The fifth international land and naval systems exhibition?Def Expo India 2008?will be held from February 16 to 19 at Pragati Maidan, New Delhi. This is a biennial event, conceptualised in 1998 by the Ministry of Defence (MoD) and Confederation of Indian Industry (CII), and held since 1999. It showcases military and naval products meant for possible acquisition from without and/or export from within, and holds some promise of joint ventures between Indian and foreign companies aimed at achieving some self-reliance in defence equipment.
With a projected military acquisition plan worth $40 billion by the end of the 11th defence Five-Year Plan (2007-2012) and possibly another quantum jump to $60 billion in the 12th Plan, India may still be nowhere near America?s half-a-trillion dollar defence budget, but the figures are big enough for the country to be dubbed a ?weapon merchants? paradise?. The world?s defence majors have almost all established their presence here, and are eager to showcase their products.
There are four reasons?that are advanced for the institutionalisation of defence exhibitions. First, India?s dismal record in indigenous defence production and a long history of import dependency have forced the leadership to look at policy alternatives. This has resulted in opening up of the sector to private sector participation. The Def Expo provides an open platform for interactions among stakeholders like the MoD, armed forces and public and private defence companies. Foreign companies smell future business worth billions of dollars, and are jostling for attention in India, while their Indian counterparts look for export and collaboration opportunities.
Second, India?s arms import dependency had long been a story of a ?dominant single source of supply? (read Russia). With India?s defence procurement strategy now leaning towards greater supply diversification and a more robust competitive environment, a ?basket of choices? opens up for future military acquisitions. Def Expo will showcase products by more than 300 companies, exposing India?s decision-makers not only to existing systems in the market but also to futuristic possibilities. Much sourcing time is saved.
Third, India?s quest for self-reliance in defence under contemporary conditions underlines the importance of private sector participation, on the one hand, and revitalising the public sector, on the other. Going a little beyond, India?s defence sector has also been held ajar for FDI up to 26%, thus indicating that foreign companies could contemplate long-term stakes in India. A nascent picture of three categories of companies?state-owned, Indian private and foreign?competing and cooperating (through joint ventures, collaborative efforts) with one another in the hitherto closed defence sector is slowly emerging. Def Expo symbolises exactly this through lively and active interactions as well as consultations.
And, last but not least, India?s arms production and procurement policies have shown some signs of improvement and transparency. The defence procurement procedure has been revised thrice in a span of five years (2002, 2005 and 2006) and another round of revision is due this year. The evolving dynamics of procurement policy formulation notwithstanding, contentious issues like offsets, license production, ToTs, long evaluation processes and a few others need further deliberation by all stakeholders. Def Expo organises a series of parallel seminars for precisely these stakeholders to debate such issues, inputs from which are channelised into the government decision-making mechanisms. These inputs, in turn, help refine policies related to defence production and procurement.
While exercises like Def Expo encourage countries like India to embrace global competition, even if it?s only possible through a gradualist approach, it is not easy for all these vendors to pursue military business in India. They must contend with archaic procurement procedures, rigid institutional mechanisms and, above all, a traditional mindset that contributes to resistance to reform. Although the last few years have witnessed enormous efforts from the major stakeholders to address the prevailing problems, the pace of reform in the defence sector has been disappointingly slow.
The task of converting challenges into opportunities rests on the shoulders of the organisers of such events as well as stakeholders like the private sector, academia and media. Multi-disciplinary discussion of India?s hardware preparedness would serve the country well, and the government should be willing to respond to and consider genuine demands.
The biggest challenge lies in changing the structural bureaucratic mechanisms to impart them with the dynamism and boldness needed to pursue reform initiatives that can achieve transparency in the armaments arena. If the Def Expo delivers a debate on critical issues and offers innovative solutions to the government for consideration, it will have achieved its objectives.
The author is a senior fellow in security studies at the Observer Research Foundation, New Delhi. Views are personal.
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