TOWARDS AN INDIGENOUS MILITARY-INDUSTRIAL BASE

The rush of reforms in the defence private sector has grabbed headlines with Tata, Adani, Mahindra and others developing mega projects like the C295 MW military transport aircraft to battle tanks. The real action is in smaller companies.

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Mega projects are creating an ecosystem for defence that is nurturing special capabilities, onboarding technology and patents and will create scope for both domestic defence market and for exports in the long run.

There is enthusiasm and entrepreneur self-belief in companies that India can over time successfully pivot to making defence equipment locally. Additionally, biggies like Reliance Industries and Adani are also turning into venture capitalists putting money into nascent defence industry start-ups.

The policy push Dedicated defence corridors are the upfront infrastructure incentive by the government. The quality of this infrastructure will eventually determine the success or failure of the Make in India initiative in defence. Water connections, electricity, road and rail connectivity are the basic infrastructure needs to come upfront at competitive prices. Living standards for management and workers are often overlooked but in building defence equipment, a well-trained engineer will need a good house a good school or college, nearby hospitals and the like. These soft issues are very important for the success of the defence corridors. The little details will impact outcomes.

India has a very poor record in its special economic zones. This will take political capital to transform potential to reality. Early evidence says that things are already moving. Union MoS for Defence- Ajay Bhatt, said recently in parliament that in the Tamil Nadu corridor the investment already of about $250 million has occurred. Similarly, another $250 million has actually been invested in the Uttar Pradesh defence industrial corridor. These are sunrise times and the long gestation period must be endured. The list of items in which defence equipment can only be sourced from India has galvanised local entrepreneurship.