Policy on private sector's role in defence production soon

Policy on private sector's role in defence production soon

NEW DELHI: The defence ministry is now looking to finalize the much-touted but long-delayed "strategic partnership (SP)" policy for private sector participation(भाग लेना) in defence production in
the country.

Sources said the defence acquisitions council (DAC), chaired by defence minister Arun Jaitley, will meet to discuss the SP policy later this month. "The policy is likely to be cleared in the DAC meeting. The contentious(विवादास्पद) issues have more or less been sorted out," said a source.

The SP model seeks to create capacity for arms production in the private sector on a long-term basis, over and above the capacity and infrastructure that exist in the defence PSUs, and gradually replace the existing system to award contracts only to the lowest bidder (L-1), as was earlier reported by TOI.

It flows from the reports of the Dhirendra Singh and V K Aatre expert committees, which proposed selection and nomination of Indian private sector defence companies as strategic partners for global armament companies to jointly produce weapon systems under the "Make in India" policy.

The broadly identified segments in Group-1 are aircraft, helicopters, aero-engine, submarines, warships, guns and artillery, and armoured vehicles like tanks. Metallic materials and alloys, non-metallic material and ammunition (including smart munitions) figure in the technology areas in Group-2.

The SP policy was to be part of the new Defence Procurement Procedure (DPP), which came into effect in April 2016, but has not been finalized till now. This has further delayed the proposed projects for a new fighter production line as well as the Rs 70,000 crore project to build six new-generation stealth submarines, which was granted "acceptance of necessity" way back in November 2007.

A major bone of contention(विवाद) in the SP policy has been the recommendation that only one private sector company be selected as the strategic partner in each of the seven segments in Group-1, while two are nominated in each category in Group-2.

Moreover, it was proposed that only those private sector companies be selected that have adequate financial strength (Rs 4,000 crore in annual turnover for Group-1 and Rs 500 crore in Group-2), demonstrable manufacturing expertise and ability to absorb technology from their foreign partners.

Given all this, there are concerns that defence production in the country may be cornered(हड़प) by only a few big companies. But MoD sources say "transparency and some competitive selection" will figure in the SP policy that will be cleared to allay such fears.

It is, of course, well-recognized that India needs to encourage private sector to enter defence production in a big way as well as drastically overhaul the functioning of the five defence PSUs, four shipyards, 41 ordnance factories and DRDO and its 50 labs to build a strong domestic defence industrial base. Otherwise, India will continue to wallow in the embarrassing and strategically-vulnerable position of having to import over 65% of its military hardware and software requirements.

Definitions of contentious विवादास्पद

adjective

causing or likely to cause an argument; controversial.

a contentious issue

synonyms: controversial, disputable, debatable, disputed, open to debate, vexed

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Definitions of corner हड़प

adjective
having a specified number of places or angles where the edges or sides meet.
young boys in six-cornered hats
(of a person or animal) forced into a place or situation from which it is hard to escape.
nothing is more dangerous than a cornered wild beast
verb
force (a person or animal) into a place or situation from which it is hard to escape.
the man was eventually cornered by police dogs
synonyms: drive into a corner, bring to bay, cut off, block off, trap, hem in, pen in, surround, enclose, capture, catch