US tops list of defence pacts between India and foreign firms in two years

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The United States (US) tops the list of foreign countries with which India has signed contracts for procurement of weapons and military platforms in the last two years. This is followed by Israel, Britain and then Russia.

In reflection of rapid transformation in India’s arms procurement, Russia was in the fourth place in terms of number of contracts signed during the period.

Replying to a question in Lok Sabha, Minister of State for Defence Subhash Bhamre said a maximum of nine contracts were signed with American companies while seven pacts were signed with Israeli firms, five with Britain and four with Russian defence majors. The number of contracts signed with Germany and Sweden were three each followed by France with two.

The minister said 94 contracts involving Rs 82,979 crore have been signed with Indian vendors for capital procurement of defence equipment in the last three financial years. He said the Defence Production Policy promulgated by the government aimed at achieving substantive self-reliance in the design, development and production of weapon systems and platforms.

Bhamre said in order to promote indigenous design and development of defence equipment, a new category of procurement ‘Buy (Indian-Indigenously designed, developed and manufactured)’ has been introduced in DPP and the same has been accorded top most priority for procurement of capital equipment.

“The ‘Make’ Procedure has been simplified with provisions for funding of 90 per cent of development cost by the government to Indian industry for design, develop and manufacture of defence equipment,” he said.

He said industrial licensing regime for Indian manufacturers has been liberalised and most of the components, parts and sub-systems have been taken out from the list of defence products requiring industrial licence.

“This has reduced entry barriers for new entrants in this sector, particularly SMEs. The initial validity of Industrial Licence has been increased from 3 years to 15 years with a provision to further extend it by 3 years on a case to case basis,” he said.

Issues related to level-playing field between Indian and foreign manufacturers, and between public sector and private sector have also been addressed. “These include Exchange Rate Variation (ERV) protection for all Indian vendors, removing anomalies in customs/ excise duty etc,” Bhamre said.

(With PTI Inputs)

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