Mr Amit Cowshish is a former Financial Advisor (Acquisition), Ministry of Defence and former Distinguished Fellow, Manohar Parrikar Institute for Defence Studies and Analyses, New Delhi. Click here for Detailed Profile
There seems to be no clear advantage of giving an overarching role to the Ministry of Home Affairs as regards formulation of policy or grant of industrial licence for manufacture or export of defence items.
The objective of promoting Indian industry can be achieved in a simpler manner if after selecting the platform to be inducted MoD leaves it to the foreign OEM to tie up with the Indian company of its choice.
It would be both graceful and fair to pay a reasonable amount that is seen as equitable compensation for infringement of the fundamental right to life or damages arising from tortious liability of the government.
While there is no doubt that India could do with help from Japanese defence firms, the modality of acquiring technologies from foreign companies in general requires to be clearly articulated.
Speaking at the United Service Institution on May 4, 2017, the Chief of the Army Staff said that India needs to spend much more on military modernisation to ensure that economic growth continues unhindered.
The government should set up a task force to engage with potential investors and investees and evolve a simplified FDI policy, which has different slabs for different kinds of activities and is free from terms and conditions that are difficult to understand and implement.
It is important to restore the functional self-sufficiency of the finance division of a ministry which handles 17-18 per cent of the total central government expenditure so that it could discharge its responsibilities without real or perceived pressures.
The basic challenge for defence economists is to demonstrate that there are other feasible ways of skinning the cat during budget formulation. But the challenge is also inextricably linked with the need for rationalisation of defence expenditure.
There is a strong case for abandoning the present approach of looking at the defence budget through the narrow prism of allocation and utilisation, and instead focus on outcomes.
The objective of asking these question should be to elicit information that generates a well-informed debate on, and facilitates the result-oriented monitoring of, the MoD’s handling of matters related to the defence budget.
Fog clears over industrial licensing for defence industry but questions remain
There seems to be no clear advantage of giving an overarching role to the Ministry of Home Affairs as regards formulation of policy or grant of industrial licence for manufacture or export of defence items.