New Delhi, Nov 6 (KNN) Sweden's Saab has become the first foreign company to bag 100 per cent FDI in India's defence projects and will set up a new facility in the country to manufacture shoulder-fired rockets, reported ET.

Sources told the newspaper that Saab's proposal, valued at under Rs 500 crore, was cleared in October.

At present, India allows only 74 per cent FDI in the defence sector under the automatic route. Beyond that, clearance can be obtained on a case-by-case basis. However, the clearance rules were relaxed in 2015, still, no foreign firm was able to get permission for 100 per cent FDI in defence.

Saab has set up a new company – Saab FFV India – to make the latest generation of the Cal-Gustaf M4 system. This will be the first time Saab will manufacture shoulder-fired rockets outside Sweden.

The manufacturing facility is likely to be placed in Haryana. The shoulder-fired rockets are already in extensive use by the Indian armed forces. According to the report, they can be even exported once local production begins.

(KNN Bureau)