India’s premier defence public sector undertaking, Hindustan Aeronautics Limited, will have a new Chairman and Managing Director in May 2026. The selection process has already begun through an open advertisement. As someone who headed HAL’s Corporate Communications Department, I will not be surprised if yet another internal candidate ultimately secures the post. Traditionally, the Public Enterprises Selection Board gives preference to candidates with experience in defence, aeronautics, or aviation, and within that pool, HAL insiders almost always enjoy an edge. This pattern is not unique to HAL, it extends across many public sector undertakings.
However, this approach, with a few exceptions, has not served PSUs well. HAL is no different. Today, the company proudly holds Maharatna status and operates 21 manufacturing divisions and nine R&D centres across multiple states. Globally, it features among the most closely watched defence companies. HAL’s responsibilities are vast, and that includes delivering platforms such as the LCA Mk-1A, LCH, and LUH helicopters, and ensuring production stability despite supply-chain vulnerabilities. The stakes are high, especially as India pushes for strategic autonomy and faster indigenisation.
Given HAL’s size, pace of expansion, and the critical expectations from the armed forces, the long-standing habit of limiting the CMD’s post to insiders needs urgent reconsideration.
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A deep-rooted resistance to outsiders
HAL has historically resisted the idea of an outsider at the helm. Although the company does not directly choose its CMD or directors, it ensures that a good number of internal candidates remain eligible, often aided by systemic biases. For example, the director-level posts, even non-technical ones such as HR and finance, almost always go to insiders.
In its 80-year history, HAL has seen only one major exception. In 2012, the chairman’s post — it was not titled CMD then — went to someone from outside the aerospace and defence ecosystem. This happened not by design but by default, as internal candidates failed to meet the basic eligibility criteria, particularly the residual service requirement: two years for internal candidates before turning 60, and three years for external candidates. Why such disparities exist is known only to policymakers.
When the outsider, a professional with experience in ONGC and Pawan Hans, took charge, a section of the organisation was visibly uncomfortable. Many believed that experience at an oil company or a helicopter service provider did not equate to managing an aircraft manufacturing enterprise. As someone who has worked in four PSUs, I can say such sentiments are widespread. Every PSU tends to believe its challenges are incomparable.
Yet the outsider, an engineer from IIT, proved effective. He brought in a more professional, dignified culture to an organisation long accustomed to abrasive, hierarchical practices. He initiated quarterly Key Executive Meets, where issues from the shop floor to HR were discussed threadbare. Some of his initiatives, particularly leadership development programmes involving international exposure and IIM Ahmedabad courses, were criticised as extravagant but were later continued by subsequent leadership.
Unfortunately, though still in vogue, the programme has not succeeded in producing the best for the top positions. HAL has its own Management Academy, with a sprawling campus and enviable infrastructure in Bengaluru, but it has failed to chalk out effective leadership programmes.
The four successive CMDs — the new title introduced in 2014 — including the current one, have all come from within HAL. All of them were good in their own ways. One, who came from a finance background and was not liked by many within simply because he was not an engineer, did well as officiating CMD until his tenure ended in 2024. Although he was an internal candidate and had applied for the post, he was not shortlisted; the PESB interviewed the remaining HAL candidates and found them unsuitable. His success, whatever the reasons, struck down the notion that only professionals from the technical arena should be CMD. He might have been lucky to hold the post until his superannuation, as the government had begun looking for Make-in-India products with strong support to HAL in many ways.
The current CMD — again an internal candidate selected by the government’s Search Committee, with his predecessor having a strong say as a member — also seems to be sitting pretty due to timely policy support and significant defence orders.
Yet HAL continues to face criticism over delivery timelines and quality issues, and here lies the challenge.
Policy tweaking and the ‘insider pipeline’
As the 2026 selection approached, there was a real possibility that only one senior internal candidate, the Director (Operations), would meet eligibility norms, increasing the likelihood of an outsider being chosen.
Recalling the 2012 situation, the HR department moved quickly. The promotion policy in general, and the residual service rules which have kept changing over the last five years depending on who needed to be favoured, were tweaked again in recent months. Several general managers have now been promoted as executive directors with unusual speed, widening the internal pipeline.
HAL’s intention in this change in particular seemed to be ‘the more the merrier’, as long as it prevented an external candidate from emerging as a serious competitor.
This raises a simple but critical question: should the leadership of a national defence enterprise be shaped by internal lobbying and shifting HR rules?
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Why HAL needs the best, not just an insider
HAL is India’s most critical aerospace company, covering design, production, MRO, engines, avionics, trainers, fighters, helicopters, and more. Nearly 60 per cent of the Indian Armed Forces’ aviation assets are HAL-built or HAL-supported, including many platforms HAL did not originally manufacture.
The organisation is at a turning point. New programmes like Tejas Mk-1A, Tejas Mk-2, IMRH, HTT-40, and AMCA will demand disciplined execution, rapid innovation, and global-quality supply chains. Delays will attract intense scrutiny, as they already do.
In such a context, restricting the CMD’s post to insiders alone makes little sense. Outsiders bring fresh thinking, break entrenched groupism, and strengthen professionalism. Insiders bring valuable experience, but often carry legacy loyalties and contribute to factionalism. During my tenure, I witnessed how groupism corroded the culture of meritocracy more in HAL than in other PSUs I served. An outsider, with limited time and no internal baggage, is often more likely to focus on performance. Of course, the candidate needs to be thoroughly evaluated on many other qualities including education, experience, and leadership before any decision is made in his or her favour.
A call for merit-based selection
HAL is too important to be governed by tradition or internal lobbying. Its future leadership must be chosen with a national perspective.
The best candidate should lead the organisation, and therefore the Ministry of Defence, PESB, and the Government of India must ensure that the ‘insider advantage’ does not automatically override merit. HAL belongs to the entire nation, not merely to HALites.
Gopal Sutar is ex-spokesperson HAL and media analyst, SABC/ARAMCO. Views are personal.
(Edited by Asavari Singh)