Defence Public Sector Undertakings and Exports: An Assessment

This article examines issues related to exports by the nine major defence public sector undertakings (DPSUs) under the broad categories of ships, aircrafts and sensors. It then analyses three key aspects related to research and development (R&D) expenditure, marketing partnerships and lines of credit (LoCs). Aspects relating to DPSU R&D expenditure are highlighted given that R&D plays a vital role in niche product development, which aids not only domestic procurement by the armed forces but also enhances export opportunities. The DPSUs have sought to enhance their exports through outreach activities, marketing representatives and establishment of overseas offices. The LoCs have also significantly facilitated the DPSU exports to friendly foreign countries. The article highlights some of the challenges that the DPSUs have to overcome in order to expand their export profile, including those related to competitive export markets, defence indigenisation and reducing import dependence. With the government aiming for a defence exports target of Rs 50,000 crores by 2028–29, the ability of the DPSUs to contribute to the exports pie will, no doubt, continue to be in focus.

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