India surrounded by hostile countries China & Pakistan has the third largest armed forces of the world. The allocation of Defence in the India’s union budget is approx USD 34.53 billion and 31.1% of the defence budget is spent on capital acquisitions. 60% of defence related requirements are met by imports which offers a huge opportunity for import substitution. The company is primarily responsible to boost growth of private sector industries by 10 -15% through technological up gradation and realizing greater revenues through defence development and a production work. Import substitution is also a key objective of our company. We provide necessary support to large, medium. small companies to create ecosystem to promote growth of the country as a whole. We keep interacting with defence procurement agencies such as OFB and its 41 of its factories. DPSU’s (HAL, BEML,BDL, five dockyards and MIDHANI for all types of requirements, mechanical, Aeronautic, Electoral, Electronics, Telecommunication, Defence conference terms-(Clothing, Apparels)etc.
In order to realize research and development efforts related to defence development and production to boost up import substitution and development of new products, we create strong linkages between DRDO labs. IIT/NIT and academic institutions of high repute with private sector industries of all types so as to create an environment of innovation, research and development. As member of CII and other industrial associations, we share our experience with private sector industries with these associations so that they can guide MOD for creating suitable enabling environment.
Private Sector opportunities in Defence products manufacturing and Supply chain sourcing
Defence Production Policy, 2011 has encouraged indigenous manufacturing of defence equipment. Defence Procurement Procedure (DPP) has been amended in 2016 to provide for the following
• New Category of capital procurement Buy Indian-IDDM (Indigenously Designed, Developed and Manufactured) introduced to encourage indigenous design, development and manufacturing of defence equipment.
• Preference to Buy (Indian-IDDM) Buy (Indian)’ and Buy and Make (Indian)’ over Buy (Global) categories of capital acquisition.
• Clear and unambiguous definition of indigenous content.
• Provision for Maintenance TOT (Transfer of Technology) to Indian Industry partners.
• Provision to allow foreign OEM (Original Equipment Manufacturer) to select Indian Production agency.
• Requirement of minimum indigenous content has been enhanced/rationalized.
• Services as an avenue for discharging offsets have been re-introduced.
• Defence products list for industrial licensing, has been articulated in June 2014, wherein large numbers of parts/components, casting/ forging etc. have been excluded from the purview of industrial licensing.
• The defence security manual for the private sector defence manufacturing units has been finalized and put in public domain by the Department of Defence Production. The manual clarifies the security architecture required to be put in place by the industry while undertaking sensitive defence equipment.
• The MAKE procedure, which aims to promote research & development in the industry with support from the government and the placement of orders, has been promulgated with provision for 90% funding by Government and preference to MSMEs in certain category of projects.