In the last five years, FDI in Defence and Aerospace sector touched Rs 1,664 crore. And there has been a significant rise in defence exports touching Rs 10,745 crore in 2018-19 from Rs 4,682 crore in 2017-18.
Calling for a multi-pronged approach to achieve the aim of ‘Make in India’, defence companies have huge opportunities in contributing to the domestic market in addition to exports, says the government.
The defence minister Rajnath Singh in his first major interaction, met with nearly 50 CEOs of the defence industry including representatives of foreign companies. The meet was aimed at addressing the concerns of the industry and to encourage both private industry investment in the defence sector and also strengthening defence PSUs and Ordnance Factory Board (OFB). There were representatives of companies including the US-based Lockheed Martin, Boeing Company, Tata Company, Bharat Forge, BEL, GRSE, Cyient among others were present.
Speaking at the ‘Make in India in Defence Industry Roundtable’ Ministry of Defence (MoD), the defence minister said that “the FDI policy in the defence the sector has been liberalised and that the Strategic Partnership (SP) model has been notified to establish defence manufacturing infrastructure and supply chain through which Indian companies could choose a partner through a competitive and transparent process.”
Several steps have been taken in an effort to ease licensing, promoting exports and Foreign Direct Investment (FDI) in the Defence sector. In the last five years, FDI in Defence and Aerospace sector touched Rs 1,664 crore. And there has been a significant rise in defence exports touching Rs 10,745 crore in 2018-19 from Rs 4,682 crore in 2017-18.
Singh told the industry honchos that an end-to-end offset processing portal has been set up by the Ministry, and so far proposals of value $ 1.5 billion were processed. Also, entry barriers for MSMEs were reduced, resulting in a doubling of defence licenses issued from 215 in 2014 to 440 in 2019.
And added that besides the export procedure being simplified, defence procurement procedure was revised in 2016 which was done to encourage indigenous design, development and manufacture.
The minister called for steps to develop related technologies within the country as India has strong capabilities to develop such technologies where start-ups have a significant role to play.
The Ministry has also taken steps to rationalise the Standard Operating Procedure (SOP) in an effort to ensure that time taken for granting permission for exports is reduced by 100 per cent to 32 days now.
Also, the Ministry has revamped and re-launched ‘Make in India’ portal for Defence Production, and a new portal www.defenceexim.gov.in has been set up which will help in end-to-end processing and communication of export license applications and generating and disseminating the export market leads.
Last month, the MoD had launched a dashboard to keep track of the major components of Defence Production. Under this defence exports, offsets, projects under ‘Make in India’, start-ups, investments in defence corridors in Uttar Pradesh and Tamil Nadu and artificial intelligence projects in defence are being tracked.