Expect 70 % Indigenisation In Defence Even Before 2027

ASHOK Kumar Gupta, Secretary, defence production, says that government efforts had immensely incentivised private sector participation in manufacturing for the defence forces, pointing to the spurt in the licences issued between May 2014 and June 2016.

- Ashok Kumar Gupta

Altogether 125 licences were issued in the span of the two financial years, compared to 217 licences issued between 2001 and May 2014. In a freewheeling conversation with Suman K. Jha, he discusses a range of issues, including the promises and challenges of the Make in India initiative in defence production.

Many consider the government set target of 70 per cent indigenisation in defence production by 2027 too ambitious. It is your target too, but is it achievable?

We would like to achieve it even earlier. A number of initiatives have been taken in this direction. We are on the right path. The country is now on the threshold of defence manufacturing under the Make in India initiative. It aims to reverse the current ratio between imports and indigenous manufacture of defence material, without adversely affecting the requirements, capability and preparedness of the Armed Forces. Achieving this will require equipping the country with the ability to design, develop, manufacture, integrate, test, maintain and upgrade defence systems we require.

India is in the midst of modernizing its Armed Forces and an estimated $250 billion will be spent on capital procurement over the next ten years. Moreover, in the new Defence Procurement Procedure 2016, ‘Buy (Indian-IDDM)’, ‘Buy (Indian)’, ‘Buy & Make (Indian)’ are the most preferred categories, which means that increasingly Request for Proposals (RFP) will be issued to the domestic industry. Foreign OEMs (original equipment manufacturers) can leverage domestic demand by tying up with domestic companies, either for collaborative R&D followed by production or through transfer of technology for production through joint ventures. Alternatively, they can set up their own manufacturing base here.

India plans to boost arms exports 20-fold to $3 billion over a decade. How are things shaping up?