Aerospace Diary

Neelam Mathews July 23, 2012  The much-awaited Defense Procurement Policy 2012 has been cleared by the Cabinet Committee on Security (CCS), Aerospace Diary learns. "The offsets policy will be released very soon. There were a few points that needed to be ironed out, a reason why it was late," a senior official in the MoD told Aerospace Diary. The policy will not be retroactive and will be valid from the date it is introduced, we are told. While the policy is expected to include  transfer of technology (TOT), vendors remain unclear how this will be implemented without any body to monitor it nor the method of payment for TOT. The question of IPR also needs to be addressed. The  2012 USIBC  advocacy agenda advancing the U.S. – India defense commercial relationship had asked for  India to formulate a robust offset policy that promotes transparency and  predictability, leading to a meaningful build-up of India’s indigenous industry capabilities  ...

OEMs Unhappy That Relaxed Indian Offset Policy Is Not Retroactive AINONLINE by    NEELAM MATHEWS July 12, 2012, 11:00 AM Recent upgrades to  India’s Defense Procurement Policy  ( DPP ) 2011 that are to be incorporated in  DPP  2012 could soon allow foreign vendors to buy from Indian companies assemblies that contain foreign content while getting credit for the entire assembly, as long as the content is paid for in rupees. The period of time allowed for the discharge of offset obligations is also being extended by two years, up to four, and that for the banking of offsets from five to seven years. A multiplier of factor 1.5 will be permitted through a non-equity route for offset obligations relating to direct exports, foreign direct investment, transfer of technology ( TOT ) or investment in kind. While the objective is to ensure establishment of a consistent, authoritative, empowered offsets agency serving as a ...

Neelam Mathews March 7, 2012 The new offsets policy that was to be released in August last year, is finding itself caught between two lobbies- one that wants to incorporate the multiplier clause and on that doesn’t. “There is a lack of consensus in the MoD. Besides, with the ruling party having performed miserably in the recent state elections, Congress might not want to make any moves for fear it might become an electoral issue that could affect its chances for elections in 2014.  "Dogged by the Bofors scandal that brought the government down in the past, I expect they’ll lie low and major decisions might take a backseat.” an official tells Aerospace Diary. We also learn the recent affinity to Western systems might also have brakes pulled on them. Indian manufacturers want the plug pulled on multipliers in the offset policy while their foreign counterparts have been pushing for them. “The Indian industry is not mature as yet. Once in 2-3 years, manufacturing gets moving, be...

Neelam Mathews Feb 24, 2012 The discussion held yesterday (Feb 23) on ratifying the Offsets policy remained “inconclusive,” Aerospace Diary learns. A meeting of the Defense Acquisition Council chaired by Defense Minister A.K. Antony looked at proposals to amend the offsets policy, part of the DPP 2011. The industry was hoping certain issues would be cleared including transfer of technology as offsets; multipliers and offsets in commercial shipbuilding. With a central implementing body required, the DAC was to look at   the Defense Offset Facilitation Agency (DOFA) as the empowering body for offsets.