Published: 11th Feb, 2020
Speaking at DefExpo2020 in Lucknow, Prime Minister set a target of doubling India’s defence exports from Rs 17,000 crore currently to Rs 35,000 crore in five years.
Context
Speaking at DefExpo2020 in Lucknow, Prime Minister set a target of doubling India’s defence exports from Rs 17,000 crore currently to Rs 35,000 crore in five years.
About
- He pitched India as the next defence manufacturing hub.
- He also highlighted that only 270 defence licenses were issued till 2014 and now the number is 460.
- He set a target of boosting MSMEsin defence to 15,000 in the next five years.
- CAG report tabled in Parliament said, soldiers deployed in Siachen and Ladakh were forced to procure recycled high-altitude clothing and boots between 2015 and 2016 due to the budgetary constraints.
Present day ground reality
- Poor performance of defence Public Sector Undertakings. It is incidental to note that India is the second largest buyer of weapons between 2014 and 2018, and it is putting huge burden on the ex-chequer.
- Lack of in roads by the private sector.
- Some of the platforms like missile programmes were successful, but for example, Tejas Light Combat Aircraft took more than three decades to reach induction stage. Indigenisation efforts are quite uneven and slothful (slow).
- Moreover, defence budget minus pensions, this time is around 1.5% of GDP and lowest since 1962.
- With defence salary and pension bills growing, funds for modernization are crunched. The Union Budget for 2020-21 has allocated Rs. 1,33,825 crore to defence pensions.
- This is up by 10½ times in a decade and a half, from Rs. 12,715 crore in 2005-06. The current ratio of military pensioners to serving military personnel is 1.7 to 1, while the ratio of civil pensioners to civil working personnel is 0.56 to 1.
Can India become a defence manufacturing powerhouse?
- Following aspects need to be kept into consideration
- Making successful the strategic partnership model. Here the Government should give prominence to the private sector.
- Government announced two Defence Industrial Corridors, in Uttar Pradesh and Tamil Nadu. It is not clear at this juncture, how the manufacturing ecosystem will evolve.
- There is a need for creating vibrant American style military-industrial complex. This would entail not just greater private participation, but also create a defence ecosystem involving science and research institutes.
- Our Universities need to be scaled-up so that they can contribute meaningful research towards the defence industry, while attracting the best brains around the World.
- Necessary budgetary allotments with more allocations for capital expenditure.
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