How difficult it is for India to become self-reliant in defense sector?

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The central government has raised the new slogan of self-reliant India in the defense sector. For this, the Ministry of Defense has banned the import of 101 items.

This list includes artillery guns, assault rifles, transport aircraft, radars and other items. Announcing this, India’s Defense Minister Rajnath Singh said that this ban will be implemented in a phased manner between December 2020 to December 2025. According to the Ministry of Defense, this decision will promote indigenization in the matter of defense production.

The Defense Minister said that the list of these items has been prepared by the Defense Ministry after consulting all the concerned parties. It also includes military, private and public sector industries to assess the capability of preparing war equipment in the present and future.

India’s defense spending

Recently the annual report of Stockholm International Peace Research Institute (SIPRI) has also appeared. According to this report, India is the third largest country in the world spending the most in the military sector. America is at number one in this list and China at number two.

According to Sipri’s report, India spent $ 71 billion in the defense sector in 2019, which is 6.9 percent more than in 2018.

In 2019, China spent 261 billion dollars in defense, and the US spent 732 billion dollars. So far, India does the most shopping of military products from Russia. After that comes the number of America, Israel and France.

According to Sipri’s report, India’s defense spending has also increased because the situation on the borders with Pakistan and China is tense.

But will this picture change in the next five years after the new announcement by the Ministry of Defense. Will India’s dream of becoming self-reliant in the defense sector be fulfilled in the next five years? The experts of defense deals in the country have a different opinion on this.

How self-dependent is the defense sector at present

Defense expert Rahul Bedi says that there is nothing new in Rajnath Singh’s statement. This is the account of the old wine in the old bottle.

In 2013, the same thing was said in the Defense Procurement Procedure. According to Rahul Bedi, many of the parts of the defense equipment that are being manufactured in India are made from abroad. Many devices which are being manufactured in India are prepared here on license basis.

Being made on license basis means that the license to manufacture military equipment is with the foreign company, and that foreign company has signed an agreement with India, due to which they are able to make these products in India.

There is no clear reference in the new order of the Ministry of Defense whether the equipment made on the basis of license will also be considered as self-dependent or not.

Rahul Bedi says that as long as foreign companies interfere in defense deals to such an extent, the slogan of self-reliance in defense equipment cannot succeed. Rahul explains his point by example.

Light combat aircraft

Light Combat Aircraft Engine and many other parts are imported from India abroad and then manufactured here. Will the new slogan of ‘self reliance’ in defense equipment mean that the engine will start being built in India? Or will the engine be considered an Indian light combat aircraft even if it is foreign? Its clarity is not in the order of the Government of India.

Light Combat Aircraft began to be built in India around 1983. In 37 years, we have been able to make his basic model in India, which is Mark 1. The Mark 1A will be its fighter model, whose proto type has not yet been developed in India. It will take four to five years to be made. This is believed by Rahul Bedi.

Among the 101 items on which import restrictions have been imposed by the Ministry of Defense are Light Combat Aircraft, in which there is talk of indigenization.

This means that if 50 per cent of the goods for making this aircraft are taken from abroad, then in the coming days there will be an effort to reduce it and make things in India. The engine in this aircraft is outside, the weapons are outside.

A similar story is also about the Light Combat helicopter. His engine comes from France. And in Hindustan Aeronautics Ltd. it is assembled with other components.

Bullet proof jacket

Rahul Bedi says that in order to be self-reliant in the defense sector, India will also need to focus on design and development.

Rahul gives the example of bullet proof jacket as another example. According to him, there was an attempt to make it in India from the 1990s.

It is currently made in a private company in Kanpur, Uttar Pradesh. But one thing is used to make this jacket, which is called ‘kevlar’, it is still being sourced from abroad.

Its production has started in the country two years ago, but still not so much in the country that we can call India self-reliant in a bullet proof jacket.

Rifle

India also tried to make assault rifle. Rahul Bedi says that India made an indigenous assault rifle in the 1990s. Which is called INSAS rifle.

But that did not happen. In 2010-2011, the army had said that it is not operationally efficient, that means there are many problems in running it. The army rejected the INSAS rifle as saying. They said That we need a second rifle instead. Since then, the talk about the new rifle has been going on for 8-9 years.

Then in 2019 in Amethi, Uttar Pradesh, a factory for making assault rifles started. It talks of a partnership with Russia. Prime Minister Narendra Modi himself went to inaugurate it. This is also a license based agreement. But still the agreement with Russia is not complete, due to which the work is stuck.

Due to the corona in the middle, it also encountered some problems. In fact, there are many obstacles in the path of self-reliance in the defense sector.

Why private companies lag behind in the defense sector?

In India, till 2001, the defense sector was dominated by government companies such as DRDO and Ordnance Factory. After 2001, the government approved the participation of private companies.

But even today their share in defense deals has not increased more than 8-10%. There are some private companies like L&T, Mahindra, Bharat Forge, which are coming forward in the defense.

There are only a few names in the big government companies in the defense sector, such as Hindustan Aeronautics Limited, Bharat Electronics Limited. Bharat Dynamics, BEML.

It is clear that this situation has not improved much in the last 20 years. But why is this so? Why do Indian companies hesitate to invest in the defense sector?

The BBC spoke to Avnish Patnaik to know this. Avnish is a member of the Society of Indian Defense Manufacturers. This institution is associated with the Confederation of Indian Industry.

According to Avnish, “Defense is a sector in which it takes a lot of time to get returns on investing capital. The other problem is that small budget cannot be started in this sector. It also requires more investment. And third. The problem is that after the investment in this sector in India, returns were still not guaranteed. The reason was that outside company used to make better equipment than us at any given time. That is why we were left behind by them in the competition. Defense abroad The companies whose name is credible, they have been engaged in this work for 70-80 years. Indian companies are nowhere in their competition. And fourth is the problem, the demand for these products is very less in the market, and These devices do not degrade quickly and are not replaced. “

Avneesh feels that now the new decision of the government will give investors this encouragement. The central government has said that in the next five-seven years, defense equipment worth about 52 thousand crores will be purchased from Indian companies only. Therefore companies will definitely come forward to invest and invest. They believe so.

World class defense products

But will India’s products become world class?

Ghazala Wahab is the executive editor of Force magazine. ‘Force’ is a monthly magazine on defense matters. Speaking to the BBC, Ghazala says, “Many defense equipment licenses have been in production in India for many years. But their research and design are also in India, the central government has to ensure this to become self-sufficient in the field of defense. That will be the biggest challenge. “

“The ability of anything is tested only by who is buying it. If I make something and my family buys, then there is nothing big about it. Those people are members of my family. But if I market my things I am able to sell it, it is a worthwhile thing. The same thing applies to defense equipment made in India. If India is able to manufacture whatever defense equipment it can export, it will have to be seen. This is the biggest The test will be how much outside countries are showing interest in our product or are buying. “

Ghazala describes the Arjun tank prepared in India as an example. The Indian Army did not want to take the tank because of its weight. But the Indian Army finally bought it. The same happened with Tejas. The Indian Air Force has bought Tejas, but the Air Force has said that they will wait for its advanced version.

How long it took to become Tejas, this thing is not hidden from anyone and they are not being used anywhere in foreign countries.

She further says that at present, no such defense related thing is made in India, which is being fully prepared here. It is important that India is a part of the supply chain of big defense companies.

For example, the Boeing company is foreign, but many of its parts are made in India, which sells India abroad. Then it is assembled in those countries. India’s defense equipment export list is similar.

Rahul Bedi gives two examples of similar demands made in India in other countries of the world. It was in 2009-12, when India sold 8 ‘Dhruv’ helicopters to Ecuador. Four of them crashed. And they returned the remaining four. The contract was canceled. In the same way, INSAS happened to the rifle, which India had given to neighboring Nepal.

This makes it clear that companies in defense sector need to create a separate credit, in which companies have to spend both time and money. This path is not so easy.

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