Engineering and construction giant L&T entered into a joint venture with European defence major MBDA Missile Systems for development of missiles in India.
L&T will own 51 per cent stake in the JV named L&T MBDA Missile Systems and the rest 49 with the European partner.
Initially, the JV will look to develop and supply fifth generation anti-tank guided missiles (ATGM5s), missiles for coastal batteries and high speed target drones.
Going forward it will focus on opportunities in missile and missile systems domain, and target prospects under different categories of defence procurement which has specific requirements for design developed and manufactured in India, the company said.
Commenting on the partnership, L&T Group Executive Chairman AM Naik said the two companies have been working together for the last six years, specially on the defence offset programs in India.
"We feel the time has come to strengthen the partnership. We will be manufacturing on our shop floor what we design and develop," he told reporters here.
Naik said L&T is betting big on defence sector considering the government's focus on Make In India and its decision it to procure missile systems from abroad.
He said L&T is targeting an annual turnover of Rs 10,000 crore from its defence vertical by 2021. "We think we are on our way to achieve that. Very soon we will also start our guns programme," Naik said.
MBDA CEO Antoine Bouvier said the company has been in India for many years supplying to the Indian defence forces and the JV is a natural progression.
"It is also a common commitment to respond to the call of India government's Make in India and indigenisation of defence products," he added.
The JV expects to roll out the first product in the next two years. Although it hasn't finalised on where the missile systems will be manufactured, the company has shortlisted two out of L&T's nine facilities.
If needed, it is open to considering a new facility. MBDA is jointly owned by AIRBUS Group (37.5%), BAE Systems (37.5%) and Leonardo (25%).