Defence Production

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  • Public Procurement Framework in India

    The GFR 2017 permit individual ministries to issue detailed instructions to address the needs and complexities of procurement carried out by them. The question is whether those principles and rules come in the way of the Ministry of Defence evolving a more efficient procurement procedure that meets the armed forces’ aspirations.

    August 19, 2021

    Self-Reliance in Defence Sector

    The Ministry of Defence has taken significant steps in recent times to boost domestic defence manufacturing and increase the role of the private sector to reduce dependence on imports and achieve self-reliance.

    August 04, 2021

    Indigenisation – In Need of Policy Framework

    There is a need to formulate a composite policy that focuses on indigenisation in high priority technology areas, shedding the notion that it must necessarily result in savings. A more modest and focussed mission-mode approach to indigenisation can produce better results.

    July 09, 2021

    P.V. Venkata Krishna asked: Does DAP 2020 guide the vendors on whether they can use China-based hardware or software or both in defence stores? If not, which policy should the vendors follow?

    Amit Cowshish replies: The Defence Acquisition Procedure (DAP) 2020 does not specifically prohibit the use of raw material, hardware, or software imported from any country. However, it does require the vendors to institute appropriate measures for information security and to ensure that the equipment being supplied is free from the possibility of subversion attacks, embedded spyware/ malware, and similar risks.

    Mohit Nayak asked: How can indigenisation in the Indian defence sector be enhanced?

    Amit Cowshish replies: As the first step, the Ministry of Defence (MoD) needs to formulate a composite policy that focuses on the indigenisation of high priority technology areas, shedding the notion that it must necessarily result in savings. The commercial viability of the identified projects and institutional arrangement for financing them, apart from a mechanism to accommodate the cost of failed efforts, must form the bedrock of the policy.

    Mohit Kumar Nayak asked: Why does India have a low indigenisation in the defence sector?

    Amit Cowshish replies: Broadly speaking, there are four reasons for the low level of indigenisation in defence products. The primary reason is the absence of a pragmatic overarching policy which, apart from defining the term ‘indigenisation’ which is presently interpreted in different ways, also recognises that indigenisation cannot always result in savings, especially in areas like development of special alloys and critical technologies which do not offer economy of scales.

    Chinmay Khadke asked: Is there any ToT involved in C295 transport aircraft to be built by Tata-Airbus in India? What can be its implications for the aviation manufacturing ecosystem? Any potential civilian transport use of aircraft?

    Kishore Kumar Khera replies: A contract for procurement of 62 C295 aircraft is under consideration for replacement of 56 HS748 Avro for the Indian Air Force (IAF) and the balance six aircraft for the Indian Coast Guard. Of these, 16 aircraft are to be built by the original equipment manufacturer (OEM) and the balance aircraft will be manufactured in India. To facilitate aircraft manufacturing in India, certain Transfer of technology (ToT) is inevitable.

    Increase in FDI Cap Alone Not Enough for Defence Sector

    Raising the FDI limit by itself may not enthuse the foreign investors as per the expectations. To make the defence sector more attractive for foreign investment, a whole lot of other related issues will have to be addressed by the government.

    September 14, 2020

    Impact of Embargo on Defence Imports

    It would be helpful if MoD issues a formal order addressing the concerns expressed by various stakeholders about certain aspects of the negative list, especially its impact on projects that involve foreign OEMs and the purpose of bifurcating the capital budget.

    August 14, 2020

    Atma Nirbhar through Arms Import Ban

    The negative list of embargoed defence items is one more step towards creating a strong domestic arms industry and making India self-reliant in defence production.

    August 13, 2020

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