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GROWING DEFENCE EXPORT

The Indian defence export's graph has started mounting year-on-year. On one hand it is good for the country's foreign reserves; on the other hand it will surely benefit manufacturers as requirements of the Indian Armed Forces alone are unlikely to provide the economy of scale. Moreover, the imports have started falling slightly, but in the long-run will definitely make a big impact.

The Government of India launched the Make in India campaign in 2014 with the objective to boost manufacturing and generate employment by focusing on 25 sectors, including defence. Going by demonstrated performance it seems, the rhetoric on the "Make in India" policy with greater private sector participation in the defence production sector will take several years if at all to materialize on the ground. The objectives for the defence sector and mean and measures adopted for promoting self-reliance, indigenization, achieving economies of scale, developing capabilities for export, transfer of technology and domestic research and development have yet to show results. It will need sweeping systemic reforms to revive the country's Department of Defence production and DIB from its prolonged stupor. The defence ministry is now working to streamline the complicated indigenous defence production policy. There is an attempt, for instance, to revive the provision for the government to fund 80% of the development cost of a weapon prototype, with the industry chipping in with 20%, in "high-risk projects".

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