49% ownership rule blocking FDI in Indian defence sector, says Airbus chief

Government rules restricting foreign ownership in the Indian defence sector to 49% are undermining New Delhi’s drive to attract investment in the country’s manufacturing industries, a senior executive at European conglomerate Airbus Group claimed yesterday.
Pierre de Bausset, president of Airbus Group India, said his company needed to own a majority share in joint ventures to justify more investment and the transfer of key technology to Indian firms desperate to learn to build everything from fighter jets to transport planes to weapons systems.
“Fair business means that we need to have levels of control that are appropriate for the risk we are taking. Setting a limit at 49%….is not going to cut it,” he told reporters at an event in New Delhi.
Airbus is in talks with Mahindra Group to jointly develop India’s first privately made helicopter. It has also offered to transfer the final assembly of its Panther choppers to India if it wins a new order  and to build 40 of its C295 transport planes locally.
In 2014, Prime Minister Narendra Modi’s government raised the foreign direct investment limit in the defence sector from 26% to 49%  as part of its efforts to build a local military hardware industry.