Sunday, November 23, 2014

On Sunday, November 23, 2014 by Luke iMan in , ,    No comments
SDI expects the Asia-Pacific region to develop into the fastest growing missiles and missile defence systems market globally, growing at a CAGR of 6.1% in the next decade. However, the US will remain the largest market by volume, occupying 32.7% of the global market share over the next 10 years.

Bharathi Bajaj, analyst at SDI, said: “The early recovery of the Asian markets from the recent global economic crisis has led the missile manufacturers shifting their focus to emerging economies. China, India and South Korea are among the leading spenders procuring a huge arsenal of missiles including ICBMs, air defence systems, surface-to-surface missiles, SAM’s and cruise missiles.”

According to the report, the global missiles and missile defence systems market is set to grow at a projected CAGR of 4.9 % over the next ten years. With regional rivalries, ongoing arms race, conflicting territorial claims and persistent nuclear weapons threat from North Korea and Iran, worldwide economies will experience greater demand for the missile defence systems.

Bajaj adds: “Economies all over the world are investing billions of dollars in technological developments associated with missile defence as it has become an inevitable element of the modern day warfare.”
SDI data shows that innovations are focused on multi-layered BMD system, hypersonic missiles, smokeless missiles and laser technology capable of blinding in-flight heat-seeking missiles, among others.

Although missiles procurements worldwide will be large in terms of volume in the next decade, the industry will be distressed with a lack of transparency and cost overruns. For instance, the Medium Extended Air Defense System (MEADS) tri-national programme run by the US, Germany and Italy, has been plagued with cost overruns of US$2 billion.

Due to this downturn, the industry is focusing on establishing strategic partnerships, co-development projects and technology transfer agreements to control cost. Bajaj says: “Such initiatives not only boost the indigenous manufacturing capabilities of the host country but also provide foreign OEMs opportunities to explore new markets.” For instance, India which is aiming to attain self reliance in the missile defence sector by 2020 is engaged in a joint venture with Israel’s IAI for developing the next-generation anti-missile defence systems (previously known as Barak-8).
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