Defence Offsets

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  • A Critique of India’s Defence Offset Guidelines 2012

    A Critique of India’s Defence Offset Guidelines 2012

    Some of the provisions in the DOG do not seem to be well thought out, provide greater leeway to the foreign companies, and have a potentially negative potential on eligible manufacturing sector, particularly defence manufacturing.

    September 03, 2012

    The Rafale : An Opportunity Towards Indigenous Aircraft Design And Manufacture

    In the wake of the selection of the Rafale the offset clause currently in force must be used to revamp India’s domestic aerospace industry, making it more technologically current and capable of taking on advanced design and development tasks in future.

    February 17, 2012

    Key Aspects of Defence Offsets: Negotiating the MOU between Bidder and Offset Partner

    The DPP has proved to be a dynamic document, with improvements with every successive version minimising ambiguities. Documents where ambiguities are either absent or minimum; documents that are transparent and are open to anyone connected; and documents that have good guidelines and directives, serve as an anchor when resolving conflicts that may arise in execution of activities in the related field. The DPP is one such document in the process of defence procurement.

    July 2010

    Mahindra’s Giant Leap into Defence Production: The Need for Further Policy Initiatives to Promote Private Sector

    While Mahindra’s foray into defence production and the acquisition of foreign companies demonstrates the private sector’s initiative, the government needs to introduce further reforms to promote the role of private companies in Indian defence industry.

    December 22, 2009

    Defence Acquisitions: The Question of Systemic Inefficienices and Effectiveness

    The effectiveness of the procurement process needs to be viewed in context of the operational and structural readiness of the armed forces. If the existing framework proves to be weak and unable to deliver required levels of military preparedness, the framework may have to be re-laid for its effectiveness and deliverability.

    December 03, 2009

    Will Indian Defence Private Sector Deliver with Recent Policy Changes?

    With the growth of the public sector in Defence Production a large number of industrial units in the Private Sector has also grown with varied scales of operation in areas like outsourcing of raw materials, components, sub-systems, assemblies and sub-assemblies.

    November 24, 2009

    Economic Downturn: Options for MoD

    The present global economic crisis has slowed down the growth of the Indian economy, affecting among others, the fiscal situation and the revenue mobilisation potential of the central government. Defence being one of the largest recipients of central government expenditure, the present crisis casts a doubt on the adequacy of future resources. This commentary discusses some major options that India’s Ministry of Defence needs to consider in order to withstand the likely resource constraints in the coming years.

    May 26, 2009

    India's Defence Offset Policy

    Although India has established a formal mechanism for implementation of the defence offset policy, the structure and procedures lack the thrust to fulfil the objective of energizing the Indian defence industry. Besides, the policy is not supported by the existing Foreign Direct Investment (FDI) and licensing policies. While evidence suggests that domestic industry can absorb offsets, what India needs is an effective body to handle offsets, liberal FDI and licensing policies, and a better banking provision.

    March 2009

    Is India on the Path to Vibrant Defence Industry?

    What does it take to be ‘a vibrant industry’ or more specifically ‘vibrant defence industry’? Broadly, it would demand that the industry should be innovative in terms of processes and products, its base and structure should have large dimensions horizontally, vertically, and technologically to be responsive enough to keep pace with the changing strategic expectations of the nation. Defence exports and imports should be a matter of deliberate political or commercial policy choices and not a result of security compulsions.

    October 08, 2008

    India’s Defence Offset Policy 2008

    The Ministry of Defence (MoD) recently issued a new set of rules for the procurement of arms, ammunition and other defence related products and services. The rule book, known as Defence Procurement Procedure 2008 (DPP 2008), has revised, among others, the offset policy that was first promulgated in 2005 and subsequently revised in 2006. The revised offset policy which retains the earlier minimum 30 per cent offset requirements in defence imports of Rs. 300 crore or more has added a provision of offset banking, besides enlisting a number of categories of defence products.

    August 19, 2008

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