Battle for Make in India Defence


Battle for Make in India Defence
Eminent defence data analyst Global Firepower Index says the Indian military has a combined 4,207,250 active and reserve personnel in service. Various defence groups rate India’s military as one of the top five biggest in the world. India is also the world’s largest importer of weapons and military equipment, accounting for 13% of all such international imports, according to the Sweden-based think-tank Stockholm International Peace Research Institute (SIPRI) in its report. Lined up before the country are the top defence manufacturers ever since the BJP came to power in 2014 and promised to open up the sector through ‘Make in India’ route. The objective is not only to generate thousands of jobs but also replace obsolete equipment and offer the best weapons and platforms to the defence forces. That has not been simple in the absence of adequate manufacturing ecosystem, veils of secrecy in a severe bureaucratic environment and dithering among some manufacturers to part with sensitive cutting-edge technology. Nevertheless, arms manufacturing companies see it as a golden chance. Sample this: Europe’s Airbus Group wants to sell its Panther helicopter. It says if it wins a contract, it would make India its global hub for the multi-purpose choppers. The company currently builds them at Marignane in France. Lockheed Martin says if its F-16 fighter jets are selected (it may compete with Saab for a $15 billion order) it will “support the advancement of Indian manufacturing expertise”. Germany’s ThyssenKrupp Marine Systems and France’s Naval Group want to vie for a contract of up to $10 billion to build submarines in a South Asian country. It is clear India imports at least 90% of its defence equipment. It is banking on foreign companies to bring in new technology. The lowest bid is one key selection factor that worries some of the competitors. “We’d like to see the Indian government work with the US government to ensure that these acquisition policies don’t disadvantage US firms just because we can’t get the lowest price,” Cara Abercrombie, former US deputy assistant secretary of defence for southeast Asia, told a panel in New York. The procurement model India’s attempt to join the nations producing world-class military equipment hinges on a new policy: ‘strategic partnership (SP) model’. Production of four crucial military items fighter jets (both for the Navy and IAF), submarines, helicopters (for all three services) and new-generation tanks are listed under this model, all cutting-edge equipment needed in a battle.The ‘SP model’ allows the Ministry of Defence (MoD) to select an Indian private company to collaborate with a foreign partner and produce military equipment in India. On paper, it looks fine, but technology transfer is tricky.In May last year — ending almost two years of discussions with industry and experts — the Modi government cleared the SP model. It was made a part of defence procurement procedure (DPP), the guiding framework of making military equipment in India
hy should MoD select and nominate an Indian partner for foreign companies some of whom are in the Fortune 500 list? It is a question often asked in industry circles. For the Indian companies, this clause could create a monopoly. The ideal situation should be to allow a foreign company to select its own partner from a bunch of Indian companies cleared by the MoD. It has seen some success and also failures. The Rs-32,000 crore ‘Make in India’ project to build 12 advanced minesweepers for the Navy with a South Korean firm was cancelled in January this year. An artillery programme for specialized artillery guns, the K-9 Vajra, has moved forward. The plan to include new rifles for the Army has been on the drawing board for long. Several rounds of talks later, 72,400 rifles have been cleared and the remaining 6.5 lakh will be purchased from eligible Indian vendors in tie-up with foreign manufacturer. Bullet-proof jackets are being made in India
The SP-model can help in building a military industrial complex and a failure could leave India still struggling with technology.

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