Atma Nirbhar in Defence Production | 11 Oct 2022

The Defence Sector in India is identified as an important area with an ocean of opportunities for self-reliance. With large-scale modernisation requirements of the Indian Armed Forces, India’s vision for Atma Nirbhar Bharat has provided further impetus to realise the goal of indigenisation of Defence Sector.

According to a study released by the Stockholm International Peace Research Institute (SIPRI), India ranks 4^th among 12 Indo-Pacific nations in self-reliant arms production capabilities. But the concern is, India is also ranked as the 2^nd largest importer of arms for its armed forces in 2016-20.

In spite of significant efforts to become self-sufficient in defence production, the indigenous texture still lacks its flavour due to higher import bills and it needs to be addressed.

What is Indigenisation of Defence?

• Defence Indigenization is the process of developing and manufacturing defence equipment within a country as a way to reduce import dependency as well as achieve self-reliance.
  • Defence Research Development Organisation (DRDO), Defence Public Sector Undertakings (DPSUs) are the major front runners in Atma Nirbhar Bharat vision.
• 1983 is marked a significant milestone in defence indigenization as the government approved the Integrated Guided Missile Development Program to develop 5 missile systems:
  • Prithvi (surface-to-surface)
  • Akash (surface-to-air)
  • Trishul (the naval version of Prithvi)
  • Nag (anti-tank)
  • Agni Ballistic Missiles

What are the Challenges Related to the Defence Sector in India?

• High Dependence on Imports: The defence sector in India relies heavily on imports, and changing geopolitical circumstances cause it to be delayed. For instance, amid the Russia-Ukraine war, India is awaiting the delivery of the S-400 Air Defence Systems under a deal signed in 2018.
  • In addition, several new deals are in line including 12 Sukhoi-30MKI aircraft and 21 MiG-29 fighter jets for the Indian Air Force.
• Narrow Private Participation: Private sector participation in the defence sector is constrained by the lack of a conducive financial framework, that means our defence production is unable to benefit from modern design, innovation, and product development.
• Lack of Critical Technology: Lack of design capability, inadequate R&D investment, inability to manufacture major subsystems and components hamper indigenous manufacturing.
  • Also, the relationship between R&D institutions, production agencies (public or private) and end-users is extremely fragile.
• Lack of Nexus Between Stakeholders: India's defence manufacturing capability is hindered by overlapping jurisdictions between the Ministry of Defence and the Ministry of Industrial Promotion.

What Should be the Way Forward?

• Indigenisation with Private Boom: There is a need to revitalise and regulate entry points for Private sector to enter in defence production embracing sustainable design and development to meet the needs of Indian Armed Forces in coming years.
• Defence Industrial Corridors (DICs): It is necessary to extend dedicated defence industrial corridors across the length and breadth of the country in order to harness and channel the potential of Indian MSMEs and DPSUs in the defence manufacturing sector, as well as to facilitate the smooth transit of raw materials.
  • Government’s initiative to establish two Defence Industrial Corridors (DICs) in Uttar Pradesh and Tamil Nadu is a welcome step in this direction.
• Defence Investor Cell: It is necessary to strengthen investment in defence by providing entrepreneurs/industry with a single point of contact to deal with all defence production-related queries, procedures and regulatory requirements for investment in the sector.
  • The SRIJAN portal can be linked with Investment Cell.
• Inclusion of Defence Entrepreneurs in Policy Making: Through streamlining procurement and shaking hands with newer defence entrepreneurs for better policy making and implementation, can reduce the qualitative and quantitative gaps in its defence sector.
• Tapping the World’s Defence Market: There is also a need to give adequate attention to the promotion of exports of Indian Defence products.
  • It is important to simplify and streamline export authorisation procedures through an online mechanism and targeted outreach efforts.
  • Defence Exim Portal is a welcome step in this direction.
• Strengthening Economy with Strategic Independence: Indigenised India’s defence sector would further strengthen the economy by generating employment opportunities and saving the exchequer by reducing the import burden.
  • Also, Self-sufficiency in defence will fundamentally lead to India’s strategic independence.