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10 Aug

INDIGENISATION IN DEFENCE:  DEFENCE MINISTER’S NEW DIRECTION

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by Lt Gen JP Singh, PVSM, AVSM, Former Dy Chief of Army Staff

Editorial Comment:  The initiative to help India attain self-reliance in Defence is indeed laudable. However, we need a balanced and deliberate approach. We have been constrained to fast track certain procurements because of the recent face off with China. Consequent to the embargo coming into effect indigenised products may not be readily available in case of an emergent situation. We must have a Plan B in place for such eventualities. 

The  Defence Minister has made an important announcement about  the shift in procurement policies with the aim of achieving self-reliance. The focus being on reducing dependency on imported equipment by giving a boost to indigenous production. To this end a total of 101 items have been placed on the negative import list thus implying that these must necessarily be of Indian origin.  Whilst the intent is clearly commendable, experience tells us that many a times it is easier said than done. In addition, there are several factors that will impact the successful implementation of such a policy, which need to be looked into.

Our DPSUs and OFB have been at the forefront of our indigenous defence manufacture and the Defence Ministers announcement will bring great cheer to them. However, it is a fact that they have failed deliver on a few occasions. One such example is Ammunition, despite several RFPs for Make in India over the last four  years, we are still doing frantic fast track buys to meet our operational requirements. This is because we have not been able to meet the requirements of the armed forces indigenously, in terms of both quality and timelines. DRDO has done good work in fields such as missile technology and a few others but there have also been delays in many instances. We need to  major reforms to address the situation. Technology Audits must be carried out to continually assess performance. There is a need to segregate the DRDO efforts ( manpower, budget, redundancies etc) for strategic and non-strategic sectors. At present no worthwhile R&D is taking place in the non-strategic sector.

Manufacture of defence equipment is a protracted process and takes many years from conception to fructification, even in advanced countries. Whilst we have some big players like the TATAs, L&T, Bharat Forge and Mahindras making successful forays in recent years,  they  would be willing to go whole hog, in terms setting up R &D facilities and manufacturing plants only if assurances in terms of a reasonable number of orders is given. It is difficult to understand how such an assurance can be given to any of the players in the beginning itself i.e. at the time of the RFP being issued.

The negative list does give a lead time for items for which we are not yet well poised, in that the embargo in their case will come into effect three or four years down the line, a case in point being Expendable Aerial Targets for which the embargo is effective Dec 2024. However, it is unlikely that any private player is going to start preparing for manufacturing these now in the hope that one day he will get orders; the day may be several years down the line. Though the lead time given for all items would have been well thought through, it is felt that we need to relook at some e.g. the Inertial Navigation System for ships; a year plus may not suffice.

We have the capability of creating niche technologies but our policies in this regard are not clearly enunciated or oriented towards Defence.  A case in point is the NITI Aayog Discussion paper on National Strategy on Artificial Intelligence 2018, this paper does not have any focus on Defence at all. Such policies for Defence gain tremendous importance in view of the fact that disruptive technologies are going to rule the roost in the not very distant future.

The way forward is to let foreign companies come in with substantial percentage of FDI and technology and manufacture in India in collaboration with industrial houses of repute. The Defence Minister’s announcement is likely to throw up a lot of fly by night operators, this is a trend that will have to be fiercely guarded against.

There should be a gradual move towards indigenisation with a mix of imported and Indian equipment in the interim. What is of the utmost essence is to clearly define what needs to be done during the lead time given for the embargo to be come into effect and by whom. Suitable incentives for the same need to be given, if necessary.

We should not only be ensuring stringent implementation of barring imports but also of the processes for providing alternatives; this includes creating component level supply chains. If the latter is not done the idea will come to a naught. The corporatisation of OFB and DPSUs must not remain an exercise on paper, the sooner it is done the better.

Strategic Partners must be nominated so that they are geared towards the task. There is also a need to relook at the Defence Procurement Structure and Policies and align them to with the intent.

Importantly, our  goal of  becoming ‘Atamnirbhar’ in Defence should not be at the cost of operational  preparedness. It should also not create situations whereby existing foreign collaborations are adversely impacted. We need to proceed with due care and ensure that we not end up in a situation where we have equipment voids or substandard equipment.

 

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