MUMBAI: The Anil Ambani-owned Reliance Group has selected Mihan near Nagpur in Maharashtra for developing India's first smart city for the defence sector. Known as Dhirubhai Ambani Aerospace Park (DAAP), the smart city will be developed at a cost of $1 billion to manufacture helicopters for both commercial and military applications.

The project would be the first integrated facility in aerospace structure, engine design and manufacture, fabrication and platform integration in the country.

The move is part of the Reliance Group's aggressive play in defence, seeking to capture a slice of the $100 billion worth of opportunities that the sector would soon throw up as part of the NDA government's 'Make in India' programme to focus on indigenous manufacturing of defence equipment.

Confirming the move, Reliance Group chairman Anil Ambani said, "The group plans to develop DAAP as a centre of excellence in the aerospace segment on the lines of the global centre of ship building at Pipavav in Gujarat." Earlier this year, the Reliance Group added heft in its defence manufacturing by buying out Nikhil Gandhi-promoted Pipavav Defence and Offshore Engineering (PDOE), which houses India's largest dry dock facility to build warships. It subsequently committed investments of Rs 5,000 crore towards indigenization efforts.

Company officials told TOI that Mihan was selected after negotiating with the governments of Maharashtra, UP, Madhya Pradesh and Rajasthan for land for the project.

DAAP may draw some influences from Aerospace Valley in France, a cluster of aerospace companies and research centres concentrated around Toulouse. About 500 companies - including Airbus, EADS, Air France Industries and Dassault Aviation - operate in the cluster, creating jobs for around 1.2 lakh people.

The aerospace park, comprising a cluster of manufacturers, will indigenously produce and deliver major aircraft components and spares and cater to the avionics requirements of the aerospace industry and will generate direct employment for over 2,000 people in the skilled category. Besides, it would also provide for 10,000 indirect jobs.

Reliance Defence & Aerospace (RDA), a Reliance Group company, has shown interest for the tenders of providing 387 Army reconnaissance and surveillance helicopters and 100 Naval utility helicopters, estimated to be valued at Rs 25,000 crore. It is also in talks with a few potential partners for a tie-up.

Sikorsky, Eurocopter and Kamov are some of the top helicopter manufacturers said to be in talks for a tie-up but Reliance officials refused to comment on potential technology partners, citing non-disclosure agreements signed with them.

DAAP will not only create indigenous capabilities but will also add to skill development in the core aviation industry as it is pursuing opportunities to meet home-grown solutions for the defence sector as the company plans to include fully integrated solutions starting from sub-assemblies to completed platforms with an ability for maintenance, repairs and overhaul (MRO) for the life cycle of platforms, said sources in the know, adding that the group is in discussion with various OEMs for supporting its growth strategy.

The Narendra Modi government has redesigned its military procurement programme under the 'Make in India' initiative and has also allowed a 49% FDI in defence to promote local manufacturing as well as to aid the much needed technology transfer. The buy and make (India) scheme, under which these tenders will be issued, requires an Indian company to bid after tying up with a technology provider. It seeks to establish the required defence industrial base in the country to gradually move away from being the world's largest importer of defence hardware.