Defence Minister approves 'indigenisation list' to promote domestic defence industry
Defense Minister Rajnath Singh on August 28 approved a fresh list of 780 components and sub-systems that will be procured from the domestic industry after restrictions on their imports under a time-frame of about six years.
IMPORTANT FACTS -
- This step has been taken to promote self-reliance in defence manufacturing and to reduce imports by Defence Public Sector Undertakings (DPSUs).
The Defence Ministry has set a specific time frame for the import ban of goods in the period from December 2023 to December 2028.
This list is in continuation of two similar positive lists brought out in December 2021 and March 2022.
Indigenization of these items will be done through various routes under 'Make' category.
The 'Make' category aims at achieving self-reliance by involving greater participation of Indian industry in defence manufacturing.
Projects related to the design and development of equipment, systems, major platforms or their upgrades by the industry can be taken up under this category.
Indigenous development of these items will boost the economy and reduce the import dependence of DPSUs.
DPSUs will soon issue Expression of Interest (EoI) and Request for Proposal (RFP).
ADDITIONAL INFORMATION -
What is a positive indigenization list ?
A positive indigenization list means that the armed forces will procure the listed items only from domestic manufacturers.
Manufacturers can be private sector players or Defence Public Sector Undertakings (DPSUs).
Govt Initiatives for indigenisation in defence sector :
The Foreign Direct Investment (FDI) limit under the automatic route in the defence sector has been increased from 49% to 74%.
In October 2021, the government dissolved the four-decade-old Ordnance Factory Board (OFB) and merged 41 factories of seven new state-owned companies to manufacture defence hardware ranging from munitions to heavy weapons and vehicles.
India has inaugurated two defence industrial corridors, one in Tamil Nadu and the other in Uttar Pradesh, to promote the flagship "Make in India" programme.
According to an estimate, the Indian Armed Forces are projected to spend around USD 130 billion in capital procurement over the next five years.
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