Defence Economics & Industry: Publications

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  • Reviewing Defence Offset Guidelines: A Recap

    The Guidelines of 2012 have been under review for some time. While a drastic shift in the policy is unlikely, some changes in the policy, clarity about some of the existing provisions and simplification of the procedure seem necessary to make the policy work better.

    July 17, 2014

    Takeaways for Defence in the Union Budget 2014-15

    There are speculations whether the present budget is sufficient to meet expenditure on big ticket items but one has to bear in mind that it is only the advance payment – generally 15% of the contract value – that becomes payable on signing of a new contract. Even if new contracts are signed for say INR 50,000 crore, MoD will require just about INR 7,500 crore for those schemes.

    July 11, 2014

    Takeaways from Defence Minister’s address at Naval Commanders’ Conference

    The Defence Minister made two significant points: one, the need for making a significant amount of the nation’s resources available for defence and two, he talked about the slow pace of acquisition of defence equipment as the key concern. These are unexceptional statements of intent and the challenge would be to meet these objectives.

    July 01, 2014

    FDI in Defence - Revisiting the Conundrum

    The proposal to relax the present cap on FDI in defence has expectedly drawn sharp reactions. Those who oppose argue that higher FDI is not required and, more importantly, it will not be in national interest, not the least because it will stymie the process of indigenization. This calls for a dispassionate analysis.

    June 26, 2014

    Reforming Defence Contracting Procedures

    It may perhaps be useful to examine some features of India’s Defence Procurement Procedure (DPP) for streamlining of the capital acquisition process for defence procurement. After all, the DPP may well be the only procurement regulation in the world that discriminates against its own domestic bidders

    May 28, 2014

    Defence Reforms – Agenda for the New Government

    Defence Reforms – Agenda for the New Government

    A country’s response to external threats and internal security challenges is based on its defence preparedness, advance planning for contingencies and the political will. The new government will have to make key decisions on different aspects of defence reforms. This Policy Brief puts forward some suggestions.

    May 22, 2014

    Moving on with the Defence & Security of India

    Ministry of Defence which accounts for 13-14 per cent of the central government expenditure, if one also takes into account the expenditure on defence pensions, could come under some pressure to prepare an action plan as the outcome of what it does is often intangible, undisclosable, or simply unmeasurable. The author puts forward some suggestions.

    May 20, 2014

    Foreign Direct Investment Policy 2014: Status Quo for the Defence Sector

    One of the provisions in the policy is that in the Information & Broadcasting and the Defence sectors, where the sectoral cap is less than 49 per cent, the company would need to be ‘owned and controlled’ by resident Indian citizens and Indian companies, which, in turn, are owned and controlled by resident Indian citizens. This is a virtual impossibility.

    April 23, 2014

    Running Low on Ammunition

    If we have no qualms about importing from other countries why cannot we buy ammunition from our own private sector companies? While restrictions could apply to production of small arms and ammunition, for large calibre arms and ammunition there is a case for permitting the private sector companies to chip in.

    April 03, 2014

    Unshackling the Armed Forces: Need for Greater Delegation of Financial Powers

    The recommendations of a committee set up in 2009 to review the delegated powers were accepted by the Defence Minister in December 2010 but soon thereafter these were held in abeyance because of the perceived fear that there was a large scale misuse of the delegated powers and that implementation of committee’s recommendations would result in excessive delegation of powers.

    March 25, 2014

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