56 Defence Licences Granted to Pvt. Cos.- Make in India Gets A Big Push

NEW DELHI - July 16, 2015 - PRLog -- According to an item published in the latest issue of Indian Military Review the Narendra Modi government has awarded a record 56 defence manufacturing permits to private sector entities in the past year, underlining its determination to have indigenous defence production as a cornerstone of its ‘Make in India’ drive,

Giving details, the new issue of Indian Military Review, published from New Delhi sais according to the data released by the Department of Industrial Policy and Promotion (DIPP), a slew of applications, some of which had been pending for more than four years, have been cleared since the Bhartiya Janata Party (BJP) government came to power. This is more than 47 licences given by United Progressive Alliance (UPA) government in the last three years.

The permits are the first step in the process to enable firms such as Mahindra, Tata and Pipavav to set up production units for major military equipment.

The Tatas will now be able to upgrade major fighting units like the T-90 and T-72 tanks of the Indian Army while Mahindra has been given permits in a number of areas, including manufacturing naval systems like torpedoes, sea mines and boats.

Subsidiary companies like Mahindra Telephonics Integrated Systems and Tech Mahindra Ltd too have got defence permits.

The move stands as a major endorsement of the Indian private sector’s ability to operate in an arena that has until now been the preserve of foreign vendors and state-run entities.

Besides the established players, a number of new small firms are poised to enter the sector based on these clearances. For example, Bullet Proof equipment manufacturer MKU will now be able to manufacture night vision devices while Bangalore-based Dynamatic Technologies has been granted a permit to manufacture Unmanned Aerial Vehicles.

Pipavav Defence and Offshore Engineering Company (PDOC), now being acquired by the Anil Ambani-run Reliance, has grabbed four permits to manufacture items ranging from medium tanks and howitzers to missiles, sensors and torpedoes.

In order to open up the defense sector, the government has started expediting clearances besides increasing the foreign investment limit for the defence sector to 49% and even up to 100% in select cases.

The process for application online and the validity of the industrial licence has been enhanced to seven years and speedy DIPP clearances are already being given for smaller items like components.

Since taking charge in May last year, the government has increased the foreign investment limit for the defence sector to 49% and even up to 100% in select cases.

The government has planned to spend Rs 6 lakh Crore ($100 billion) to raise defence procurement over the span of next 10 years. India is at present spending around $40 billion on defence annually, of which 40 per cent is spent on buying new equipment and products.

Make in India Initiative

Make in India is an initiative of Government of India to encourage companies for manufacturing their products in India. It is focused on “zero defect manufacturing” strategy. It was inaugurated by Prime Minister of India -Mr Narendra Modi on 25 September 2014. The objective of this initiative is to focus on 25 key growth sectors of the economy for job creation and skill enhancement. Some of these sectors are: aviation, leather, tourism, hospitality, automobiles, chemicals, IT, pharmaceuticals, textiles, ports, railways, auto components, renewable energy, mining, bio-technology, and electronics.

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