Even as the government of Prime Minister Narendra Modi is aiming to increase the foreign direct investment (FDI) cap for high-end technology in defence, the value of total indigenous production of defence equipment has gone up to Rs. 55,000 crore last year.
Declaring that the upcoming DefExpo-2018, for the first time, will be projecting India's defence manufacturing capabilities to the world, Secretary, Defence Production, Ajay Kumar said domestic production of defence equipment worth Rs. 55,000 crore happened last year.
"India is emerging as a major defence manufacturing hub. DefExpo-2018 will help India as an exporter of defence systems and components," Kumar said, on the occasion of a curtain-raiser briefing on the upcoming DefExpo-2018, which will be organised from April 11-14 near Chennai.
The claims by the ministry of defence came in the backdrop of a SIPRI report on March 12 that reconfirmed India—yet again—emerged as the biggest importer of weapons in the world, with around 70 per cent of defence imports. Moreover, only last month, the Indian Army flagged before a Parliamentary panel the issue that 68 per cent of its weaponry is of the 'vintage' category.
Interestingly, Secretary Kumar simultaneously pitched for an increase in the FDI cap in the defence sector in the draft Defence Production Policy, 2018.
"We are considering an increase in the FDI cap to 74 per cent from the existing 49 per cent. But it will be only for the niche areas, where we have not been able to develop it (technology) and may not be able to develop in next couple of years. So, such niche technology should be made in India," Kumar said, adding it is only the draft policy and changes can be made in it.
As per the new DPP draft policy, India aims to be among the top five countries in aerospace and defence and plans to increase the value of domestic production nearly threefold to Rs 1.7 lakh crore by 2025. The key focus, according to the draft, will be on fighter aircraft, medium lift and utility helicopters, warships, land combat vehicles, autonomous weapon systems, missile systems, gun systems, small arms, ammunition and explosives, surveillance systems, electronic warfare systems, communication systems, night-fighting enablers and so forth.
Kumar also told the strategic partnership model of DPP is likely to be amended. Defence PSUs may be considered as Indian partners for tie-ups with foreign companies. Till now, this provision was only for Indian private companies.
Meanwhile, despite making tall claims over DefExpo-2018, the ministry of defence itself has accepted the number of exhibitors will be down by about 10 per cent from the last edition, held in Goa in 2016.
Kumar said 677 exhibitors, including 523 from India, had confirmed their participation in DefExpo-2018. The figure is far lower than the 1,055 Indian and foreign firms that took part in 2016.
With an aim to make DefExpo-2018 more attractive, an India Pavilion is being set up for the first time under the 'Make in India' theme. Besides, a first-ever combined live demonstration of naval, aero and land systems will take place in the Bay of Bengal. Moreover, to extend its outreach, the DefExpo inaugural ceremony would be webcast on social media platforms including Facebook, Twitter and Periscope.
Two major international collaboration events are also being planned on the sidelines of DefExpo: a joint commission with South Korea on April 9 in Delhi and a military-industry cooperation event with Russia on April 13 at the DefExpo venue.
Prime Minister Narendra Modi will be visiting Asia's biggest naval, aero and land systems exhibition on April 12. Though the defence minister will open the event on April 11, the ministry has planned a formal inauguration of the event on April 12 by the prime minister.
Meanwhile, the defence ministry has confirmed that China has not responded to India's invitation to participate in DefExpo.