Reforms afoot to promote self-reliance in defence sector: Minister

Bengaluru: Minister of State for Defence Ajay Bhatt in a written reply to Akhilesh Prasad Singh in Rajya Sabha apprised that several significant projects including 155mm Artillery Gun system 'Dhanush', Bridge Laying Tank, Light Combat Aircraft 'Tejas', 'Akash' Surface to Air Missile system, Submarine 'INS Kalvari', Inshore Patrol Vessel, Offshore Surveillance Ship, 'INS Chennai', Anti-Submarine Warfare Corvette (ASWC), Arjun Armoured Repair and Recovery Vehicle, Landing Craft Utility, Bridge Laying Tank, Bi-Modular Charge System (BMCS) for 155mm Ammunition, Thermal Imaging Sight Mark-II for T-72 tank, 25 T Tugs, Water Jet Fast Attack Craft, Offshore Patrol Vessel, Fast Interceptor Boat, INS Kalvari, INS Khanderi, Medium Bullet Proof Vehicle (MBPV), Lakshya Parachute for Pilotless Target Aircraft, etc. have been produced in the country under the 'Make in India' initiative of the Government in the last few years.

Bhatt said, the government has taken several policy initiatives and brought reforms to promote self-reliance in defence manufacturing. These policy initiatives are aimed at encouraging indigenous design, development and manufacture of defence equipment in the country, thereby reducing dependency on imports in long run.

Important policy initiatives and reforms are as under:

DPP-2016 has been revised as Defence Acquisition Procedure (DAP)- 2020, which is driven by the tenets of Defence Reforms announced as part of 'Aatmanirbhar Bharat Abhiyan'.

He responded saying that in order to promote indigenous design and development of defence equipment 'Buy {Indian-IDDM (Indigenously Designed, Developed and Manufactured)}' category has been accorded top most priority for procurement of capital equipment.

Ministry of Defence has notified two 'Positive indigenisation lists' of 209 items for which there would be an embargo on the import beyond the timeline indicated against them. "This would offer a great opportunity to the Indian defence industry to manufacture listed items using their own design and development capabilities to meet the requirements of the Indian Armed Forces.

The 'Make' Procedure of capital procurement has been simplified. There is a provision for funding up to 70 per cent of development cost by the Government to Indian industry under Make-I category. In addition, there are specific reservations for MSMEs under the 'Make' procedure," Bhatt gave a detailed response.

It was also notified that the procedure for 'Make-II' category (Industry funded), introduced in DPP-2016 to encourage indigenous development and manufacture of defence equipment has number of industry friendlyvprovisions such asbrelaxation of eligibility criterion, minimal documentation, provision for considering proposals suggested by industry /individual etc.

So far, 58 projects relating to Army, Navy & Air Force, have been accorded 'Approval in Principle'.

The government has approved enhanced delegation of Financial Powers under Capital Procurement to levels below the Vice-Chief of Armed Forces in February. It has also approved enhanced delegation of Financial Powers in the Make-I category under which Government funding up to 70% of the prototype development cost is available for Design & Development of equipment, systems, major platforms or upgrades thereof.

An Inter-governmental Agreement (IGA) on "Mutual Cooperation in Joint Manufacturing of Spares, Components, Aggregates and other material related to Russian/Soviet Origin Arms and DefenceEquipment" was signed in September, 2019. The objective of the IGA is to enhance the "After Sales Support" and operational availability of Russian origin equipment currently in service in Indian Armed Forces by organising production of spares and components in the territory of India by Indian Industry by way of creation of Joint Ventures/Partnership with Russian Original Equipment Manufacturers (OEMs) under the framework of the "Make in India" initiative.

"Defence Products list requiring Industrial Licences has been rationalised and manufacture of most of parts or components does not require Industrial License. The initial validity of the Industrial Licence granted under the IDR Act has been increased from 03 years to 15 years with a provision to further extend it by 03 years on a case-to-case basis," Bhatt responded.

Department of Defence Production has notified 46 items under the latest Public Procurement Order 2017 notified by Department for Promotion of Industry and Internal Trade (DPIIT), for which there is sufficient local capacity and competition and procurement of these items shall be done from local suppliers only irrespective of the purchase value.

Defence Investor Cell (DIC) has been created in Feb-2018 in the Ministry to provide all necessary

information including addressing queries related to investment opportunities, procedures and regulatory requirements for investment in the sector. So far, 1182 queries have been addressed by DIC.