Business EconomyPosted at: Aug 13 2025 8:31PM


SMPP–ADFC JV in Philippines to get direct defence contracts

Bengaluru, Aug 13 (UNI) The strategic defence partnership between India and the Philippines has received a major boost with a key provision ensuring the newly proposed SMPP–ADFC joint venture corporation (JVC) in the Philippines would have direct access to long-term national defence contracts without public bidding.
Under Sections 15 and 16 of the Philippines’ Republic Act No. 12009, the Department of National Defence (DND) can directly award contracts to local enterprises like the planned JVC, bypassing the usual public bidding and technical prequalification processes. This legislative advantage positions the JVC as a long-term, in-country supplier for the Armed Forces of the Philippines, ensuring both strategic reliability and economic benefits for the host nation.
The JVC, to be headquartered in the Philippines, will be formed under a landmark Memorandum of Understanding signed between India’s SMPP Limited, a leading defence technology firm, and Asia Defence and Firepower Corporation (ADFC) of the Philippines during President Ferdinand Marcos Jr’s first state visit to India.
The venture is designed to support the Philippine government’s Self-Reliant Defence Posture (SRDP) initiative under Republic Act No. 12024 by manufacturing, assembling, and distributing a range of advanced defence products developed by SMPP.
“This joint venture represents the best of Indian defence innovation meeting the needs of a friendly partner nation. It is a proud moment for us as we take our homegrown technologies and capabilities overseas, in the true spirit of Atmanirbhar Bharat,” said Ashish Kansal, CEO, SMPP Limited.
In compliance with local laws, the JVC will be majority-owned (at least 60%) by Filipino stakeholders, making it eligible for significant benefits under the Philippines’ CREATE Act, including tax holidays, duty-free import of capital equipment, and streamlined regulatory approvals.
SMPP will provide its indigenously developed and battle-tested technologies, alongside its proven manufacturing and quality assurance systems that have protected the lives of Indian armed forces personnel for over a decade.
ADFC will manage local operations, talent development, and recruitment, ensuring that the manufacturing and R&D capacities are Filipino-led in the near future. Governance will be overseen by a majority Filipino board to ensure alignment with national priorities.
“This collaboration will not only give the Armed Forces of the Philippines access to advanced defence technologies but will also generate employment, enhance local skills, and strengthen indigenous industrial capacity,” said Jeruel D. Sanchez, President and CEO of ADFC.
The signing took place amid multiple agreements between India and the Philippines covering defence, healthcare, education, renewable energy, and other sectors, underscoring New Delhi’s growing role as a strategic partner in Southeast Asia.
By enabling direct defence contracting, encouraging indigenous capacity building, and exporting proven Indian technology, the SMPP–ADFC venture signals India’s emergence as a trusted global defence partner and reinforces its vision of “Make in India, Make for the World.” UNI BDN SSP
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