Sargad and Government of Telangana sign MOU to invest $100 Million USD in aerospace & defense manufacturing ecosystem

At the World Economic Forum today, Sargad LLC and the Government of Telangana signed a Memorandum of Understanding to establish AeroNxt, a collaborative initiative to modernize India's aerospace and defense manufacturing ecosystem. The MOU was signed at the India Pavilion during the WEF Annual Meeting 2026, with Sargad targeting deployment of up to $100 million USD in the state's aerospace & defense sector over the next several years.

The initiative addresses a critical supply chain gap as global air travel continues to expand and demand for new aircraft and their sustainment accelerates. Original Equipment Manufacturers are seeking reliable, cost-competitive manufacturing partners to meet this growing demand while managing supply chain uncertainty.

The initiative is supported by a group of senior global executives, bringing decades of leadership experience and relationships across global aerospace and defense programs. The initiative targets four strategic objectives: investing in and modernizing MSMEs; developing capabilities to deliver high precision components, sub-systems, and structures for next-generation aircraft and defense programs; facilitating access to global OEM's and Tiered supply base; and establishing an MRO Center of Excellence for aerospace components.

"Global aerospace supply chains are shifting toward trusted, cost-competitive suppliers with quality manufacturing and design capabilities, with the ability to supply reliably at scale. India has the engineering talent and the strategic positioning. This partnership with the Government of Telangana is about selectively investing in MSMEs, building capabilities in high-precision mechanical and electronics components and software, and supporting the needs of aircraft manufacturers and Tier 1 suppliers globally," said Sri Thota, Founder & CEO of Sargad LLC.

Sargad is an operator-led industrial and investment platform with experience across aerospace, defense, automotive, clean energy, and data center manufacturing sectors, focused on IP-driven industrial businesses. The initiative is expected to be pursued through Sargad's Industrial Investment Platform.

The initiative capitalizes on Telangana's industrial ecosystem, anchored by HAL, DRDO, BDL, Tata ASL, and Cyient, combined with a strong engineering talent pool and progressive government policies. The existing MSME base is strategically positioned for modernization into globally competitive aerospace suppliers.

The partnership aims to support incremental export growth, job creation, skill development, and MSME modernization over a multi-year period. The initiative seeks to contribute to Atmanirbhar Bharat objectives and build private sector participation in aerospace and defense capabilities.