Lok Sabha Question No. 3445 (UNSTARRED), answered on 2015-12-18
Subject: Indigenisation of Military Hardware
Ministry: DEFENCE
Asked by: BAIJAYANT "JAY" PANDA

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

## LOK  SABHA

## UNSTARRED QUESTION NO.3445

TO BE ANSWERED ON THE 18 TH  DECEMBER, 2015

## INDIGENISATION OF MILITARY HARDWARE

## 3445.  SHRI  BAIJAYANT JAY PANDA:

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

- (a) the present status of indigenisation of military hardware in the defence sector;
- (b) the share of procurement of such defence equipment from domestic, public and private sector;
- (c) whether the Government has developed the scientific methodology to assess the level of indigenisation achieved by the defence units in the country; and
- (d) if so, the details thereof and if not, the reasons therefor?

## A    N    S    W    E    R

MINISTER OF STATE IN THE MINISTRY OF DEFENCE

j{kk jkT; ea=h

(a) to (d):

A statement is attached.

(RAO INDERJIT SINGH)

¼jko banzthr flag½

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## STATEMENT  REFERRED  TO  IN  REPLY  TO  PARTS  (a)  TO  (d)  OF  LOK SABHA UNSTARRED QUESTION NO. 3445 FOR ANSWER ON 18.12.2015

(a) & (b): As per an internal analysis carried out by the Department of Defence Production the indigenous content in defence procurements for the year 2014-15, is approximately 40%. The details regarding procurement from public and private sector, separately are not maintained  in  the  department.    However,  the  details  of  procurement  of defence items from Indian sources and foreign sources for the year 201415 are given below:

| THE VALUE OF PROCUREMENT OF DEFENCE ITEMS FROM INDIAN AND FOREIGN SOURCES IN THE YEAR 2014-15 FOR ARMY, AIRFORCE AND NAVY Rs. in crore)   | THE VALUE OF PROCUREMENT OF DEFENCE ITEMS FROM INDIAN AND FOREIGN SOURCES IN THE YEAR 2014-15 FOR ARMY, AIRFORCE AND NAVY Rs. in crore)   | THE VALUE OF PROCUREMENT OF DEFENCE ITEMS FROM INDIAN AND FOREIGN SOURCES IN THE YEAR 2014-15 FOR ARMY, AIRFORCE AND NAVY Rs. in crore)   | THE VALUE OF PROCUREMENT OF DEFENCE ITEMS FROM INDIAN AND FOREIGN SOURCES IN THE YEAR 2014-15 FOR ARMY, AIRFORCE AND NAVY Rs. in crore)   | THE VALUE OF PROCUREMENT OF DEFENCE ITEMS FROM INDIAN AND FOREIGN SOURCES IN THE YEAR 2014-15 FOR ARMY, AIRFORCE AND NAVY Rs. in crore)   |
|-------------------------------------------------------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------------------------------------------------|
| Year                                                                                                                                      | Total Procurement                                                                                                                         | Procurement from foreign sources                                                                                                          | Procurement from Indian sources                                                                                                           | Percentage of Procurement from Indian sources                                                                                             |
|                                                                                                                                           | I                                                                                                                                         | II                                                                                                                                        | III                                                                                                                                       | III I x 100                                                                                                                               |
| 2014-15                                                                                                                                   | 78753.85                                                                                                                                  | 29222.30                                                                                                                                  | 49531.55                                                                                                                                  | 62.89%                                                                                                                                    |

(c) & (d): The  methodology  for  computation  of  'Indigenous  content'  for an  equipment  or  an  item  has  been  prescribed  in  Defence  Procurement Procedure-2013.  It stipulates that 'Indigenous content' shall be arrived at by  excluding  from  the  total  cost  of  that  equipment  /  item,  the  following elements at all stages (tiers) of manufacturing / production / assembly:

- (i) Direct  costs  (including  freight  /  transportation  and  insurance) of all materials, components, sub-assemblies, assemblies and products imported into India;
- (ii) Direct  and  Indirect  costs  of  all  services  obtained  from  nonIndian entities / citizens;
- (iii)  All  license  fees,  royalties,  technical  fees  and  other  fees  / payments of this nature paid out of India, by whatever term / phrase referred to in contracts / agreements made by vendors / sub-vendors; and
- (iv)  Taxes, duties, cesses, octroi and any other statutory levies in India of this nature.

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