Focus on Make in India in Defence: Projects under Make II category will go to MSMEs, says SIDM

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Updated: May 14, 2020 4:31 PM

However, critical technologies which have been designed and developed by the Ordnance Factory Board and the Defence Research and Development Organisation can gradually be shared with the private sector and MSMEs.

Some projects including guns for the Indian Army, 83 Light Combat Aircraft for the Indian Air Force, small and big boats for the Indian Navy are being produced here in India.Some projects including guns for the Indian Army, 83 Light Combat Aircraft for the Indian Air Force, small and big boats for the Indian Navy are being produced here in India.

To push the Make in India initiative in the defence sector and lend a helping hand to the private sector and MSMEs, the Ministry of Defence (MoD)has started identifying projects that can be handed over to them. Sources have confirmed to Financial Express Online that “The MoD has started the process of identifying projects which can be fast-tracked and produced locally in India. This will not only help save the funds but will also help our MSMEs and the private sector.”

Some projects including guns for the Indian Army, 83 Light Combat Aircraft for the Indian Air Force, small and big boats for the Indian Navy are being produced here in India. However, critical technologies which have been designed and developed by the Ordnance Factory Board and the Defence Research and Development Organisation can gradually be shared with the private sector and MSMEs.

Helping MSMEs & Private Sector

A senior officer of Society of Indian Defence Manufacturers (SIDM) told Financial Express Online that “Majority of MSMEs can take up “build to print” kind of manufacturing projects at part, component, sub-system level. This is true for all disciplines – mechanical, electrical, electro-mechanical, hydraulics, electro-hydraulics, optics and electronics etc. Some of them can do a complete system too. In technology space, many Professionals have created entities with niche expertise in electronics, communication, software, embedded software, etc.”

The officer who wished to remain anonymous says “These MSMEs take up “Build to Specs” projects, at various levels- sub-system, sub-assembly, LRUs in aviation, and small systems. They can design basis specifications or even requirements, test, validate performance, integrate etc. Such MSMEs also tap existing Eco-system of manufacturing industries – metal forming, machining, precision machining, special processes including coatings, PCB manufacturing etc.”

What projects can the DRDO & OFB share?

“OFB involves MSMEs only for the manufacturing of parts/sub-assembly on the build to print basis. OFs themselves are doing manufacturing under license from FOEMs. They only have drawings. With MAKE-II projects, they will start giving projects on the build to specs basis. One has to wait and see. But they have put up a lot of such requirements under MAKE-II and Import substitution,” he said.

Is there a lack of clarity on projects DRDO can share with the MSMEs and SMEs?

“No, there is no lack of clarity as far as the projects Defence Research and Development Organisation (DRDO) is concerned. The DRDO is already associating with MSMEs for developmental projects. And, many SMEs are associated with DRDO. With provisions like Make II and Technology Development Fund, they can do much more now.”

On plans of the government to push for indigenization of the defence projects, Puneet Kaura, Managing Director & CEO at Samtel Avionics Limited, says “The Indian defence industry, especially the indigenous and MSME players had already been under severe resource crunch in the recent past. The COVID-19 pandemic lockdown has put further stress on these companies and we have collectively been looking for some sops or support from the government. With the government making some plans to push indigenous projects through Make in India, the Indian defence manufacturing industry will receive the much-needed support to help it survive.”

“The indigenous manufacturing companies and MSMEs not only form the backbone of the Indian Defence industry but also provide employment to the talented resource pool which passes out of government sponsored as well as private institutions every year. Any step by the government to support the MSMEs will generate further employment opportunities for this critical segment of our value chain,” Kaura says.

Talking about his company Samtel’s joint venture with the state owned Hindustan Aeronautics Ltd, Kaura says, “This JV has been a part of HAL’s journey towards indigenisation for many years now, and is a key supply chain partner of HAL in multiple indigenous programs, including LCA.”

And, “ If the order for 83 Light Combat Aircraft (LCA) that is currently awaiting a nod from the Cabinet Committee on Security (CCS) gets approval, then not only will HAL get a boost, but being a part of the supply chain, Samtel HAL JV will also gain from it. If the government does go through with this plan as it appears, Samtel would certainly welcome it,” he concludes.

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