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What is the story about?
Global engine manufacturer Rolls-Royce is pivoting from selling products to becoming a full-scale strategic partner for India. Speaking to CNBC-TV18, Sashi Mukundan, Executive Vice President, Transformation India, Rolls-Royce, outlined an aggressive roadmap encompassing multi-billion-dollar investments, significant workforce expansion, and localised supply chain developments spanning defence, civil aviation and power systems.
The company aims to massively scale its localised procurement over the next five years. Mukundan stated, "Our aspiration is, you know, we want to get to upwards of a billion dollars of supply from India... probably in the next five years."
To achieve this, the company's supply chain strategy relies on three specific operational buckets: utilising existing suppliers who can be easily shifted into new programs, supporting and tweaking existing supply chain players to help them achieve the necessary capability, and actively cultivating and building completely new areas of supply.
Currently, the company leverages a joint venture with Hindustan Aeronautics Ltd called International Aerospace Manufacturing Private Ltd, which manufactures over 200 precision parts for global operations. Having recently expanded its second factory in Hosur alongside its first facility in Bangalore, Mukundan noted that Rolls-Royce is already thinking about plants three, four, and five within the same area to support its strategic vision.
Central to Rolls-Royce's immediate defence strategy is its proposal for India's Advanced Medium Combat Aircraft program. Rather than offering a standalone engine, the company has proposed building a comprehensive domestic ecosystem with the unwavering support of the UK government.
Mukundan explained, "What we're thinking is we want to set up a whole what we call an aero gas turbine complex in India. What that means is basically we'll have a design centre, we'll have a development centre, we'll have a manufacturing centre, and then we'll have an aftercare, so the whole series will be in one complex, plus we will add to it the supply chain ecosystem..."
This initiative will feature a full transfer of technology and the localised development of intellectual property, executed jointly with the Gas Turbine Research Establishment and an Indian partner, with the goal of being ready with the engine to fly by 2034. If the proposal does not get the green light, the company will pivot to alternate programs to build Indian capability, noting that these technologies are intended to be dual-use for both military and civilian applications.
Beyond the aircraft program, Rolls-Royce is pitching localised propulsion solutions across all three arms of the Indian armed forces. This includes proposals to indigenize engines for marine applications, convert aircraft engine components into unique naval electric propulsion systems, and indigenize engines for the Arjun tank as well as all future combat vehicles.
On the power generation side, Force MTU, its joint venture with Force Motors in Pune, has already manufactured and exported 2,500 generator sets. These units feature 70% to 80% indigenous manufacturing using a supply chain ecosystem within a 200-mile radius of Pune.
Also Read: Vascon Engineers secures ₹347 crore order for RBI quarters redevelopment in Guwahati
The ultimate ambition is for India to join the United States, the United Kingdom, and Germany as Rolls-Royce's fourth home market, meaning the company will execute the full breadth of its global capabilities inside India. This scale is driven by massive domestic demand across multiple sectors.
In civil aviation, big aeroplane manufacturers forecast over 3,000 aeroplanes entering India, which translates directly to 6,000 engines.
In power systems, data centre energy consumption is projected to climb from 13 terawatt hours in 2024 to approximately 57 terawatt hours by 2030. This is driving a critical need for backup energy solutions like the systems Rolls-Royce currently provides to Delhi's T3 airport terminal.
Furthermore, the company is exploring the possibility of bringing Small Modular Reactors to India in association with a local partner. This aligns with support for the Prime Minister's ambition of achieving 100 gigawatts of capacity by 2047, with the first five by 2033.
To support these multi-sector operations, Rolls-Royce intends to more than double its local footprint. The company currently has a workforce of about 4,000 people across its joint ventures and Global Capability Center, but aims to take that number to 10,000.
Mukundan noted, "We're talking about at least taking that number to 10,000 is what in our CEO, when he came and he spoke with the Prime Minister, he said, you know, my goal is, you know, if I do all the stuff, we could end up having 10,000 people in India."
Regarding the total financial commitment, Mukundan confirmed the scale will involve multiple billion dollars, though the exact amount remains tied directly to program approvals.
He stated, "In terms of investment, multiple billion dollars, but I can't give you an exact number, because why I don't want to say that is it's dependent on what programs come through and, and secondly, what is the ecosystem you're building?"
Over the next 12 to 18 months, the company's core priorities remain locked on accelerating the aircraft engine proposal, progressing marine and land defence projects, expanding the vendor supply chain, and scaling up its domestic engineering center utilising Indian talent.
Also Read: Cipla wants new-age medicines to contribute 10% of revenue in five years
The company aims to massively scale its localised procurement over the next five years. Mukundan stated, "Our aspiration is, you know, we want to get to upwards of a billion dollars of supply from India... probably in the next five years."
To achieve this, the company's supply chain strategy relies on three specific operational buckets: utilising existing suppliers who can be easily shifted into new programs, supporting and tweaking existing supply chain players to help them achieve the necessary capability, and actively cultivating and building completely new areas of supply.
Currently, the company leverages a joint venture with Hindustan Aeronautics Ltd called International Aerospace Manufacturing Private Ltd, which manufactures over 200 precision parts for global operations. Having recently expanded its second factory in Hosur alongside its first facility in Bangalore, Mukundan noted that Rolls-Royce is already thinking about plants three, four, and five within the same area to support its strategic vision.
Central to Rolls-Royce's immediate defence strategy is its proposal for India's Advanced Medium Combat Aircraft program. Rather than offering a standalone engine, the company has proposed building a comprehensive domestic ecosystem with the unwavering support of the UK government.
Mukundan explained, "What we're thinking is we want to set up a whole what we call an aero gas turbine complex in India. What that means is basically we'll have a design centre, we'll have a development centre, we'll have a manufacturing centre, and then we'll have an aftercare, so the whole series will be in one complex, plus we will add to it the supply chain ecosystem..."
This initiative will feature a full transfer of technology and the localised development of intellectual property, executed jointly with the Gas Turbine Research Establishment and an Indian partner, with the goal of being ready with the engine to fly by 2034. If the proposal does not get the green light, the company will pivot to alternate programs to build Indian capability, noting that these technologies are intended to be dual-use for both military and civilian applications.
Beyond the aircraft program, Rolls-Royce is pitching localised propulsion solutions across all three arms of the Indian armed forces. This includes proposals to indigenize engines for marine applications, convert aircraft engine components into unique naval electric propulsion systems, and indigenize engines for the Arjun tank as well as all future combat vehicles.
On the power generation side, Force MTU, its joint venture with Force Motors in Pune, has already manufactured and exported 2,500 generator sets. These units feature 70% to 80% indigenous manufacturing using a supply chain ecosystem within a 200-mile radius of Pune.
Also Read: Vascon Engineers secures ₹347 crore order for RBI quarters redevelopment in Guwahati
The ultimate ambition is for India to join the United States, the United Kingdom, and Germany as Rolls-Royce's fourth home market, meaning the company will execute the full breadth of its global capabilities inside India. This scale is driven by massive domestic demand across multiple sectors.
In civil aviation, big aeroplane manufacturers forecast over 3,000 aeroplanes entering India, which translates directly to 6,000 engines.
In power systems, data centre energy consumption is projected to climb from 13 terawatt hours in 2024 to approximately 57 terawatt hours by 2030. This is driving a critical need for backup energy solutions like the systems Rolls-Royce currently provides to Delhi's T3 airport terminal.
Furthermore, the company is exploring the possibility of bringing Small Modular Reactors to India in association with a local partner. This aligns with support for the Prime Minister's ambition of achieving 100 gigawatts of capacity by 2047, with the first five by 2033.
To support these multi-sector operations, Rolls-Royce intends to more than double its local footprint. The company currently has a workforce of about 4,000 people across its joint ventures and Global Capability Center, but aims to take that number to 10,000.
Mukundan noted, "We're talking about at least taking that number to 10,000 is what in our CEO, when he came and he spoke with the Prime Minister, he said, you know, my goal is, you know, if I do all the stuff, we could end up having 10,000 people in India."
Regarding the total financial commitment, Mukundan confirmed the scale will involve multiple billion dollars, though the exact amount remains tied directly to program approvals.
He stated, "In terms of investment, multiple billion dollars, but I can't give you an exact number, because why I don't want to say that is it's dependent on what programs come through and, and secondly, what is the ecosystem you're building?"
Over the next 12 to 18 months, the company's core priorities remain locked on accelerating the aircraft engine proposal, progressing marine and land defence projects, expanding the vendor supply chain, and scaling up its domestic engineering center utilising Indian talent.
Also Read: Cipla wants new-age medicines to contribute 10% of revenue in five years
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