Govt should set-up R&D, testing centres to boost MSMEs supply to defence, says Chamber

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Published: August 21, 2019 7:24:31 PM

Defence minister Rajnath Singh said that comprehensive outsourcing and vendor development guidelines for DPSUs and OFB to promote the participation of private sector, particularly MSMEs in defence production.

Defence industry, FDI in defence, Commerce and Industry Minister, Piyush Goyal, Lok Sabha, FDI inflows, defence newsThe Technology Development Fund (TDF) Scheme was set-up to promote self-reliance in defence technology under the Make in India programme. (Representational iamge: Reuters)

The government should set-up four-10 centres for research, development (R&D) and testing for MSMEs in defence sector because if given proper support to them, the sector’s 90 per cent supply can be contributed by MSMEs instead of relying of foreign manufacturers, according to national chamber for MSMEs in India — SME Chamber of India. “SMEs making let’s say rifles, revolvers, or night vision binoculars are finding it difficult to test products due to lack of R&D and testing centres in India. There must be four-10 such centres set-up,” Chamber’s Founder and President Chandrakant Salunkhe told Financial Express Online.

The chamber’s comments come a day after Defence Minister Rajnath Singh called for increased participation of India’s private sector in Make in India in the defence sector. With respect to MSMEs, the minister said that comprehensive outsourcing and vendor development guidelines for Defence Public Sector Undertakings (DPSUs) and Ordnance Factory Board (OFB) to promote the participation of private sector, particularly MSMEs in defence production.

The minister also allowed private businesses to use test facilities of government entities “to meet the best quality standards required for defence manufacturing,” he said in a statement on Tuesday. “MSMEs have quality technology development set-up but they are struggling to get business from the government. The government is not giving due importance to defence MSMEs. They are looking at top companies from abroad or in India like Bharat Forge or Reliance,” said Salunkhe.

The Technology Development Fund (TDF) Scheme, which was set-up to promote self-reliance in defence technology under the Make in India programme, “will encourage the participation of public/private industries especially MSMEs,” Rajnath Singh said even as the chamber claimed that MSMEs are not keen to supply to the government because of undue rejection. “Even after the tender is, it is withdrawn without notice and rejected without notice. If the government wants to improve MSMEs’ capability then it should provide a level playing field, handhold MSMEs under Make in India,” said Salunkhe.

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