Lok Sabha Question No. 252 (STARRED), answered on 2016-12-02
Subject: Production of Military Hardware
Ministry: DEFENCE
Asked by: George Baker

## GOVERNMENT OF INDIA MINISTRY OF DEFENCE

## DEPARTMENT OF DEFENCE PRODUCTION

## LOK  SABHA

## STARRED QUESTION NO.252

TO BE ANSWERED ON THE 2 ND  DECEMBER, 2016

## PRODUCTION OF MILITARY HARDWARE

*252.  SHRI  GEORGE BAKER:

Will the Minister of DEFENCE j{kk ea=h be pleased to state:

- (a) the present status of 'Make in India' initiative with regard to military hardware in the country;
- (b) the number of companies involved in this initiative, State / UT-wise;
- (c) whether the Government has purchased military hardware from the said companies;
- (d) if so, the details thereof along with the funds incurred for this purchase; and
- (e) the steps taken by the Government to increase the production capacity of military hardware in the country?

## A    N    S    W    E    R

MINISTER OF DEFENCE                                   (SHRI MANOHAR PARRIKAR)

j{kk ea=h

¼Jh euksgj ijhZdj½

(a) to (e): A Statement is laid on the Table of the House.

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## STATEMENT  REFERRED  TO  IN  REPLY  TO  PARTS  (a)  TO  (e)  OF  LOK SABHA STARRED QUESTION NO. 252 FOR ANSWER ON 2.12.2016

Since  the  launch  of  'Make  in  India'  in  September  2014,  several measures  have  been  taken  by  the  Government  to  promote  indigenous design, development and manufacture of military hardware in the country by  harnessing  the  capabilities  of  the  public  and  private  sector.    These measures include according priority and preference to procurement from Indian  vendors  under  the  Defence  Procurement  Procedure  (DPP)  2016, liberalization  of  the  licensing  regime  and  providing  access  to  modern technology  to  Indian  industry  by  raising  the  cap  on  FDI  in  the  defence sector,  simplification  of  export  procedure,  streamlining  of  defence  offset guidelines etc.

2. The  new  Defence  Procurement  Procedure  (DPP)  2016  has  been promulgated  for  capital  procurements  and  has  come  into  effect  from  1 st April 2016.  DPP-2016 has a focus on achieving the 'Make in India' vision by according priority to  'Buy  Indian - IDDM (Indian Designed, Developed and  Manufactured)  and  'Buy  (Indian)'  categories.  It  also  focuses  on enhancement and rationalization of indigenous content. The 'Make Procedure  has  been  simplified  with  provisions  for  funding  of  90%  of development  cost  by  the  Government  to  Indian  industry  and  earmarking projects  not  exceeding  development  cost  of  Rs.10  crore  (government funded) and     Rs.3 crore (industry funded) for MSMEs.
3. After  opening  up  of  the  Defence  Industry  Sector  for  private  sector participation  in  2001,  so  far  342  Letters  of  Intents  (LOIs)  /  Industrial Licenses (ILs) have been issued to 205 Indian companies till June 2016 for manufacture  of a wide range of defence  items to public / private companies.  The State / Union Territory-wise, number of LOIs / ILs issued is placed at Annexure-I.

:  2  :

4. Government has purchased Military hardware from Indian companies.    The  details  of  fund  spent  on  procurement  of  defence  items from Indian companies in the last 2 years and current year (upto October 2016) are given below:
5. Apart from the measures taken by the government as enumerated at para  1  above,  73  contracts  involving  a  value  of  Rs.72,303.34  crore  were signed with Indian vendors during the last two financial years (2014-15 and 2015-16).
6. 85 cases involving Rs.1,60,362 crore have been accorded Acceptance of Necessity (AON) by Defence Acquisition Council under the 'Buy (Indian)' 'Buy & Make (Indian)' and 'Buy & Make' categories.

(Rs. in crore)

|                             |   Total Procurement |   Procurement from Foreign Vendors | Procurement from Indian Vendors (%)   |
|-----------------------------|---------------------|------------------------------------|---------------------------------------|
| 2014-15                     |             77986.3 |                           29159.7  | 48826.63 (62.6%)                      |
| 2015-16                     |             76178.8 |                           26190.5  | 49988.34 (65.6%)                      |
| 2016-17 (upto October 2016) |             32073.2 |                            9278.26 | 22794.92 (71.1%)                      |

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## ANNEXURE-I  REFERRED  IN  THE  REPLY  GIVEN  IN  THE  STATEMENT  IN PARTS  (a)  TO  (e)  OF  LOK  SABHA  STARRED  QUESTION  NO.  252  FOR ANSWER ON 2.12.2016

## State / Union Territory-wise number of Letters of Intents (LOIs) / Industrial Licenses (ILs) issued to Indian Companies till June 2016:

|   Sr. No. | State / Union Territory   |   No. of LOIs / ILs issued |
|-----------|---------------------------|----------------------------|
|         1 | Andhra Pradesh            |                          2 |
|         2 | Chandigarh                |                          2 |
|         3 | Delhi                     |                          1 |
|         4 | Goa                       |                          2 |
|         5 | Gujarat                   |                         25 |
|         6 | Haryana                   |                         24 |
|         7 | Himachal Pradesh          |                          2 |
|         8 | Jharkhand                 |                          2 |
|         9 | Karnataka                 |                         72 |
|        10 | Kerala                    |                          2 |
|        11 | Madhya Pradesh            |                         15 |
|        12 | Maharashtra               |                         44 |
|        13 | Puducherry                |                          1 |
|        14 | Punjab                    |                          4 |
|        15 | Rajasthan                 |                          4 |
|        16 | Tamil Nadu                |                         20 |
|        17 | Telangana                 |                         67 |
|        18 | Uttar Pradesh             |                         31 |
|        19 | Uttarakhand               |                          8 |
|        20 | West Bengal               |                          4 |
|        21 | More than one Location *  |                         10 |

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