Defending the World

As India gears up to spend USD 130 billion on military modernization in the next 5 years, achieving self- reliance in defence production is a key target for the Government of India. The focus on indigenous manufacturing has opened up the defence industry for private sector participation and is paving the way for foreign original equipment manufacturers to enter into strategic partnerships with Indian companies.

With a view to facilitating DPSUs and private defence industry in exploring business opportunities abroad, a Defence Export Strategy has been formulated. Approximately, USD 317 million Made-in-India defence platforms, equipment and spares were exported to over 28 countries in the world between 2015-16.

100% FDI in defence sector: Up to 49% under automatic route; FDI above 49%, through Government route.

A 5.3% increase was recorded in defence budget 2017-18 compared to 2016-17.
The allocation for defence in budget in 2017-18 is nearly USD 41 bn with USD 13.3 billion allocation for capital expenditure equivalent to 31.7% of the total budget.
India contributes 3.3% of global military expenditure (2016)
Service /Department-wise Allocation as percentage to Total Defence Estimates 2017-18 (BE): :
Army: 55.9%
Navy: 14.6%
Air force: 22.5%
DGOF (Directorate General of Ordnance Factories): 0.8%
DGQA (Director General of Quality Assurance): 0.5%
R&D: 5.7%


Defence Procurement Procedure 2016

The Defence Procurement Procedure (DPP) is not merely a procurement procedure- it is also an opportunity to improve efficiency of the procurement process, usher change in the mind-sets of the stake holders and promote growth of the domestic defence industry. However, these opportunities are not natural outcomes of merely publishing the DPP and are highly dependent on the manner in which the DPP is implemented. In that sense, DPP should be amply supported by an eco-system of result orientation, commitment to time-lines, iterative learning and continuous improvement- involving the active ownership of all stakeholders concerned. Hence the Ministry of Defence (MoD) is determined to treat DPP 2016 as a dynamic and an evolving document and is committed to making improvements based on emerging data and anecdotal evidence, to realize the vision of “Make in India‟ in the defence sector.

Defence Offset Guideline

The key objective of the Defence Offset Policy is to leverage capital acquisitions to develop Indian defence industry by (i) fostering development of internationally competitive enterprises, (ii) augmenting capacity for Research, Design and Development related to defence products and services and (iii) encouraging development of synergistic sectors like civil aerospace, and internal security.

Procedures For The Grant of Industrial Licenses Have Been Streamlined

Streamlining the Procedure for Grant of Industrial Licenses

i) Increasing the validity period of Industrial License
ii) Removal of stipulation of annual capacity in the Industrial License.
iii) Sale of Defence items to Government entities without approval of Ministry of Defence

Recent Investments

October 2017 – Eric Trappier, Chairman of Dassault Aviation and Anil D. Ambani, Chairman of the Reliance Group laid the Foundation Stone for the Dassault Reliance Aerospace Limited manufacturing facility in Mihan, Nagpur located in India’s western state of Maharashtra.

April 2017 – TATA Safari STORME’s into the Indian Army with the initial order for 3192 units

March 2017 – Airbus is setting up a greenfield training facility at Aerocity, New Delhi, to support India’s growing need for Airbus aircraft pilots and maintenance

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