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EDITORIAL JUL-AUG 2018

As India looks to build indigenous defence industrial capability in aerospace and defence (A&D) sector, a focus market for many global A&D companies with offers for collaboration. The market is equally attractive for domestic industrial product conglomerates aspiring to achieve non-linear growth via positions across the A&D value chain across platforms. This  encouraging development is the shifting dynamics of the sector,  where in   the  monopoly of the state-owned  entities is under serious competitive threat from resurging  number of private entities working towards acquiring a range of manufacturing capabilities and technological expertise.

Recent projected requirement of Fighter Aircraft is one example. There is enormous potential for collaboration and creation of joint ventures in this sector for establishing production of avionics, components and accessories,  maintenance, repair, overhaul facilities for civil and military aircrafts.In present geo political environment the dictates fromdominating  alignments or  powers, who  consider themselves as the custodians in the world affairs,in  no case to over ride out national interest in procurement or selection of partner for creating indigenous capabilities.

In recent past number of draft policy proposals, initiatives  have been floated such as draft Defence Production Policy 2018, draft offset Guidelines , List of identified Local Content ( amended) and Defence Products list, Defence Corridors etc. Fact of the matter is that other than the hype no tangible effort has been made in last 15 years to increase indigenous contribution in defence products. For development of indigenous industrial base competitive environment is essential. It is time for serious introspection within the MOD in national interest need of the hour is to insist on measures to ensure probity, responsibilities and accountabilities.

Govt sector design development and production set up has failed to providemajor defence system on time and with cost effectiveness, because they don't work in competitive environment and struggle for orders. In case "Make in India" is to  boost manufacturing in defence products as one of the pillar of country economic development the level playing field is pre -requisite.The ability of the government to navigate through the Indian business environment, to reduce the time taken for defence procurement right from the initial clearance to placing the order on competitive basis will decide the direction, in case it really wishes to remove policy paralysis.Public-private partnership (PPP) is a time tested concept of using the Government’s capacity to absorb risk and bringing in private sector investments and dynamism to reach a stated goal.

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