No biz case for India's regional jet: Rolls-Royce

Aerospace behemoth Rolls-Royce—whose engines power commercial and military aircraft world over—was keen to partner with domestic firms to build a made-in-India regional aircraft for a while now. However, the £12 billion British company believes that India may not have a “business case” to make a regional jet. “I have spoken to the government, HAL (Hindustan Aeronautics Limited), private companies; we have spoken to the Tata’s about this,” said Kishore Jayaraman, president, Rolls-Royce India & South Asia. "They are all very interested, but the question is where is the ‘business case’?”

Even though Rolls-Royce is a dominant player in the wide-body (over 250 seats) aircraft market, it has a portfolio of engines that can power smaller aircraft. “The struggle we have always had is that we have the engines to power an aircraft (small one),” said Jayaraman—who has been at the helm of Rolls-Royce’s India and South-East Asia operations for the last eight years. “But what aircraft do you really want—an 18-seater, 50-seater or 100-seater aircraft?” “We have to find the right business case or value for why it should happen. If you develop something for the sake of development, I don’t think it's going to work,” he added.

The idea for a smaller regional aircraft gained prominence in the country ever since the Union government pushed forth its regional air connectivity scheme under UDAN (Ude Desh ka Aam Naagrik) back in 2016. However, the scheme hasn’t been a runaway success given the number of regional airlines that started and have now shut-shop. Reason: non-viability of regional routes despite government incentives. Among the fallen was Air Deccan—whose founder Captain G.R. Gopinath is credited with having ushered in the concept of low-cost air-travel in India—in 2003.

Even as the government-owned National Aerospace Laboratories is developing a 19-seater light transport aircraft and has plans for a 70-seater commercial aircraft, the aerospace ecosystem in India is largely skewed towards pure-play manufacturing. According to Jayaraman, a lot of aerospace manufactures in India are exporters, who form a key part of the global aerospace supply chain. “And the supply chains come through technologies that are given to manufacturers called build to print. So really there is no technology creation. When you don’t have technology creation in the supply chain, anybody can shut down anytime,” said Jayaraman. Many factors such as global slowdown in air travel—as seen during the pandemic—geo-politics, changes in rules, regulations and tariffs in a country, he added, have an effect on pure-play suppliers.

“The automobile sector in India — look at the number of cars, the value chain around it, it’s self-sufficient,” he said. Looking back, Maruti (the car), he added, was brought to India through collaboration and then the technology was indigenised. “Similarly, we have to do this in other areas and not just rely on the assembly and supply part of things. We need to create portions of technology, a1nd that didn’t happen when we looked at a regional aircraft (in India),” he said.