Lok Sabha Question No. 4890 (UNSTARRED), answered on 2017-03-31
Subject: Defence Start-ups
Ministry: DEFENCE
Asked by: ASADUDDIN OWAISI

## GOVERNMENT OF INDIA MINISTRY OF DEFENCE DEPARTMENT OF DEFENCE PRODUCTION

## LOK  SABHA UNSTARRED QUESTION NO.4890

TO BE ANSWERED ON THE 31 ST  MARCH, 2017

## DEFENCE  START-UPS

4890.  SHRI ASADUDDIN OWAISI:

Will the Minister of DEFENCE j{kk ea=h be pleased to state: (a) the  total  number  of  defence  start-ups  set  up in  the  country  during  the  last  three years and the current year; (b) whether the Government proposes to create a new technology innovation fund for defence aerospace aimed to prop up start-ups; (c) if so, the details thereof; and (d) the  initiatives  by  the  Government  during  the  above  period  to  develop  /  enable

- a culture of innovation in defence sector?

## A    N    S    W    E    R

MINISTER OF STATE

(DR. SUBHASH BHAMRE)

IN THE MINISTRY OF DEFENCE

र  ा रा य मं ी

(डा. सुभाष भामरे)

(a) to (d): A statement is attached.

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## STATEMENT REFERRED TO IN REPLY TO PARTS (a) TO (d) OF LOK SABHA UNSTARRED QUESTION NO. 4890 FOR ANSWER ON 31.3.2017

(a) Government of India has launched 'Start-up India' initiative in January 2016, which aims at fostering entrepreneurship and promoting innovation by creating an ecosystem that is conducive for growth of start-ups.  The data of start-ups recognized by Department of Industrial Policy & Promotion (DIPP), is maintained by 'Start-up India' and at present, there is no recognized startup in the Defence sector.  However, in order to encourage start-ups and give them  an  opportunity  to  contribute  in  the  defence  production,  Ordnance Factory  Board  (OFB)  and  all  Defence  Public  Sector  Undertakings  (DPSUs) have been mandated to follow the guidelines of Ministry of MSME regarding 'Relaxation of norms for start-ups and Medium & Small Enterprises in public procurements on prior experience - prior turnover criteria'.

(b) to (d): The Government has taken following actions to encourage culture of innovation in defence sector:-

- (i) Under the new Defence Procurement Procedure (DPP) 2016 promulgated in April 2016, the 'Make' Procedure has been simplified. The procedure provides for funding of 90% of development cost by the Government to Indian industry for design, develop  and  manufacture  of  defence  equipment.    Projects  not exceeding development cost of Rs. 10 crore (Government funded) and Rs. 3 crore (industry funded)  have been reserved for MSMEs under this procedure.
- (ii) The Government has recently approved a Defence Innovation Fund (DIF)  with  initial funding by two DPSUs; Bharat Electronic Limited (BEL) and Hindustan Aeronautics Limited (HAL). The fund aims at creation of ecosystem to foster innovation and technology development in Defence, by engaging R&D   institutes / academia and industry  including  start-ups  and  provide  them  the  funding  to carry out innovative development which has the potential for future commercialization.
- (iii) The  Government  has  also  launched  a  scheme  of  Technology Development Fund (TDF) which aims at funding the development of defence and dual use technologies that are currently not available with the Indian defence Industry, or have not been developed so far, thus creating an ecosystem for enhancing cutting edge technology capability for Defence applications. The TDF scheme is implemented  by  Defence  Research  &  Development  Organization (DRDO) and provides for assistance in the form of grant to public and private industries for design and development of key defence technologies.

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