BEL jumps 3% on securing Rs. 5,300cr defence contract
What's the story
The Defence Ministry on December 15 inked a significant contract worth over Rs. 5,300 crore with state-owned Bharat Electronics Ltd (BEL) for the acquisition of electronic fuzes for the Indian Army. In response to the news, the shares of BEL have surged by over 3% to Rs. 169.05. These fuzes are essential components of medium to heavy caliber artillery guns, ensuring continuous firepower in military operations.
Details
Aiming for self-sufficiency and minimizing imports
This project primarily aims to bolster ammunition stocks, reduce imports, and achieve self-sufficiency in ammunition production. The Ministry of Defence stated, "As part of the 'Aatmanirbhar Bharat' vision, this contract has been signed for ammunition procurement under 'manufacture of ammunition for Indian Army by Indian industry', a government initiative for long term requirement of 10 years." The project also seeks to acquire critical technologies and secure stock affected by supply chain disruptions.
What Next?
Manufacturing at BEL's Pune and upcoming Nagpur plant
BEL will produce the electronic fuzes at its facility in Pune and the upcoming Nagpur plant. The Ministry of Defence noted, "The project will generate employment for one-and-half lakh man-days and encourage active participation of Indian industries including MSMEs in ammunition manufacturing and broaden ammunition manufacturing ecosystem in the country." This effort is expected to enhance India's domestic ammunition manufacturing capabilities.