Q. How critical is ‘Make in India’ for India’s defence establishment?
‘Make in India’ is critical for all sectors, but more so for defence as it is related to the security of the country. I believe that unless you have a substantial component of manufacturing and supplies within the country, you cannot really be self sufficient in defence. We spend a huge amount of money on defence purchases and for this spending to be really effective, our reliance on the Indian industry has to increase to 70 to 80 percent. That is our ultimate goal. Currently, we import as much as 60 to 70 percent of our needs.
Q. Does the country have the necessary ecosystem to succeed in defence manufacturing?
If we can send a rocket to the moon and Mars, we can make anything. Capability-wise there is no problem.
Q. Defence procurement has been very inconsistent in the past. Will that come in the way?
In civil procurement, competitiveness means fairness. If there are more than two people, there is transparency. This may not be the case really. There can be a dozen people but the requirements can be tweaked in a manner by which only one or two people will have the real opportunity to participate in the tender. Otherwise corruption will not be there. What is important is that the process has to be justified and equitably available to everyone. A single vendor situation can also result in a good deal if the right process is followed. Defence procurement is a strategic procurement that requires, while being transparent, decisions that are different from what are typically taken in civil applications. Decision-making has to be faster and conclusive. We are ensuring there are no inconsistencies here like in the past.
Q. Will restricting foreign direct investment (FDI) to 49 percent come in the way of ‘Make in India’ in this sector?
I don’t think so. We have said that when it comes to cutting-edge technology, there is always the possibility of allowing higher FDI on a case-to-case basis.
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(This story appears in the 27 November, 2015 issue of Forbes India. To visit our Archives, click here.)
We got a Defence Minister giving good signals for defence production. Stop illegal overtime and piece work system in Indian Ordnance factories. Worker unions become indiscipline needs all India transfer to all union leaders.
on Nov 20, 201560% indiginisation in 5 years would be really good, provided they achieve it. It can be made to 70-80% by 2025.
on Nov 20, 201560% indiginisation in 5 years would be really good, provided they achieve it. It can be made to 70-80% by 2025.
on Nov 20, 2015