The Latin America defence market is sizable, offering numerous opportunities for companies in the sector. It is a region with diverse defence needs, and several countries in Latin America have shown a growing interest in enhancing their defence capabilities.
Multifaceted Challenges
The challenges the companies encounter in entering and operating in this market are multifaceted. Distance and logistics pose significant challenges, especially considering the vast geographical spread of the region. To address this, companies like MKU Ltd., made a concerted effort to engage with clients and stakeholders through frequent visits, establishing local presence through Channel Partners, and participating in major defence exhibitions and events.
In an exclusive interaction with Financial Express Online, Neeraj Gupta, Managing Director, MKU & Chairman, SIDM – International Committee, says, “Language barriers were another obstacle, as many Latin American countries primarily use Spanish and Portuguese. To overcome this, we invested time and resources into learning Spanish, ensuring effective communication with our clients and partners.”
Responding to tenders in different countries demanded adaptability, as each nation has its own unique procurement processes and requirements. “We invested heavily in understanding the specific needs of each country and tailored our offerings accordingly.
The support of the Indian government, especially through Indian Diplomatic Missions, played a crucial role in facilitating our entry and operations in the Latin America market. These diplomatic missions provided valuable assistance by apprising the local authorities about our efforts to develop business in the region, enhancing our visibility and credibility. Additionally, the Indian government’s active promotion of Indian manufacturers and defence products, as well as sharing information on opportunities and requirements, proved beneficial in gaining a competitive edge, ” Gupta tells Financial Express Online ahead of the India-LAC Conclave.
Following are excerpts:
Is it correct to say you are the first private sector defence company in the region? How did you think of going there?
While it may not be entirely accurate to claim that MKU was the very first private sector defence company in the Latin America region, we were indeed among the pioneering Indian companies to explore and establish a presence in this dynamic market!
The decision to venture into Latin America came about during a visit to Rio de Janeiro, Brazil, in 2004. We realised the challenges of the brave heroes in the region and just knew we had to empower them.
MKU has always been customer-centric, and our focus is on providing solutions that address the real-time challenges faced by soldiers and security forces. Understanding and listening to the challenges of the end-users is at the core of our approach to product development and innovation.
This first visit was followed by several other visits to Brazil, Argentina and other Latin American countries.
During our visits to Latin American countries, we actively engaged with the armed forces and law enforcement personnel to comprehend their specific operational needs and requirements. This hands-on approach allowed us to tailor our ballistic protection solutions to suit their unique challenges, ensuring that our products effectively safeguarded those risking their lives for the security of their nations.
Earlier, in 2001 we had already set up a manufacturing facility to make Light Weight Composite Hard Armour Plates in India – one of the first companies outside the US and Europe to have this capability! Sensing an opportunity, in 2006 we gave our samples (HAPs) for qualification on NCNC basis to a local manufacturer of bullet proof jackets, who had won a tender from the Brazilian Army but did not have the capability to manufacture Hard Armour Plates. The samples met their requirements and we got the first order from the region – and after that there was no looking back. Since then we have made inroads in many of the countries in the region – Mexico, Brazil, Chile, Ecuador, Argentina, Columbia, Paraguay, Peru, Uruguay to name a few. Apart from ballistic protection equipment we have also successfully penetrated the market for Electro Optic Devices with the first order from the Brazilian Army.
What exactly are you selling to those countries? And who are your competitors?
In the Latin America market, we primarily focus on selling ballistic protection equipment, including state-of-the-art Bullet Proof Jackets and Helmets, advanced Hard Armour Plates and Electro optic devices. These products are designed to offer maximum protection to military and law enforcement personnel operating in challenging and high-risk environments.
Over the years we have successfully supplied Ballistic Plates and aircraft armour to Mexico, Bullet Proof Vests, Helmets and Electro optic devices to Brazil, Helmets to Peru to name a few. We have successfully empowered the entire police force of Ecuador. Chile, Uruguay, Argentina are also similar success stories.
There are no competitors when it comes to empowering heroes I feel. We have some industry peers who are extremely capable and support the forces brilliantly. Our differentiation has always been our commitment to ‘listening’ to soldiers and policemen, simulating real time challenges for our heroes!
Are you planning to set up any warehouse/manufacturing base in the region?
We already have an office set up in Brazil to better service our customers, and may look at expanding at a later stage. The team is continually assessing these strategic opportunities for expansion. Our current focus is on leveraging our existing capabilities and network to efficiently serve our clients in the region. However, as the market demands and business dynamics evolve, I believe we will remain open to future possibilities for localized production or warehousing to better serve our clientele.
You are Chairman, Society of Indian Defence Manufacturers (SIDM) – International Committee. Has a delegation been there in recent times, and what has been the response?
As a proud member of the Society of Indian Defence Manufacturers (SIDM) and Chairman of its International and Export Committee, I am happy to mention that the industry chamber actively participates in various industry events, forums, and interactions. Industry chambers like SIDM and CII play a vital role in advocating the interests of the Indian defence sector and promoting collaborations in the Latin America region.
Yes, it is true that till recently the major focus was on the US, Europe and the surrounding regions. But, with the government’s initiatives, the LAC region has also become an area of focus. The LAC region which has been historically dependent on the US and Europe for their major defence requirements is now trying to move away from these sources. This is an opportune time for the Indian defence sector to take advantage of this shift and establish itself as a dependable source of their requirements.
The efforts of these industry chambers have been instrumental in facilitating partnerships, promoting India-LAC defence ties, and fostering a conducive environment for businesses in the defence and security sector. Their initiatives have positively influenced the perception of Indian defence manufacturers, creating opportunities for productive engagements and mutually beneficial collaborations.
Any interesting anecdotes you would like to share?
Throughout MKU’s journey of establishing itself in the Latin America market, we have encountered several interesting and challenging experiences.
One notable anecdote revolves around our participation in the Latin America Aerospace and Defence Expo (LAAD) at Rio de Janeiro in April 2007. This pivotal event opened doors to make our first contacts across several prominent countries in the South American continent.
Our foray into Mexico comes to mind where we empowered the Federal Police with Ballistic plates and aircraft armour to help them successfully tackle the menace of the drug lords. The aircraft we armoured came under heavy fire during the operations but all occupants were saved!
Our foray into the Chile and Peru market paved the way for the introduction of Light weight ballistic helmets in the countries. We successfully empowered the entire police force of Ecuador, an exercise which was considered important enough for the Minister of interior of the country to especially travel to our facility in Kanpur for the signing of the contract.
We are currently engaging with Chile and Uruguay among others to meet their requirements. I am happy and satisfied that in all our engagements in the LAC region, we have met with the satisfaction of the end users which has ensured that we continue to service the region.
Overcoming the initial unfamiliarity and scepticism, we persisted in building relationships and showcasing the value and effectiveness of our products. As we began securing tenders and contracts, confidence in MKU’s capabilities and commitment to customer satisfaction grew significantly. Through consistent efforts, investment in product development, and building strong bonds with our clients and partners, we gradually transformed MKU into a well-known and trusted brand in the Latin America defence market.