Lok Sabha Question No. 2117 (UNSTARRED), answered on 2021-12-10
Subject: Export of Defence Equipment
Ministry: DEFENCE
Asked by: Manoj Kishorbhai Kotak, Malook Nagar, Raksha Nikhil Khadse

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

## LOK SABHA UNSTARRED QUESTION NO.2117

TO BE ANSWERED ON 10 th  DECEMBER, 2021

## EXPORT OF DEFENCE EQUIPMENT

## 2117.  SHRI MANOJ KOTAK:

SHRI MALOOK NAGAR:

SHRIMATI RAKSHA NIKHIL KHADSE:

Will the Minister of DEFENCE be pleased to state:

- (a) whether India's defence exports has increased more than seven times during the last seven years;
- (b) if so, the details of defence exports during the last five years;
- (c) whether the Government has formulated any policy regarding export of defence equipment manufactured under 'Make in India' programme;
- (d) if so, the details thereof along with the steps taken to promote exporters of defence equipment;
- (e) whether any target has been fixed for export of defence equipment, if so, the details thereof; and
- (f) whether the manufacturers of defence equipment are likely to be granted permission to directly sell their products outside the country without any Government partnership and if so, the details thereof?

## A    N    S    W    E    R

MINISTER OF STATE IN THE MINISTRY OF DEFENCE

(SHRI AJAY BHATT)

- (a) & (b): Since 2016-17 to 2018-19, the Defence Exports increased by almost seven times. The details of exports of last five years is as follows: -

|                                |   2016-17 |   2017-18 |   2018-19 |   2019-20 |   2020-21 |
|--------------------------------|-----------|-----------|-----------|-----------|-----------|
| Total Export value (in Crores) |   1521.91 |   4682.36 |   10745.8 |   9115.55 |   8434.84 |

- (c) to (e) Many reforms/steps have been taken to boost Defence exports and bring ease of doing business in recent times. A statement is attached .
- (f) Export of  Munitions  List  Items  specified  in  Category  6  of  Special  Chemicals,  Organisms, Materials,  Equipment  and  Technologies  (SCOMET)  is  restricted.    DGFT  has  delegated powers  to  Department  of  Defence  Production  to  grant  authorisation  for  export  of  items covered  in  Category  6  of  SCOMET.  The  authorisation  for  export  of  items  covered  in Category  6  of  SCOMET  is  granted  in  accordance  with  the  provisions  of  the  Standard Operating  Procedure issued  by  the  Department  of Defence Production  (DDP),  Ministry  of Defence.

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## STATEMENT  REFERRED  TO  IN  REPLY  TO  PART  (c)  TO  (e)  OF  LOK  SABHA UNSTARRED  QUESTION  NO.  2117  FOR  ANSWER  ON  10.12.2021  REGARDING 'EXPORT OF DEFENCE EQUIPMENT'

- (i) Special  Chemicals,  Organisms,  Materials,  Equipment  and  Technologies  (SCOMET) Category 6 titled 'Munitions List' that was hitherto 'Reserved' has been populated and Military Stores list notified vide Notification No.115(RE-2013)/2009-2014 dated 13 th March 2015 stands rescinded.
- (ii) The  Director  General  of  Foreign  Trade  (DGFT)  vide  Public  Notice  No.  4/2015-20 dated 24 th April, 2017 has delegated its authority and notified Department of Defence Production(DDP)  as  the  Licensing  Authority  for  export  items  in  Category  6  of SCOMET. The export of items specified in Category 6 (Munitions List) except those covered under Notes 2 & 3 of Commodity Identification Note (CIN) of the SCOMET is  now  governed  by  the  Standard  Operating  Procedure  issued  by  the  Department  of Defence Production (DDP), Ministry of Defence.
- (iii) Standard Operating Procedure (SOP) for the export of munitions list items have been simplified and placed on the website of the DDP.
- (iv) A completely end-to-end online portal for receiving and processing export authorisation permission has been developed. The applications submitted on this portal are digitally signed and the authorisation are also issued digitally, at faster pace.
- (v) In repeat orders of same product to the same entity, consultation process has been done away with and permission is issued immediately. For the repeat order of same product to  different  entity,  the  consultation  earlier  done  with  all  stakeholders  is  now  limited only with MEA.
- (vi) In  Intra-Company business (which is especially relevant for outsourcing of work by defence  related parent company  abroad  to  its  subsidiary  in India), the earlier requirement of getting End User Certificate (EUC) from the Government of importing country has been done away with and 'Buying' Company is authorized to issue the EUC.

- (vii) The  requirement  of  Government  signed  EUC  in  cases  of  providing  engineering services (ToT related to Munitions List) to Wassenaar Arrangement (WA) Countries has been dispensed with.
- (viii) Legitimate export of systems/platforms for civil end use to WA Member countries is considered subject to submission of EUC or import certificate or equivalent document issued by the Government of importing country.
- (ix) The legitimate export of the parts and components of small arms and body armour for civil use are now being permitted after prior consultation with MEA.
- (x) For  export  of  items  for  exhibition  purposes,  the  requirement  of  consultation  with stakeholders has been done away with (except for select countries).
- (xi) Powers  have  been  delegated  to  DRDO  and  CMDs  of  DPSUs  for  exploring  export opportunities and participation in global tenders.
- (xii) New  simplified  End  User  Certificate  Format  for  Parts  &  Components  has  been provided in SOP.
- (xiii) Validity of Export Authorization for export of parts & components has been increased from 02 years to date of completion of order/component whichever is later.
- (xiv) A  new  provision  for  re-exporting  parts  and  components  for  undertaking  repair  or rework to provide replacement for a component under warranty obligation is inserted in the SOP as a sub-classification of repeat orders.
- (xv) MHA vide Notification  dated  1.11.2018  has  delegated  its  powers  to  Department  of Defence Production to issue export license under Arms Rules 2016 in Form X-A, for parts & components of small  arms. With this the Department of Defence Production becomes the single point of contact for exporter for export of parts and components of Small Arms & Ammunitions.
- (xvi) The Government has notified the Open General Export License (OGEL) -  a one time export  license,  which  permits  the  industry  to  export  specified  items  to  specified destinations, enumerated in the OGEL, without seeking export authorisation during the validity of the OGEL. OGEL has been integrated with end to end online Portal.

- (xvii) Scheme for Promotion of Defence Exports has been notified to provide an opportunity to the prospective exporters an option to get their product certified by the Govt. and provides  access  to  the  testing  infrastructure  of  Ministry  of  Defence  for  initial validation  of  the  product  and  its  subsequent  field  trials.  The  certificate  can  be produced  by  the  prospective  exporter  for  marketing  their  products  suitably  in  the global market.
- (xviii) A  separate  Cell  has  been  formed  in  the  Department  of  Defence  Production  to  coordinate  and  follow  up  on  export  related  action  including  enquiries  received  from various countries, sharing the leads with private sector & public sector companies and facilitate exports.
- (xix) In order to boost defence exports, regular webinars are being organized with Friendly Foreign  Countries  (FFCs)  under  the  aegis  of  DDP,  MoD  through  Indian  Missions abroad  and  Industry  Associations  with  active  participation  from  Indian  Defence Industries.
- (xx) A Scheme to provide financial support to Defence Attaches for taking up actions for promoting exports of India made defence products both of public and private sector in the countries to which they are attached has been notified.

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