Indian Defence Estates Service
Indian Defence Estates Service
From freedom, the goal of self-confidence
has encouraged India to grow and expand
the background of the defense industry. In 1947, most of them
defense infrastructure and equipment
India inherited from its ancient colonies
emperor, Britain. In the 1950s, India became embroiled in controversy
in its traditional production capacity
machines with little technical knowledge,
leaving the requirements for advanced equipment
to deal with the importation of goods. In 1956, the
Revised Industrial Policy Resolution reserved
arms and ammunition industry and society
sector. In 1958, ordnance factories were established
under British rule it became the core group of
industries that make up Defense Research as well
Development Organization
and foreign companies led to a standstill
Indian home skills for research,
development and production.
In the 1980’s, India launched a new effort
has promoted its domestic defense industry by
investing heavily in DRDO and development
of traditional archery systems such as
‘Prithvi’, ‘Akash’ and ‘nag’. India also began
development of its aeronautical flagship
project, Light Combat Aircraft at a time
this time. In 1998, India went to the polls
agreement with the Soviet Union to develop
supersonic cruise missile system, i
‘Brahmos’, collectively.
In the early 21st century, in India
opened their doors to release again
ongoing economic changes. Time for
State-owned enterprises are also listed in the center
the economy has taken a back seat and paved the way
with the arrival of private companies. Confidential
the sector was given full access to security
industry. Introducing the ‘Make’ type of
purchase of goods in Defense Procurement
The 2006 policy allowed the industry to develop again
produce advanced defense equipment, with
government commitment to provide 80%.
development costs.4 FDI 26% also
allowed in the defense sector. However, i
the government continued to rely on foreign imports
advanced weapons, with new combat aircraft
as a Sukhoi 30 MKI is imported into it
Air Force, submarines and destroyers of missiles
purchased for navy and Howitzers
as a purchased BOFORS program
of the army. In an effort to improve pets
procurement, the government changed
order of choice in the purchase of goods under
Development of the Defense Acquisition Policy 2013
it is a choice preferred to develop, design or
producing natural protective materials.
India has slowed down in achieving its goal of this
confidence in being one of the few nations
owning and developing such weapons
such as Inter-Continental Ballistic Arrows, Flight
Carriers and Nuclear Vessels. However,
has continued with the long-term goal of this
working together and gaining support
from technologically advanced nations for
its defensive capabilities.
The global defense industry provides
an interesting picture of the year 2016 again
Flexible speculation for 2017-2018. Five
major suppliers worldwide – United States
United States (USA), Russia, China, France and
Germany holds 74 percent of the country
volume of exports worldwide between 2011 and
2015.5 USA and Russia become the largest
security providers since 1950. The USA also has it
remains the largest nation to spend money on defense,
representing 34 percent of the global total
military spending of USD 1760 billion in 2015.
However, the defense budget in the USA testified
a five-year decline from 2011 to 2015, declining
from USD 691 billion to USD 560 billion. Ku
In 2017, this increased to USD 589 billion, however
for it is much lower than most of it
previous budget.6 At the district level,
arms sales in Europe dropped by 41%
between 2006-10 and 2011-15. However, most
interestingly, the flow of weapons to the Middle Ages
The East has grown by 61 percent, and in Asia
increased by 26%. Between 2011 and 2015, he says
in Asia received 48 percent of all imports
major weapons in 2011-15. Of the top five
recipients of large arms, three found
in Asia – namely India, China and Australia.
Indian Defence Estates Service
showing growth of more than seven percent
annually for three consecutive years
2014-15 and 2016-17. Growth momentum
it is likely to be kept at around 6.75-7.5
percent in 2017-18, as recently reported
Economic Survey. Apart from GDP growth,
the economy has also experienced some strong macroeconomic indicators related to inflation, finance.
consolidation, current account deficit, rupeedollar exchange rate, foreign exchange locations
and foreign investment revenue.8
On the defensive side, India is strong
a defense industry base by 41 Ordnance
Industries (OFs) 9 and 9 Public Defense Sector
Jobs (DPSUs), 10 joint construction
part of the public sector; and more
100 private companies. Defense Research
& Development Organization (DRDO), India’s
The Prime Minister of Defense Research Organization, has
more than 50 laboratories under its egis.11 India
has the third largest army in the world.
Significantly, between 2011 and 2016, India went
has always been the largest seller in the world
weapons, accounting for 14% of exports
weapons.12 Increase in India’s defense budget
for the past two decades it has been remarkable.
From 2000 to 2010, India’s defense
the budget allocation almost tripled from INR 58,587
Cross to INR 141,781 Crores.13 In 2015, i
the budget budget for defense has increased to INR 222,370
Crores. India was recognized as the seventh
major countries spend money on the military, after the U.S.A.,
China, Russia, Saudi Arabia, France and the UK
in 2015. In 2016, India moved up to fourth place
major countries spend money on the world military.
Various international security companies have done this
increase their investment in India.
There have been various joint ventures
announcements in the last second category
years. Large A&D companies such as Airbus,
Boeing, Lockheed Martin, and Safran already
have feet in the Indian market, with
some of them plan to invest more.15
For example, Airbus has announced joint-venture
and Mahindra Defense Systems last year
making Indian helicopters
military.16 Similarly, Boeing entered
partnering with Tata Advanced Systems in
December 2015, where they will produce
fossils of Apache helicopters in India.17
As the industry continues to open up, there will be
an increase in global defense incoming companies
Indian market. India has signed 15 contracts
worth USD 10.5 billion with foreign traders
2016 (up to October 2016) including contracts
for 145 M777 lightweight Howitzers.18 One of
major defense contracts in history by
Medium-sized fighter jets
collaborates with French manufacturer Dassault of
36 Rafale fighter jets.19 Many projects have
followed immediately. For example, the first of six
Scorpene dieselelectric attack submarines were
released in December 2015 and continues
0 Similarly, the first squadron of
Indigenously produced LCA Tejas were installed
enlisted in the Indian Air Force on July 2016.21
2 years ago, India signed a defense
co-operation agreements and MoUs with termination
20 countries, which fall into Missile Technology
Law regulation, and the strengthening of the two states
relationships with major suppliers. For example,
India has signed a military operation agreement with
in the United States and was recognized as ‘great
security partner, ’which will result in no license
access to a variety of dual technology applications.
India is also in the process of developing co-operation
a secret fifth-generation fighter jet with
Russia under the PAK-FA program, and HAL
working in partnership with Sukhoi
Until 2014, a lack of focus and funding
research and development (R&D) in
public sector, associated with the absence of
allows the eco-system to thrive in other countries
direct investment (FDI) and the private sector,
prevented India from building its own defense
skills. However, years from 2014
saw a tectonic shift in the defensive zone.
The industry has seen a strong influx
of continuous change. Policy processes have had
approved to ensure proper procurement,
business ease and low entry barriers.
March 28, 2016, Defense Procurement
Procedure 2016 (DPP 2016) was introduced with
major amendments to DPP 2013,
to provide effective and efficient delivery
purchase of defense technology as well
equipment, great incentives in the private sector
- Promising transparency and probity in
process. Aims to promote ‘Make in India’
by promoting home growth
defense industry, and introduces the Buy (IndianIDDM) and Buy and Make (Indian) categories
to buy. For government-funded projects,
government’s financial commitment has increased
from 80% to 90% prototype development,
20% of the total development costs
prepaid. Clarity has been
issued to strengthen the implementation of offset operations
obligations by amended offset policy
which addressed key industry issues such as
installation of services as a means of extraction
offsets and reviews Indian Offset Partner in
allow complete release of bonds
Need for an Industrial License
(IL) production of self-defense equipment,
is in line with the process of issuing complex licenses,
it was an important roadblock to private access
companies in the defense sector. Through
a series of notices issued between June 26,
2014 and September 22, 2015, government
set the requirement for licenses
in the notified list of protective equipment, that is
was released to the public.23 Legality
IL is increased from 3 to 15 years,
extended to 18 years in terms of longevity
gestational age of defense contracts. I
the application process is done automatically again
made easy.
However, it was felt that India was powerful
to attract too many foreign investors
can be gained by continuing to release again
simplifying the FDI system. Therefore, the Union
The government severely restricted FDI
state June 20, 2016. In the field of defense,
The FDI rate has risen from 26% to 49% below
automatic route, 25 and over 49% through
the route of government approval wherever possible
resulting in access to modern technology or
other reasons to be recorded.26 FDI limit of
the defense industry has also been put into operation
the manufacture of small arms and ammunition
compiled under the Arms Act 1959. This is one of
The most important policy efforts made by
Government in the defense sector. Previously, there
it was a state of “modernization
technology ”foreign companies to
accounted for more than 49.0 percent of the area
jobs. However, the government changed
this situation depends on “any modern technology
another reason not to be recorded ”, he relaxed
entry barriers to unlock sector
greater international participation and practice
the most attractive international defense companies to
enter and work in India. In addition, Foreign
The Investment Promotion Board (FIPB) has been
eliminated, shortened the leg of the authorization process.
As per the General Operating Procedure
released June 29, 2017, FDI proposals are
will now be directed by the DIPP to stakeholders
powerful authority (Department
Production Protection) while security clearance
will be sought at the same time as the Department
of the Department of Home Affairs. Submit FDI relaxation
regulation, Indian defense sector is possible
record the growth of cooperatives and relationships,
and the rise of foreign founding companies
production facilities in India
Another long-term need for privacy
the field has become one of the playgrounds
between public and private companies. Self-defense
Public Sector Agreements, to date,
you have been granted exemption from payment
customs and property taxes on products
given to soldiers. These
release revoked April 30,
2015 for the purpose of attracting the interest of
foreign players in the market
Regarding technology transfer (ToT),
DPP 2016 efforts to promote home growth
defense industry. However, the model makes that clear
they can serve as a guide for outsiders and at home
players to be included in ToT programs
have not yet found their way into the DPP 2016. Meanwhile,
vacuum of specific guidelines about foundation
Intellectual Property Rights (IPR) and type
of intellectual property licenses to be issued
under those plans, it often results in an example
these licenses are limited by foreign investors to
Indian companies. This interferes with the ability of
domestic defense industry to improve technology
equal to outside players. However, to be
the matter of the contract, can be settled by it
negotiating a Smart Area with limited limits
licenses for such programs.
The government also changed gears to direct
its traditional defense industry for export.
Standard Operating Procedure performed
issued to clarify the process once
documents required to provide export
license permit. 66% of the assets he owns
removed from the list of permits for exports to defense.29
Development of export and supply strategy
Indian Defence Estates Service
Perhaps the greatest improvement can be found in
an independent industry from its 2001 tour until
day. The industry has seen many encouraging
styles. Major defense projects testify
increasing the involvement of the private sector. Kwe
the first development contract of its kind, i
the development of the Battlefield Management System
(BMS) was awarded in two consortiums, one
which includes leading private companies
Tata and L & T.30 Joint bid submitted by
two independent players Tata and their Airbus
‘Avro Recovery Program’ approved
May 2015.31 In one of the first of its kind
contract, government approved DRDO
transfer the appropriate technology to confidentiality
firms as reflected in the License Agreement for
Transfer of technology signed by L&T for
Ariel’s car is not working Lakshya.
32 in India
Indigenous Light Aircraft Aircraft
will be inducted into the air force in large numbers
numbers with more than 220 flights expected
for the next ten years.33 Progress in
the beach area have also been promising with
development of a traditional aircraft carrier,
INS Vikrant, to be completed in 2018; and
Scorpene class submarine development e
iMazagaon Docks.34
The power of the private sector is long
known for self-defense. However, most
The policy expected in this forum is the StrategicPartnership model, presented at DPP 2016,
