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New DPP to promote indigenisation

 
 
  Published :February 2010
 
 
 
 
     

New Delhi. India’s defence procurement policy is being finetuned to reduce imports and promote the indigenization in the defence production sector, director general (acquisition) Shashi Kant Sharma said here Tuesday.

 

The changes attuned to value addition, focus on critical technologies, a conducive taxation regime and strengthening of the R&D base are expected to be unveiled by September this year, Sharma said while inaugurating the Defexpo India 2010 Seminar on ‘Defence Procurement- Movement from Offsets to Buy and Make Indian’ organised by defence ministry and FICCI.

“DPP was not an end in itself but a vehicle to meet the larger goal of security of the nation,” said Sharma.

He said that if India was to have a say in the global milieu, it needed to have a vibrant defence industry.

In this context, Sharma said that there was a need for greater involvement of the private sector in defence production and its absorptive capabilities would have to match the technologies available worldwide.

The recent introduction of “Buy and Make (Indian)” category in the defence acquisition process has been designed to enhance participation by the Indian industry, meeting our requirements for state of the art defence systems and platforms by getting into tie ups with technology providers through mechanism of technology transfers in joint ventures. This is a major step which has been taken by the Government as a result of the review of Defence Procurement Procedures. In capital acquisition cases categorised as “Buy and Make (Indian)”, the Request for Proposal will be issued to those Indian industries that have requisite financial and technical capabilities to enter into Joint Ventures, as also absorb technology and undertake indigenous manufacture.

The procedure to be followed in this regard will be akin to the existing “Make” procedure with a difference that the production and development by the Indian industry will be through Transfer of Technology and not through Research and Development. This provided companies an opportunity to pursue tie ups and joint ventures as “Buy Indian”; “Buy and Make Indian”; and “Make” will be the preferred categories with option of “Buy Global” being resorted to only where equipment with requisite Qualitative Requirements are not possible to be procured through these methods in the required time frame.

In the context of the ongoing modernisaiton of the armed forces and the acquisition reforms undertaken by the government, the Indian defence market now offers tremendous opportunities for formation of joint ventures and direct sourcing by the global players. India needs highly sophisticated and technologically advanced products to meet the requirements of the armed forces. The government was also looking for collaborations in the field of defence R&D and tie-ups in critical technology areas in order to meet the requirements of the armed forces through indigenous sources to the extent possible.

 
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