The Make in India programme is yet to make a big impact in the defence sector. “There are a lot of projects that are in the process of being finalised…. But there isn’t any new, big-ticket Make in India project in the defence sector that we can see on ground,” Lt Gen Narendra Singh, former deputy chief of the Army, told THE WEEK.
In the past two years, the government has been liberal in granting licences to make defence equipment ranging from night-vision goggles to submarines and aircraft engines. As many as 319 licences have been given to 190 companies since 2001. Of these, 50 companies with 79 licences have already started production.
Some Indian companies have responded to almost all tenders floated by the defence ministry, sometimes even without capability. Anil Ambani’s Reliance Defence Ltd has bagged licences in almost all defence-related manufacturing fields, though the company does not have a track record that can generate trust in its ability to deliver on time.
The ministry is now looking into the financial health of the company and this has delayed important deals. Projects on hold include the Rs 20,000-crore contract for building four aircraft carrier-like landing platform docks and the Rs 15,000-crore deal for building shallow water crafts for anti-submarine warfare.
There are also companies that have been working in the sector for a long time, but want to build their capabilities before moving on to bigger projects. Adi Godrej, chairman of Godrej Group, which has contributed to the BrahMos cruise missile development, said his company did not want to get into each and every project on offer. “We are developing core competencies,” he said. “It will take some time for us to be in a position where we would be able to produce anything big like a helicopter.”
Tata and L&T have developed significant capabilities in terms of manufacturing facilities. They are taking up big projects such as the construction of 62 transport aircraft to replace the ageing Avro aircraft fleet of the Air Force. Said defence industry expert Deba R. Mohanty: “Tata and L&T, along with a few other Indian firms, have really come a long way in terms of capability of manufacturing big systems or working with foreign vendors in producing a big system.”
