Lok Sabha Question No. 1510 (UNSTARRED), answered on 2023-02-10
Subject: Import in Defence Sector
Ministry: DEFENCE
Asked by: Ranjanben Dhananjay Bhatt

## GOVERNMENT OF INDIA MINISTRY OF DEFENCE DEPARTMENT OF DEFENCE

## LOK SABHA

## UNSTARRED QUESTION NO. 1510

TO BE ANSWERED ON 10 th  February, 2023

## IMPORT IN DEFENCE SECTOR

## 1510.  SHRIMATI RANJANBEN DHANANJAY BHATT:

Will the Minister of DEFENCE be pleased to state:

- (a)  whether the Government is contemplating to reduce imports in the defence sector;

(b)  if so, the details thereof along with specific steps taken by the Government in this regard; and

(c) if not, the reasons therefor?

## A  N  S  W  E  R

## MINISTER OF STATE IN THE MINISTRY OF DEFENCE

(SHRI AJAY BHATT)

(a)  to  (c):  (i)  Capital  procurement  of  defence  equipment  are  undertaken  from  various domestic as well as foreign vendors, based on threat perception, operational challenges and technological changes so as to keep the Armed Forces in a state of readiness and to meet the entire spectrum of security challenges.

(ii) Defence Procurement Procedure (DPP) and Defence Acquisition Procedure (DAP 2020) with  a  focus  on  'Atmanirbhar  Bharat'  and  'Make  in  India'  introduced  major  policy initiatives  for  boosting  indigenous defence capability and reduction  of reliance on  imports. Further,    DAP-2020  provides  the  highest  preference  to  'Buy  Indian  (IDDM)'  category  of acquisition  and  'Buy  Global'  is  only  permitted  in  exceptional  situations  with  specific approval of Defence Acquisition Council (DAC) / RakshaMantri.

(iii) To  achieve  self-reliance in defence  sector  and to provide impetus  to design, development  and  manufacture  of  defence  equipment/platforms  in  India,  the  following initiatives/policies have been taken/made by the Government:-

- i. A  new  category  of  'Buy  (Global-  Manufacture  in  India)'  has  been  introduced  to enable ab-initio indigenisation of spares. This category encourages Foreign OEMs to set up 'Manufacturing/maintenance entities' through its subsidiary in India.
- ii. The  Government  has  introduced  Make  III  categories  with  the  objective  of  selfreliance through import substitution.
- iii. Notification  of  the  'Positive  Indigenisation  lists'  of  weapons/platforms  banned  for import to be indigenously manufactured.

- iv. Reservation of Cases with AoN cost ≤100 Crs, extendable to Cases of AoN cost ≤ 150 Crs if annual cash flow based on deliveries is below Rs. 100 Crs for MSMEs.
- v. Simplification of Industrial licensing process with longer validity period.
- vi. Launch of innovations for Defence Excellence (iDEX) scheme involving start-up & Micro, Small and Medium Enterprises (MSMEs).
- vii. Reforms  in  Offset  policy  with  thrust  on  attracting  investment  and  transfer  of Technology of Defence manufacturing by assigning higher multipliers.
- viii. Launch of indigenisation portal namely SRIJAN to facilitate indigenisation by Indian Industry including MSMEs.
- ix. Establishment  of  two  Defence  Industrial  Corridors,  one  each  in  Uttar  Pradesh  and Tamil Nadu.
- x. Opening up of Defence Research & Development (R&D) for industry, start-ups and academia with 25 percent of defence R&D budget earmarked to promote development of defence technology in the country.
- xi. Progressive  increase  in  allocation  of  Defence  Budget  of  military  modernisation  for procurement from domestic sources.
- xii. In  line  with  Government  of  India's  initiative  of  Atmanirbhar  Bharat,  MoD  has earmarked funds amounting to Rs. 84,598 Cr (68% of the total Capital Acquisition Budget) for the domestic capital procurement in 2022-23.

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