RAS question
BEL and Safran signed a Joint Venture Cooperation Agreement in November 2025 to manufacture HAMMER munitions in India. What was the equity split of this JV?
Correct answer: (B) 50:50 (BEL:Safran).
BEL and Safran Electronics and Defence agreed to form the HAMMER munitions joint venture in India with a 50:50 equity split.
Explanation
Bharat Electronics Limited and Safran Electronics and Defence signed the Joint Venture Cooperation Agreement for producing HAMMER, or Highly Agile Modular Munition Extended Range, smart precision guided air-to-ground weapons in India. The PIB release states that the joint venture company would be incorporated in India as a private limited company with 50:50 shareholding, so BEL and Safran would hold equal equity. The same release explains why this was not just a marketing MoU: the JV was meant to localise manufacturing, supply and maintenance of HAMMER for Indian Air Force and Indian Navy requirements. It also records the indigenisation target, with local manufacture of key sub-assemblies, electronics and mechanical parts planned to rise progressively up to 60 percent.
Why the other options are wrong
- (A) A 70:30 split would give BEL a dominant equity stake, but the PIB release specifies equal 50:50 shareholding for the joint venture company.
- (C) A 60:40 split confuses equity with the indigenisation target; PIB mentions up to 60 percent indigenisation, not 60 percent BEL ownership.
- (D) A 49:51 split would make Safran the majority shareholder, whereas the agreement described by PIB keeps BEL and Safran at equal 50:50 shareholding.
Concept
This tests defence manufacturing under Make-in-India and Aatmanirbhar Bharat, especially how joint ventures combine foreign technology with domestic production. RAS often asks such equity-split and indigenisation details because they link industrial policy with strategic sectors.