4th Positive Indigenisation List

• 16 May 2023

For Prelims: Defence Public Sector Undertakings (DPSUs), Positive Indigenisation List (PIL), Micro, Small, and Medium Enterprises (MSMEs), Mission DefSpace, iDEX scheme, Defense Industrial Corridors, NETRA

For Mains: Status of Indigenization of the Defence Sector in India.

Why in News?

In a significant move towards promoting self-reliance in the defence sector and reducing imports, India's Defence Public Sector Undertakings (DPSUs) have received approval for the fourth Positive Indigenisation List (PIL).

• The list comprises 928 strategically-important Line Replacement Units (LRUs), sub-systems, spares, and components, with an import substitution value of approximately Rs 715 crore.

What is a Positive Indigenisation List?

• About:
  • The concept of the positive indigenization list entails that the Indian Armed Forces, comprising the Army, Navy, and Air Force, will exclusively source the listed items from domestic manufacturers.
    • These manufacturers may include entities from the private sector or Defense Public Sector Undertakings (DPSUs).
  • The fourth Positive Indigenisation List follows three previous PILs that were published in December 2021, March 2022, and August 2022, respectively.
    • So far, 310 items have been successfully indigenised, with the breakdown as follows: 262 items from the first PIL, 11 items from the second PIL, and 37 items from the third PIL.
    • This initiative is in line with India's vision of 'Atma Nirbharta' (self-reliance) and aims to boost the domestic defence industry, enhance investment, and reduce dependency on imports.
• Indigenisation and In-house Development:
  • To achieve indigenization, the DPSUs will utilize different routes under the 'Make' category, focusing on in-house development through the capabilities of Micro, Small, and Medium Enterprises (MSMEs) and the private Indian industry.
  • This approach will provide a boost to the economy, encourage investment in the defense sector. Additionally, this initiative will foster the growth of design capabilities within the domestic defense industry by actively involving academia and research institutions.
• Procurement and Industry Participation:
  • The DPSUs are set to initiate procurement action for the items listed in the fourth PIL. To facilitate the process, Srijan Portal Dashboard has been specifically designed for this purpose.

What is the Status of Indigenisation of the Defence Sector in India?

• Need for Indigenization:
  • India's arms imports fell 11% between 2013-17 and 2018-22, the country is still the world’s top importer of military hardware in 2022 highlighted by a report by the Stockholm International Peace Research Institute (SIPRI).
• Current Estimates and Targets:
  • Current estimates place India's defensive capital expenditure at USD 130 billion over the next five years.
  • The defense ministry has set a USD 25 billion (Rs 1.75 lakh crore) turnover goal in defense manufacturing in the next five years, including an export target of USD 5 billion worth of military hardware.
• Government Initiatives:
  • Priority Procurement: The Defense Acquisition Procedure (DAP)-2020 gives priority to the procurement of capital items from domestic sources under the Buy Indian (IDDM) category.
  • Liberalised Foreign Direct Investment (FDI) Policy: The FDI policy allows for 74% FDI under the automatic route in the defense industry, and up to 100% through Government route wherever it is likely to result in access to modern technology.
  • Mission DefSpace: The Mission DefSpace has been launched to promote defense-related innovations and developments in the space sector.
  • Innovations for Defense Excellence (iDEX) Scheme: The iDEX scheme involves startups and MSMEs in defense innovation projects, fostering their participation and contribution.
  • Defense Industrial Corridors: Two Defense Industrial Corridors have been established in Uttar Pradesh and Tamil Nadu, focusing on developing defense manufacturing ecosystems and attracting investments.
• Examples of Indigenous Defense Arsenal in India:
  • Tejas Aircraft: The Tejas is a lightweight, multi-role supersonic aircraft designed and developed indigenously in India.
  • Arjun Tank: Developed by the Defense Research and Development Organization (DRDO), the Arjun Tank is a 3rd generation main battle tank that showcases India's expertise in armored vehicle technology.
  • NETRA: The NETRA is an airborne early warning and control system developed domestically, providing crucial surveillance and reconnaissance capabilities.
  • ASTRA: India has successfully developed the ASTRA, an all-weather beyond-visual-range air-to-air missile, enhancing the country's air defense capabilities.
  • LCH ‘Prachand’: It is the first indigenous Multi-Role Combat Helicopter which has potent ground attack and aerial combat capability.
  • ICG ALH Squadrons: In a major boost to further strengthen the capabilities of the Indian Coast Guard, ALH Mk-III squadrons were commissioned in Porbandar and Chennai in June and December 2022.
• Challenges:
  • Technological Gap: Developing cutting-edge defence technologies and acquiring advanced capabilities is a significant challenge for India.
    • The country has traditionally relied on foreign suppliers for critical defence technologies, and bridging the technological gap requires substantial investments in research and development (R&D), as well as collaboration with industry and academia.
  • Infrastructure and Manufacturing Base: Building a robust defence industrial base and infrastructure to support indigenous production is a major challenge.
    • The defense manufacturing ecosystem in India needs to be modernized, with improvements in infrastructure, technology transfer, skilled workforce development, and streamlined procurement processes.
  • Testing and Certification: Ensuring the quality, reliability, and safety of indigenously developed defense systems through rigorous testing and certification processes is crucial.
    • Developing robust testing facilities and establishing effective quality control mechanisms are essential for gaining the confidence of users and export markets.

Way Forward

• Create a Defense Innovation Ecosystem: There is a need to establish a dedicated defense innovation ecosystem that brings together defense organizations, research institutions, startups, and technology companies.
  • This ecosystem should promote collaboration, knowledge sharing, and technology transfer to drive indigenous defense capabilities.
• Defense Technology Accelerators: Establish defense technology accelerators that provide mentorship, funding, and resources to startups and small and medium-sized enterprises (SMEs) working on cutting-edge defense technologies.
  • These accelerators should facilitate connections with defense organizations, offer access to test facilities, and help navigate regulatory processes.
• Defence Skilling and Training Programs: There is a need to develop skilling and training programs to bridge the gap between academia and industry in defense-related disciplines.
  • Collaborating with universities and technical institutes to design specialized courses and certifications that align with defense technology requirements will be a significant step in this direction.

UPSC Civil Services Examination, Previous Year Question (PYQ)

Prelims

Q. In the context of the Indian defense, what is ‘Dhruv’? (2008)

(a) Aircraft-carrying warship
(b) Missile-carrying submarine
(c) Advanced light helicopter
(d) Intercontinental ballistic missile

Ans: (c)

Mains

Q. What is the significance of Indo-US defence deals over Indo-Russian defence deals? Discuss with reference to stability in the Indo-Pacific region. (2020)

Q. How is S-400 air defence system technically superior to any othersystem presently available in the world? (2021)

Source: PIB