Modified defence procurement policy in three months, defence minister Manohar Parrikar says

[Krate M]

Modified defence procurement policy in three months, defence minister Manohar Parrikar says - TOI Mobile | The Times of India Mobile Site

AHMEDABAD: Defence minister ManoharParrikar said on Sunday that his ministry would come up with defenceprocurement policy (DPP), preferring purchase of equipment made in India, within three months.

Speaking at a seminar 'Gujarat: Preferred Hub for Defence Production' during the Vibrant Gujarat summit, the minister said India cannot afford spending $20 billion on defence procurement, and for this, promoting local manufacturing is must and the country will promote private players in this field. "The government hopes to come up with a document in two or three months on a suitable model for defence manufacturing and procurement...We have listed certain items that are not going to be imported from 2016. These will increase later on. But we are coming up with the document in February-March on modified DPP."

Responding to Gujarat's keenness on having defence equipment manufacturing facilities, the defence minister said that Gujarat has got an "industrial base and a private line also", thus for those intending to invest in defence equipment in Gujarat, it would have double advantage. He said that this is the way to realize Prime Minister Narendra Modi's 'Make in India' dream.

Two companies pledged investment for manufacturing defence equipment in Gujarat, and intend to base this industry in North Gujarat districts of Banaskantha, Sabarkantha and the border district of Kutch apart from the coastal region. Bharat Forge said it would upgrade facilities for armoured fighting vehicles, defence electronics manufacturing and radar manufacturing facilities.

Defence experts also lauded the gesture of inviting private players to manufacture defence equipments in India. Chairman of Saab India Lars Olaf Lindgren said, "Not only India will benefit with this, foreign companies with expertise in different fields will also gain by partnering with India and Indian companies to manufacture in this country."

Sanjay Garg, the defence ministry's joint secretary, said that in the next 7-8 years, the capital budget for modernization of armed forces is going to be $130 billion. This is the perfect condition for any company to come to India.

 

[Krate M]

This compulsory non import is an excellent step. Why should we import items which can be easily made in the country. The tatra truck is a example of this.

 

[sancho]

This compulsory non import is an excellent step. Why should we import items which can be easily made in the country. The tatra truck is a example of this.

Let's wait and see what he actually can do, because his statement goes against NDA policy, which is aimed on increased manufacturing in India, of "imported" arms => foreign LUH in India and not HAL LUH.
If Parrikar is serious with a policy change (and I really hope so), he has to kill the foreign LUH deal and be in favour of HAL's version, just as he has to push Dhruv and not Ka225 (both single engined LUH's), but the PM won't like that.

 

[Krate M]

@sancho
Yes there is a contradiction.
This government wants to get more manufacturing jobs in India, which does not translate to technology development in India. For long term development of country, more focus on technology development has to be there.

But it is easier to get manufacturing jobs due to large pool of qualified people ready to work for relatively lower wages.

Technology development is also infrastructure intensive in many fields. That does not mean that manufacturing doesn't lead to development of IP and tech.

With efforts even manufacturing can lead to development. Read this nice story on how trouble shooting can lead to IP generation, even though good contract trumps over it.

A Tale of two Hydraulics Systems

Another interesting Jaguar story of how we upgraded it.
The DARIN Story | TKS' Tales
I hope you haven't come across these before.
I am digressing I know, your point of "make in India" don't mean designed by India is spot on.

 

[sancho]

But it is easier to get manufacturing jobs due to large pool of qualified people ready to work for relatively lower wages.

I disagree on that, manufacturing jobs are low end jobs. You don't need engineers to operate a machine that produces airframe parts for example. Indias huge advantage on the other side is, the large ammount of young and well educated people with university degrees and we need jobs for them to take India to the next level. That's only possible if we get increased R&D to India, be it from Indian companies, or foreign once like Airbus, that diverts R&D parts to India to benefit from low wages too. If you increase R&D in India, you automatically will increase production too, which then leads to more low end manufacturing jobs as well, but if we focus only on licence productions, we waste the potential of our youth / demographical advantage.

 

[surya kiran]

Let's wait and see what he actually can do, because his statement goes against NDA policy, which is aimed on increased manufacturing in India, of "imported" arms => foreign LUH in India and not HAL LUH.
If Parrikar is serious with a policy change (and I really hope so), he has to kill the foreign LUH deal and be in favour of HAL's version, just as he has to push Dhruv and not Ka225 (both single engined LUH's), but the PM won't like that.

Why should he push the Dhruv and not Ka 225? Though both are single engine they both fit different roles. Let me take your argument in favour of the Rafale and Sukhoi. Dhruv is heavier and carries more load and it serves its purpose. Kamov is lighter and carries less load over a shorter distance. Both serve different requirements. Why would one deploy a Dhruv where you need a Kamov? After all, its about fitting requirments, right?

Please feel free to correct me, since these are more queries than views.

 

[sancho]

Why should he push the Dhruv and not Ka 225? Though both are single engine they both fit different roles.

Both are twin engined LUH, so are in the same class and would fulfill the same roles, just with different performance. So similar to F18 and Rafale being twin engined MMRCAs, that offers different performance in the same roles.
And I was refering to reports that the deal Putin has proposed for the Ka226, was meant to SAR helicopters for the Pawan Hans fleet. Dhruv has proven itself in this role in the several disaster relief / rescue opertions, so if we have an Indian solution ready and available, that should be prefered over the license production of similar foreign helicopters.

 

[Krate M]

@sancho completely agree with you.
With a small difference in opinion. A lot of engineering diploma and degree level people can be employed by manufacturing, along with fitters turners etc.
(I believe) The government strategy seems to be get manufacturing first then get the r&d later. This makes sense in the short term. But r&d later is a must. Getting manufacturing is a low hanging fruit.

That said, we need to change the current r&d setup mentality of India wholesale.
From private to public, from IITs and IISc to college labs, from DRDO to smallest obscure government labs, the system needs a complete overhaul. The lack of collaboration, exposure to industry, silo like government labs, single minded/track industry labs, lack of research culture at basic level etc needs to be shaken off.

The government needs to stop pouring in money without accountability, just because it has to match Chinese spending. This happens in armed forces and research direction, causing widespread misuse.

PS: I hope you read those linked pages. Would like some discussion on them, maybe in another thread.

 

[sancho]

completely agree with you.
With a small difference in opinion. A lot of engineering diploma and degree level people can be employed by manufacturing, along with fitters turners etc.

Can, but don't have to, since these licence production deals have only a limited timetline and after that, the companies will switch to producing something else. Only if proper R&D is part of the company aims, they will need engineers and only then they will have long term goals which will benefit Indias defence industry.

(I believe) The government strategy seems to be get manufacturing first then get the r&d later. This makes sense in the short term.

The government strategy is based on political reasons, to get jobs to India, via licence productions to privat industry. The key problem however is, that they "hope" for exporting the parts produced in India too, that however is dependent on global demand on these products and the global demand currently is at a low point, one reason why Chinas growth is slowing down.
We have to focus on our own Indian market, the huge need for defence products, just as the growing Indian middle class, that consumes more and more. So looking on producing things for export, when the real market is at home won't work out.

PS: I hope you read those linked pages. Would like some discussion on them, maybe in another thread.

Have read the Darin story before, but not the other one, will read it later. Am going through some older DDPs at the moment, wrt to the MMRCA liquidity damages.