The Secretary (Defence Production) Raj Kumar Singh said in New Delhi that the Indian Industry today is ready to assume greater responsibility in making the country self-sufficient in defence production.
“The resurgence of Indian manufacturing sector has been impressive. Not only are Indian companies growing within the country, but are also expanding abroad and many Indian firms are becoming transnational companies,” Singh said.
According to him, the Indian manufacturing sector is now internationally competitive with highest quality standards, efficiency and manufacturing facilities. India is also fast developing into a manufacturing hub for world corporations eager to leverage this sector’s proven skills in product design, configuration and customization with creativity, assured quality and value addition.
Since 2001, the Defence Industry sector in India is open to 100 per cent Indian private sector participation with foreign direct investment permissible up to 26 per cent. The Indian Defence Industry in the private sector is now gradually assuming the role of system integrator and manufacturer of complete defence equipment and systems. This is a major shift in the role of private sector in India from its earlier supporting role to the public sector by supplying raw materials and components, sub-systems etc.
“Indigenisation in defence production is now one of the major thrust areas of the Government. Consequently, our efforts are now directed towards reduction of defence imports and promoting indigenization in defence production sector with the active support of the Indian Defence Industry, both in the public as well as in the private sector. Various steps have been taken in this direction,” Singh added.
Singh stated that consequent to the introduction of Defence Offset Policy, defence offset contract valued over Rs. 8000 crores have so far been signed and many more are in the pipeline. As a result of periodic review of Defence Procurement Procedures, changes have also been introduced in the Defence Offset Policy. Banking of offsets credits is now permissible. The realization of offsets benefits will now be speedier as the policy offset banking will allow the Indian industry to start offsets even before finalizing of contract with foreign OEMs. This will also enable foreign vendors to create offset programme in anticipation of future obligations.”
India is a growing market and emerging as a strong economy. With the projected growth of the Indian economy, its defence needs are also correspondingly growing. India, therefore, offers excellent opportunities, both for domestic as well as foreign companies, to forge new alliances and partnerships in the form of joint venture, co-production and co-development arrangements in the Defence sector.
In the context of the ongoing modernisaiton of the Armed Forces and the acquisition reforms undertaken by the Government, the Indian defence market now offers tremendous opportunities for formation of joint ventures and direct sourcing by the global players. India needs highly sophisticated and technologically advanced products to meet the requirements of the Armed Forces.
