Starstreak missile systems in east Belfast.
Thales makes its Starstreak missile systems in east Belfast.

A POTENTIALLY lucrative deal signed by Thales in India last week will not open the door to the outsourcing of Belfast jobs to Asia, a senior figure at the defence firm has said.

Thales, which employs around 500 people in the east of the city, described the teaming agreement with India’s state-owned Bharat Dynamics Limited (BDL) as a vehicle for major new contracts for its Starsteak missiles.

The agreement puts Thales at the front of the queue for major new defence contracts in India, which would trigger an initial ramp up of production at its Belfast factory, where the surface-to-air missiles are made.

Evan Evans, Thales’ regional director for Middle East and India, said such a deal is unlikely to be secured for around 12 to 18 months.

But the arrangement will eventually see 60 per cent of the missile system manufactured in India.

Mr Evans said the key systems will still be made in Belfast. He said it would also take BDL some time to put itself in that position, meaning most of the work being done in Belfast in the early days of a contract.

“In the initial part of the programme, Thales will have to ramp up our own production of Starstreak to be able to meet the demand, whilst we build BDL to have the capability to deliver the weapons systems.

“We would still continue to have our own assembly capability in the UK and we would still be supplying the weapons systems for programmes outside India.”

He said the deal also means India cannot sell Starstreak systems onto a third country without UK approval.

Mr Evans said the arrangement would not mean an outsourcing of labour to India. But he accepted that it could eventually see Indian-made components being used in the Belfast factory.

“For every missile that is produced, whether in India or in Belfast, they will always have our guidance and control system in there.

“We’re protecting the area we’re most interested in and we’re retaining that capability," he said.

“Whatever the Indian team make, will be sub-systems or components that we buy in already.”

The regional director said the key driver for the agreement is opening access to the lucrative Indian market. India now has the world’s third largest defence budget, spending €65-70 billion each year.

But New Delhi has said it will no longer import certain armaments, including missiles.

That has left a technology deficit, with Thales is among the companies to step into the void.

“The market for a weapon system like Starstreak in India is one of the biggest in the world,” said Mr Evans.

“To get access to that, we need to go down this path, forming a relationship with an Indian supplier to be able to produce the weapons systems.

“By getting ourselves in this position with BDL, we’ve placed ourselves ahead of the competition to win an opportunity in India.”