Capital expenditure on defence purchase from Indian firms goes up -Governance Now

Capital expenditure on defence purchase from Indian firms goes up

Foreign companies are allowed to have tie-ups with Indian vendors for indigenous production

GN Bureau | August 10, 2017

#defence procurement

Minister of state for defence, Subhash Bhamre said that the capital expenditure on procurement of defence equipment from Indian vendors has increased from Rs 31,575 crore in 2013-14 to Rs 41,873 crore in 2016-17.

Bhamre was speaking on Make in India initiative in the Lok Sabha. He further said that 2014-15 and 2016-17, the government has accorded Acceptance of Necessity (AoN) for 145 proposals worth Rs 3,99,800 crore approximately, out of which 103 proposals worth Rs 2,46,400 crore have been approved.

Make in India in defence manufacturing is primarily driven by capital acquisition of defence equipment and other policy measures taken to promote indigenous design, development and manufacture of defence equipment in the country by harnessing capabilities of the public and private sector.

These measures include according priority and preference to procurement from Indian vendors under the Defence Procurement Procedure 2016, liberalisation of the licensing regime and FDI policy by raising the cap on FDI in the defence sector.

Foreign companies are allowed to have tie-ups with Indian vendors for indigenous production involving Transfer of technology under ‘Buy & Make (Indian)’ and ‘Buy & Make’ categories of capital acquisition.

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