Thursday, November 11, 2010

India To Introduce Defense Production Policy

Aerospace Daily-Aviation Week
Nov11, 2010


NEW DELHI – India will release its Defense Production Policy and also introduce major changes to the delayed 2010 Defense Procurement Policy (DPP) in January 2011, Defense Minister A.K. Antony said Nov. 10.

“So now we are going to take some more drastic steps to achieve our goal of speedy indigenization,” Antony said.

In anticipation of the move, many international companies have formed Indian subsidiaries.

Meanwhile, the Associated Chambers of Commerce and Industry of India has recommended DPP 2010 should consider a higher foreign direct investment cap of 49% to encourage foreign joint ventures.
The chamber also recommended that supplies of homeland security and dual-use items, technology-based projects and some sections of civil aviation engine parts and avionics should qualify as offsets. It is likely that some of these changes will be incorporated into DPP 2010 and be announced next year.

“Our aim is to have a strong defense industrial base in India, because a country like India cannot indefinitely depend on foreign suppliers for [the] majority of our equipment,” Antony said.

India currently imports 65-70% of its defense equipment. India’s public sector shipyards will compete with its private shipyards to get projects for the Indian navy.

“All the Indian navy’s procurements in the future will be ‘Buy Indian, Make Indian.’ That will be the major component of our procurement policy. That will help us to have a strong defense industrial base in India,” Antony added.

The need for government facilities to be cost-competitive – delivering quality standards and maintaining consistency – was stressed.

“Timely delivery of the products is an area of concern which we are not able to meet for various reasons,” State Minister of Defense Pallam Raju said.
- Neelam Mathews

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