SP's Aviation - - NEWS WITH VIEWS - —By Air Mar­shal B.K. Pandey (Retd)

THE IS­SUE OF INDIGENISATION of the In­dian de­fence in­dus­try has been on the cards for over a decade-and-a-half. Since 2002, par­tic­i­pa­tion of the pri­vate sec­tor in de­fence pro­duc­tion has been an im­por­tant part of the pol­icy of the gov­ern­ment. But the first sig­nif­i­cant step that the gov­ern­ment took in the pur­suit of this ob­jec­tive was in 2006 when a new pro­vi­sion aimed at pro­mot­ing indigenisation was in­tro­duced in the De­fence Pro­cure­ment Pro­ce­dure. This was the in­tro­duc­tion of the ‘Make’ cat­e­gory un­der which an In­dian com­pany in the pri­vate sec­tor would be per­mit­ted to un­der­take de­sign and de­vel­op­ment of com­plex sys­tems.

What was com­fort­ing for In­dian com­pa­nies was that the gov­ern­ment would fund 80 per cent of the cost of de­vel­op­ment of the selected items. The In­dian com­pany would still have to de­pend on ac­qui­si­tion of ad­vanced tech­nol­ogy from abroad which would not be easy. The In­dian De­fence Re­search and De­vel­op­ment Or­gan­i­sa­tion (DRDO) lacked the ca­pa­bil­ity to pro­vide the re­quired tech­nolo­gies to sup­port indigenisation of the de­fence in­dus­try.

De­spite the pro­nounce­ments, there was no com­pre­hen­sive re­mod­elling by the In­dian Gov­ern­ment of the pol­icy to make the busi­ness en­vi­ron­ment con­ducive for heavy in­vest­ment both by the for­eign orig­i­nal equip­ment man­u­fac­tur­ers (OEMs) and In­dian en­trepreneurs. In Fe­bru­ary 2013, A.K. Antony, the then De­fence Min­is­ter, while ad­dress­ing the au­di­ence at a sem­i­nar where rep­re­sen­ta­tives of the lead­ing com­pa­nies in the In­dian pri­vate sec­tor were present, re­peat­edly as­sured the gath­er­ing that his ministry would strive for greater indigenisation. He went on to state: “The gov­ern­ment in­tends to change two key poli­cies to al­low the pri­vate sec­tor a greater role.” Un­for­tu­nately, no rad­i­cal changes were in­tro­duced and par­tic­i­pa­tion by In­dian com­pa­nies in the pri­vate sec­tor was largely lim­ited to ex­ploit­ing busi­ness op­por­tu­ni­ties that lay in the ful­fil­ment of off­set obli­ga­tions of for­eign in­vestors. True indigenisation of the In­dian de­fence in­dus­try con­tin­ued to remain a dis­tant dream.

Even to­day, the In­dian armed forces con­tinue to rely on for­eign sources for around 70 per cent of their re­quire­ment of mil­i­tary hard­ware. Cur­rently, In­dia is re­garded as one of the largest im­porters in the world of de­fence equip­ment. The high level of de­pen­dence for de­fence equip­ment on sources abroad is a ma­jor weak­ness the In­dian armed forces are af­flicted with. This de­fi­ciency has the po­ten­tial to un­der­mine the se­cu­rity of the nation as the In­dian armed forces could well be de­nied crit­i­cally re­quired equip­ment in times of cri­sis ow­ing to political mis­align­ment or some other im­pon­der­ables that could im­pinge on the re­la­tion­ship with the arms sup­plier. This is a weak­ness that Prime Min­is­ter Naren­dra Modi is de­ter­mined to root out in due course. He re­ferred for the first time to the con­cept of Strate­gic Part­ner­ship in his ad­dress at the tenth edi­tion of Aero In­dia In­ter­na­tional Air­show at Ye­la­hanka, near Ben­galuru, in Fe­bru­ary 2015. He said: “The coun­try should aim to man­u­fac­ture 70 per cent of mil­i­tary hard­ware do­mes­ti­cally in the next five years and re­move the tag of being num­ber one im­porter of de­fence equip­ment. From sell­ers, for­eign firms must turn into strate­gic part­ners.”

Post clear­ance by the MoD, the pol­icy on Strate­gic Part­ner­ship will now go to the Cabinet Com­mit­tee on Se­cu­rity for fi­nal ap­proval. Once im­ple­mented, this pol­icy will be a ma­jor step for­ward in the nation’s march to­wards build­ing a strong and vi­brant in­dige­nous mil­i­tary-in­dus­trial com­plex. The strate­gic part­ner­ship be­tween OEMs and In­dian com­pa­nies could be struc­tured as joint ven­tures, eq­uity part­ner­ship or any other mu­tu­ally ac­cept­able ar­range­ment be­tween the com­pa­nies in­volved would be ac­cept­able sub­ject to the own­er­ship con­di­tions stip­u­lated by the MoD.

One of the first things that Prime Min­is­ter Modi did on as­sum­ing of­fice was to put the DRDO on no­tice to shed the lack­adaisi­cal ap­proach and de­liver. The MoD was tasked to carry out a re­view of the or­gan­i­sa­tion and de­ter­mine the mea­sures necessary for its re­vi­tal­i­sa­tion. But the launch of the Strate­gic Part­ner­ship model which is de­signed to pro­pel the In­dian de­fence in­dus­try in the pri­vate sec­tor to the fore­front has been the strong­est mes­sage to DRDO on their fail­ure to de­liver. The con­fi­dence of the In­dian armed forces in the con­cept of Strate­gic Part­ner­ship is re­flected in the state­ment by Gen­eral Bipin Rawat, Chief of the Army Staff, when in a sem­i­nar he said, “The In­dian armed forces must fight the next war with in­dige­nous so­lu­tions.” Hope­fully, indigenisation of the In­dian de­fence in­dus­try will no longer be a dream!

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