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Home arrow News arrow Defence arrow Adopt more flexible approach to capable private players: WB Governor to DPSUs
Adopt more flexible approach to capable private players: WB Governor to DPSUs Print E-mail
Written by Sanjay   
Thursday, 23 December 2010
Kolkata - The Governor of West Bengal, Shri M.K. Narayanan, stated that the Indian Military Sector should display greater faith on indigenous capabilities and that Military and Civilian Bureaucracy need to be more open for the private sector participation in defence sector.

He urged that defence PSUs need to adopt a more flexible approach to capable private players because of their high technological knowledge base. He was speaking at a CII Conference on Industry Defence Linkage in Kolkata.

In his address, he informed that less than 35% of India’s total defence acquisition comes from indigenous sources. However, a major portion of that consists of components of smaller items. Currently 65% of defence acquisition comes from imports. Though the government has aimed to reverse the situation to 70% of indigenous products yet there is scope for more to be done.

Talking about the foreign arms manufacturers, he also opined that they are highly capricious and are often at the mercy of their own government’s foreign policies which are subject to sudden change. In his opinion, foreign firms often violate stringent conditions laid down by Indian Government in regard to defence acquisition which has necessitated the introduction of Integrity Certificates.  

In his address, he also mentioned that India needs to engage in military diplomacy on a bigger scale and use it to her advantage to the fullest like her neighbor China. He mentioned that an emerging economy like India cannot afford to have inadequate defence capabilities, especially with the presence of two major neighbours  who heavily invests on defence materials and strategies on regular basis.

Rear Admiral K C Shekhar, AVSM, VSM, IN (Retd), Chairman, Defence Task Force, CII ER & CMD, GRSE Ltd. said in his address that the Defence Procurement Procedure (DPP)  presents a great opportunity to kick-start the transfer of sophisticated technology and manufacturing in the Defence Sector in India. For various reasons, India has been denied access to these technologies, as a result of which India has not been able to develop domestic capability in this sector, and has been relying largely on Russian supplies to meet her defence needs.

Over the years, as the Indian Private Industry has gained in technical capacity & expertise, it has also scaled up its demands for reforming the Defence Procurement System with an increased role for the indigenous industry, through domestic Public-Private-Partnership and compulsory Offset requirements to be met by foreign vendors. In this respect, he also referred to the CII Recommendation for 49 percent opening up of the Defence Sector to open up for more FDI in Defence Sector.

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