Self Defence is the Best offence

Context – Recently announced defence reforms in tandem with other policy measures have the potential to promote self-reliance and transform India into a major defence manufacturing hub.

Reason for lack of indigenisation

• Lack of clarity in policy at all level: encouraged imports.
• Funding issues: manpower intensive defence allocation and resource crunch.
• Overly ambitious weapons specifications:  have favoured imports at the cost of domestic industry (CAG report).

Recent announcement in Defence sector

• Ban on import of certain items: push indigenous manufacturing and encourage armed forces, weapon designers and producers to develop a common interest.
• Separate budget provisions for procurement from local resources.
• Corporatisation of Kolkata head-quartered OFB (Ordnance Factory Board): unleash its vast potential and usher in a new era of autonomy, transparency and accountability.
• FDI cap in defence production: Under automatic route from 49% to 74%, to expedite the setting of manufacturing units in India.
• Draft defence procurement procedures document (DPP-2020): enhance efficiency of procurement process.
• Project management unit: to support defence contract management and realistic setting of the general staff qualitative requirements (GSQR) and overhauling trial and testing procedures to significantly improve defence procurement.

Suggested Reforms

• Defence services estimates (annual document provide break-up of allocation for defence services) should specify which items to be procured through imports or indigenous resources.
• Listing of factories on stock exchange.
• Devising a GSQR formulation process that is objective, transparent and supportive of domestic manufacturing would help advance towards “Make in India” in defence sector.