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India is emerging as the back-office and investment hub for global aviation majors, with aerospace majors EADS and Boeing committing investments to the tune of Rs 20,000 crore (Rs 200 billion).
According to aviation analysts, these investments are some of the largest made by the two companies outside the US and Europe.
The investment commitment from the two companies comes at a time when the government is in the process of finalising orders for 126 multi-purpose fighters and maritime patrol aircraft and helicopters for the defence.
Both Boeing and its European rival EADS are pitching for the order, which is one of the largest ever defence purchase order from India.
In addition, in 2005-06, various Indian carriers have placed orders for over 100 airplanes from Boeing. Its rival Airbus received orders for about 300 aircraft from Indian carriers.
Boeing, which at present works with companies like Wipro, Infosys, TCS and HCL Technologies, is looking at increasing the amount of work given out to these technology companies.
The US-based aerospace company is also looking at expanding its scope of operations in the country. The company, which largely sells commercial airplanes in India, is also drawing up plans to tap the defence market.
EADS's Rs 11,000 crore (Rs 110 billion) investment will largely go into setting up an engineering and research centre in India, while for Boeing the investment will be in the form of direct investment in facilities, research and development, sourcing of software and other equipment.
In addition, both the companies are looking at airplane maintenance facilities in India. Boeing has gone ahead with a Rs 185-crore (Rs 1.85 billion) announcement to set up a maintenance facility in Nagpur. Airbus is also expected to come out with a similar facility in the country soon.
A significant part of EADS's investment will be for opening the the EADS Technology Centre India, which will undertake work for all EADS companies, including Airbus, Eurocopter and the defence divisions.
It will also have Indian partners working on engineering and information technology services. The EADS Technology Centre India will create up to 2,000 jobs.