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'Designed in India' will be emphasised, as this will not only help the country retain Intellectual Property Rights, but also build an "eco- system" for manufacturing defence equipment, it is felt.
To continue with Prime Minister Narendra Modi's Make in India push, under the new rules, indigenously made defence equipment must have at least 40 per cent Indian components. If the design is not Indian, 60 per cent of its components must be Indian.
To encourage research and development in the private sector, the department of defence production will bear 90 per cent of design and development cost of major systems.
Small and medium scale industries will be given from Rs. 3 crore to 10 crore in funding for design and development and contract within 24 months. "If we cannot give them the contract, then we propose to refund their entire cost," the minister said.
"I will try to ensure that at least 30% of our procurement is sourced from them. Defence public sector companies have been instructed to source as much as possible from small and medium industries," he added.
'Designed In India' The Focus As Defence Procurement Rules Change