Adani Group a key player in Indo-Israel defence cooperation: Tel Aviv daily

 By Rajiv Shah
Said to be one of the most influential Israeli dailies, "Haaretz" (literally: News of the Land) has identified the Adani Group—known to be close to Prime Minister Narendra Modi—as one of the key Indian business houses engaged in defence cooperation with Israel. Pointing out that India supplied the Israeli military with Hermes 900 drones, the daily reported that this advanced aerial vehicle came off “the production line in a factory set up in Hyderabad, as part of the cooperation between the Israeli Elbit and India's Adani Group.”

The cooperation with Elbit, an Israel-based international military technology company and defense contractor, was, according to the daily, part of the sharp rise in “warmer” diplomatic relations between the two countries following Prime Minister Narendra Modi’s election to office in 2014, as part of the “Make in India” initiative, which called for more local production lines and companies.
The daily quotes an Israeli businessman as stating, “You can't tell where Indian industry ends and Israeli industry begins... Every company that manufactures physical parts, regardless of composite materials, metal or plastic—they all have ties of one type or another with Israeli companies.”
It adds, “The Russian invasion of Ukraine in 2022 brought about even tighter cooperation. Israeli companies benefited from the Indian military's continuing use of Russian technology, while the Russians were suddenly unable to provide support services,” as the Russians “turned all at once from arms exporter to arms importer.”
The daily, which was founded in 1918 and is said to have a “broadly liberal outlook both on domestic issues and on international affairs,” going so far as to oppose retaining Israeli control over the Palestinian territories and to support peace initiatives, in its report titled "Why the Future of Israeli Defense Lies in India", states that the expanding defence cooperation between Israel and India, with joint projects by leading companies in both markets, is helping Israel “to reduce its dependence on the West.”
As for India, the cooperation, the daily believes, “offers a much-needed toehold in the Middle East,” especially during the current Gaza war, “when the Israeli military has been operating in several theaters and required huge amounts of shells, bullets and bombs, as well as replacement parts for systems that were hit in battle or worn out by unceasing use.”
Authored by Oded Yaron, a specialist in arms industries and technology for Haaretz, the report says, “While the United States stepped up to help, the extremist government in Jerusalem meant that other friendly countries in the international arena kept their distance and limited defence exports.”
It is in this context that “India has become almost as important a crutch to Israel as the U.S., helping out with advanced drones, thousands of shells and countless crucial components,” it adds.
The report notes, “In May 2024, Spain denied a docking permit at the port of Cartagena to a ship, the Marianne Danica, which was flying the Danish flag. The reason: it was carrying explosives from the Indian port of Chennai to Israel.” Stating that the shipment was “the tip of the iceberg,” it underlines, “A review of records indicates dozens of such shipments from Indian defense companies to Israel since the start of the war.”
“These include thousands of 155mm shells from companies such as Kalyani Strategic Systems, light firearms and accessories from PLR Systems, and components for advanced technological systems from INDO-MIM. There is also no shortage of defense-related shipments in the opposite direction, from Israel to India,” the report reveals, quoting a senior Israeli businessman who has been living and working in India for many years, as stating that “the Israeli defence industry has become, if not a subsidiary of the Indian defense industry, at least its full partner.”
The report quotes the businessman as further stating, “If you look at it in perspective, you can identify three phases in the history of the Israeli defence industry. We started out dependent on the French, switched to the Americans, and now we are switching to the Indians. There is no other way to describe this.”
The daily says the defence cooperation, which first began in the 1990s, reached a “critical stage” in the 2000s, as India's adoption in 2005 of a policy requiring new defense contracts to include a minimum 30 percent offset clause—“meaning the arms exporters would also have to purchase military goods in India.” The businessman said, “At this point, all the world's defense industries became anxious, since there is nothing to buy in India.” But Israeli firms jumped at the opportunity, led by the three defence giants—Rafael, Elbit, and Israel Aerospace Industries. “They set up huge offset contract departments to look for and develop suppliers.”

India's offset deals since 2005

It says, “A survey posted on the Indian defense ministry website indicates that out of 56 offset deals since 2005, 23 (41 percent) are with Israeli companies—more than with the U.S. or all European countries. In retrospect, this decision evidently paid off for India. Smaller Indian companies, such as Rangsons Electronics (purchased in 2015 by Cyient) and INDO-MIM, which specializes in metal injection molding, grew within a few years by hundreds of percentage points, thanks to cooperation with foreign companies—mainly Israeli ones.”
Says the businessman, “You cannot tell where Indian industry ends and Israeli industry begins... Every company that manufactures physical parts, regardless of composite materials, metal or plastic—they all have ties of one type or another with Israeli companies.” All of this received a fillip following the warming of Indo-Israeli ties after Modi came to power in 2014.
Diplomatic relations between the two countries have grown even warmer under the current government.
The daily says, “In addition to the Elbit-Adani Hermes 900 joint venture, Elbit and Kalyani’s Bharat Forge have set up BF Elbit for cooperation in the field of artillery; the Kalyani Group has established KRAS, a joint venture with Rafael, specializing in integration and manufacture of components for Spike missiles, Barak 8 missiles in cooperation with IAI, and guidance kits. In 2023, Elta, a subsidiary of IAI, acquired the Indian firm HELA, which provides maintenance, repair, and overhaul product support for advanced radar systems.”
According to the report, “Israel’s help in servicing India’s Russian-made arms is one of the reasons India has sided with Israel over the last year and a half.” It quotes Lauren Dagan Amoss, a researcher of Indian foreign and security policy at the Begin-Sadat Center for Strategic Studies, as saying that one should not expect India to provide the same kind of patronage that Israel has enjoyed with the U.S., but Indian flexibility offers some significant advantages.
He states, “Here is an international player capable of talking to both Iran and Israel, to Russia and China as well as the U.S., to both the Middle East and Africa. This is a country that Israel could use to develop economic and diplomatic ties in the region. Today, India is far more reliable than many other countries...”