Reliance Infra enters strategic pact with Germany's Diehl for guided munition system

Anil Ambani's Reliance Defence Ltd on Tuesday announced a strategic cooperation agreement with German arms manufacturer Diehl Defence for the production of next-generation terminally guided munitions (artillery shells).

"The partnership will drive local production of state-of-the-art, Vulcano 155 mm Precision Guided Munition system, catering to the Indian Armed Forces," it said in a statement.

The 155mm TGMs, which are equipped with built-in ECCM capabilities that make them less susceptible to enemy electronic jamming attempts, can home into targets within 10 seconds of reaching the anticipated impact zone.

"This milestone partnership represents a significant step forward for India's private sector in defence manufacturing, and aligns strongly with the nation's vision of achieving self-reliance in defence technology," the statement said. "The advanced munition system will incorporate state-of-the-art, laser and GPS-guided targeting technology, enhancing precision striking capability, while ensuring high-impact accuracy for designated targets."

Reliance Defence said it has the market opportunity to potentially generate ₹10,000 crore in revenue through the development and supply of advanced ammunition systems.

"The opportunity reflects not only organic growth potential but also the company's ability to localize critical defence technologies, enhance value capture across the supply chain, and establish itself as a key private-sector partner in India's defence modernisation roadmap," it said.

A separate joint statement by the two groups said Reliance group founder Anil D Ambani and Diehl Defence CEO Helmut Rauch discussed strengthening the strategic partnership on guided munition/terminally guided munition that they had entered into in 2019.

"For Diehl Defence, the collaboration with Reliance Defence is part of the company's commitment to the Indian market and to the 'Make in India' initiative of the Indian Government," it statement said.

The main purpose of the current strategic cooperation agreement between the two groups is to focus on the urgent supply of the 'System Vulcano 155mm Precision Guided Munition' for the Indian armed forces.

In parallel, the initiative 'System Vulcano 155mm under Make in India-II' is in progress with Reliance Defence as the prime contractor for the Indian customer and Diehl Defence as the strategic partner.

Reliance Defence said it aims to rank among India's top three private defence exporters.

"As the prime contractor to the Indian Armed Forces, it will lead the execution of this high-impact programme, with Diehl Defence providing critical technology and system-level expertise. The manufacturing initiative includes over 50% indigenous value addition and is aligned with the Government of India's Make in India, and Atmanirbhar Bharat initiatives," it said.

This marks Reliance Group's fourth strategic global partnership, expanding upon its established collaborations with Dassault Aviation, Thales Group of France, and Rheinmetall. This alliance strengthens Reliance Defence's role as a strategic partner in advancing India's indigenous advance manufacturing.

Helmut Rauch, CEO of Diehl Defence, said, "Diehl Defence looks forward to strengthening the current relationship with Reliance Group in the context of TGM for the Indian Armed Forces."

Ambani said: "This strategic alliance not only accelerates the advancement of India's defence manufacturing capabilities but also positions Reliance Defence as a pivotal player in the global defence supply chain."

The collaboration, he said, exemplifies resolve to catalyse sustainable growth, foster technological sovereignty, and position India as a formidable leader in the international defence arena.

As part of the agreement, Reliance Defence will establish a high-tech, greenfield manufacturing facility in Watad Industrial Area, Ratnagiri, Maharashtra. The manufacturing facility will contribute significantly to meeting the operational needs of the Indian armed forces while supporting the country's ambitious defence export target of ₹50,000 crore by 2029.

The facility will eventually have an annual capacity to produce up to 200,000 artillery shells, 10,000 tonnes of explosives, and 2,000 tonnes of propellant, the statement added.