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SETTING UP THE DEFENCE INDUSTRIAL ECOSYSTEM

Last week was an interesting one for Indian defence manufacturing. On Monday, Tata Advanced Systems Ltd and US plane-maker Lockheed Martin Corp. signed an agreement at the Paris Air Show to produce F-16 fighter jets in India. On Tuesday, in Delhi, Reliance Defence entered into a strategic partnership with Serbia’s Yugoimport for ammunition manufacturing in India. On Wednesday, back in Paris, Reliance Defence joined hands with France’s Thales to set up a joint venture that will develop Indian capabilities in radars and high-tech airborne electronics.

In Moscow, on Friday, defence minister Arun Jaitley and his Russian counterpart signed off on a road map for strengthening bilateral military ties. Meanwhile, at home in India, the army rejected, for the second year in a row, an indigenously-built assault rifle after it failed field tests—a pointed reminder of how the country’s sub-par defence industry continues to damage the military’s operational preparedness.

For the most part, India has sought to make up for that failing at home with imports from abroad. Between 2012 and 2016, India was the world’s largest importer of major arms, accounting for 13% of the global total and increasing its arms imports by 43% from the 2007-11 period, according to the Stockholm International Peace Research Institute (Sipri).

That being said, in recent years there has been a greater focus on developing indigenous capabilities through technology transfers and joint production projects with international partners. The Narendra Modi government has also put defence at the core of its flagship domestic manufacturing programme, Make in India. It has opened up the still largely state-run sector to private players and foreign firms in an effort to build a “defence industrial ecosystem” that will not only support the country’s military requirements but also emerge as an important economic lever—generating exports, creating jobs, and spurring innovation.