Indigenous Army purchase up, imports dip in past 2 yrs

Ajay Banerjee

Tribune News Service

New Delhi, August 10

India is slowly moving towards purchase of military equipment from local manufacturers. The import percentage of military equipment has dropped and the indigenous content has risen over the past two years, the Ministry of Defence (MoD) informed the Lok Sabha on August 7.

At the same time, the budgetary allocation for indigenous research has been reduced during the ongoing fiscal. The locally made equipment constituted Rs 49,531.55 crore or 62. 89 per cent of the total military procurement of Rs 78,753.85 crore made during 2014-15, ending March 31.

The indigenous content has steadily risen over the past two years. It was 53.97 per cent in 2012-2013 and 59.01 per cent in 2013-2014, ending March 31 or just two months before the Narendra Modi-led government took over in May 2014.

Globally, India is the largest buyer of weapons and military equipment, accounting for 15 per cent of all such international imports, said a report by Sweden-based think tank Stockholm International Peace Research Institute (SIPRI) in March.

Sources say indigenous products will see a further rise as Defence Minister Manohar Parrikar has accepted a report of a high-level expert committee tasked with suggesting changes in the Defence Procurement Procedure (DPP). It has made recommendations to attract investment, build local confidence and allow “Make in India” and is under study at the MoD.

Headed by former Union Home Secretary Dhirendra Kumar, the committee wants the Comptroller and Auditor General (CAG) to do pre-audit of deals rather than raise objections later. Its report submitted to the MoD also lays down the level of indigenisation and the method of calculating the local content in each defence equipment.

Valuable foreign exchange is needed for import and makes the forces dependent on foreign suppliers.

Modi has promised major changes in the policy allowing greater private participation while firmly saying “Make in India” will get preference. New Delhi’s main suppliers of military equipment such as the US, Russia, France, Israel and UK have responded with a positive intent. However, they now await changes in the DPP that will clarify the terms and conditions of setting up units in India.