The forthcoming event 'Aero-India 2015 is poised to be the
10th international show showcasing wide range of defence and civilian
aircraft.This time,however,the focal theme of the event stresses on 'MAKE IN
INDIA' in aerospace,defence,civil aviation,airport infrastructure and defence
engineering.
India imports a staggering 60 percent of defence goods from foreign countries.The prominent suppliers include USA,Israel,France and Russia. The 'defence diplomacy' has therefore become a buzzword in India's foreign policy imperatives,with several countries eyeing India as a significant export destination,This is,however,a disturbing trend for India's long term national interests.It contributes to India's widening Current Account Deficit(CAD) due to enormous defence imports and raises our defence budget to disproportionate levels.Moreover,it could impact our security interests in an age where cyber-related crimes and technological sophistication have reached new heights.
The previous events have failed to boost our indigenous
capabilities and infrastructure.India has a weak defence industrial base
unit.Moreover,India do not have a well trained man-power and human capital
catering to our defence needs.It is ironical that a major chunk of the defence
budget is spent on salaries and capital acquisitions from foreign countries
thus leaving less manoeuvering space for Research and Development(R&D)
expenditure.The powerful countries like USA,Russia as well as militarily
resurgent China owes much of their defence modernisation to Research and
Development,which is not the case with India.
Thus,it is expected that Aero-India 2015 would be a
game-changer in promoting self reliance and indigenisation in our defence
capabilities.India needs a suitable platform that would incentivise the private
sector,both foreign and domestic players,in making joint efforts with the
defence PSUs in the area of defence manufacturing.As of today,the government
has included 'offset policy' as an integral part of defence procurement policy
which mandates compulsory indigenisation in certain sectors.The Defence
Procurement Policy mentions 'buy Indian' and 'buy and make Indian' as a
cherished objective.Moreover,the licensing norms and procedures in relation to
producing defence goods and its spare parts have been streamlined.The
government is committed to providing various tax incentives,export incentives
and area-based incentives to the participating private entities.
Our defence programme is not a big failure altogether.For instance,we have excelled in Integrated Guided Missile Development Programme(IGMDP).That said,we have indigenously developed our missile capabilities since 1983,the latest being the successful Agni-5 missile test.However,we still have a lot of catching up to do in other areas.We still import a major chunk of our basic inventories like artillery guns,tanks,fighter aircraft,surface ships,submarines etc from foreign countries.Similarly,in relatively new areas of defence like cyber and electronic warfare,disruptive networks and stealth technology,the world has progressed far ahead of us.
ReplyDeleteTherefore,we need a proper planning process to modernise our conventional defence inventory.At the same time,we need to strengthen the defence industrial base in a manner that matches the latest requirements.India squandered many productive years in trying to create an indigenous Tejas fighter plane only to be fitted with an imported GE engine.India has still not indigenously manufactured a fourth generation fighter aircraft,while the developed nations have already built a fifth generation aircraft.Similarly,another significant challenge is to create an enabling environment so that all stakeholders can effectively participate in defence sector.Rules are to be so designed that there is an easy transition from manufacture to testing to induction.It is ironical that Bharat Fauz,a reputed Indian company manufactures artillery guns,but do not have the license for testing facilities here.Therefore.an enabling environment is necessary for creating a level-playing field for the stakeholders.
The enabling environment for the pvt sector would be created if they(especially small and medium enterprises) are provided incentives to participate in other sectors of defence industrial base such as assemblies,spare parts and components.The larger challenge is to attract FDI with technology transfer.Merely increasing the FDI limit to 49 percent would be insufficient as FDI in defence sector is different from FDI in retail sector.That said,most countries have export control laws that act as a deterrent for the outright transfer of technology.Therefore,strategic partnerships with foreign countries are crucial for meaningful FDI in defence.The management of strategic partnerships abroad is as crucial as overhauling the regulatory environment at home.
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