Indian defence industry capable of developing futuristic weapons & systems, says Rajnath Singh at 'Invest for Defence' investor outreach event during DefExpo 2022
Aim is to increase defence production to $22 billion by 2025: Defence Minister
Defence Minister Rajnath Singh invited investment from domestic industry and Foreign Original Equipment Manufacturers (OEMs) in the Indian defence sector and take advantage of the opportunity to integrate global supply chains, during the 'Invest for Defence' investor outreach event organised as part of 12th DefExpo in Gandhinagar, Gujarat on October 20, 2022.
Commenting on the enthusiastic participation of domestic industry and businesses, the Defence Minister said the trust of the industry stakeholders is encouraging and reflects their faith in the Indian defence sector. He added that this is a golden period for Indian Defence Industry, which will be a sunrise sector in the years to come. Sharing the government's future plans for the defence sector, he asserted that the target is to increase defence production in India from $12 billion to $22 billion by 2025. This provides unparalleled opportunities for growth to industry in the coming years, he added.
Rajnath Singh questioned the earlier view that there is a dichotomy between economic development and security, saying that they are complementary. He mentioned that this approach has changed in the past few years and now these two concepts are integrated, and they strengthen each other. "Today, the nation is integrating and moving forward with these two capabilities, which complement each other, and making unparalleled improvements in both," said Rajnath Singh. He added that economic and strategic capabilities are essential for development of science and technology, health, agriculture, trade and commerce.
Speaking on the achievements of the Indian Defence industry, the Defence Minister said the domestic industry has demonstrated its capabilities by building Fighter Aircraft, Aircraft Carrier, Main Battle Tanks and Attack Helicopters and gained experience to build an ecosystem through these projects. "This experience will help in supporting and developing defence weapons/systems for future generations", he added. He termed DefExpo 2022 as an excellent platform for existing and prospective investors to become a part of the phenomenal growth of the Indian defence industry.
Rajnath Singh highlighted that it is natural for investors to look for profit and offered a value proposition to investors in the Indian Defence Industry. He said the country has a skilled human resource and a healthy population and the government has taken several steps to strengthen this aspect. He spoke about the financial measures that have enabled banks to give loans and boost capital availability and led to establishment of a venture capital funding culture.
In the field of technology, the Defence Minister added that the government has improved lab to industry linkage for organisations such as CSIR and DRDO and introduced initiatives such as Innovations for Defence Excellence (iDEX) and Technology Development Fund to provide financial support for upgradation and innovation in products, systems, processes for the Armed Forces. Foreign Direct Investment norms in the Defence sector have been liberalised to 74% through the automatic route, and 100% through government route and trading in stock markets has become transparent, which has also benefited defence companies, he said.
Rajnath Singh added that the government has dedicated one fourth of the Defence R&D budget to industry led R&D to encourage private players in the defence sector. He stated that providing markets to industry is part of the Government's commitment to build an 'Aatmanirbhar Bharat' and work is being carried out to provide market access to the domestic industry. "To increase the participation of domestic industry in the defence sector, the government has reserved 68% of the defence capital acquisition for domestic procurement for the year 2022-23, which is approximately 85,000 crores and 25% of this has been reserved for domestic private industry", he said.
The Defence Minister stressed that all these measures have yielded results in increase in defence exports in the past few years. He ended his address by expressing confidence on the unlimited possibilities of growth of the Indian Defence Industry and invited businesses to invest in the sector.
'Invest for Defence', the first ever marquee event of Ministry of Defence, was targeted to promote investment in the defence sector in the country both by the Indian industry as well Foreign OEMs. It highlighted the requirements of the Armed Forces and policy reforms undertaken by the Government for ease of doing business in the defence sector. It provided the industry with the opportunities and the advantages of investing in the sector and thus contributing to maximising the indigenous production.
The event featured a panel discussion between the industry stalwarts and the MoD and Armed Forces leadership. A B2B interaction among the OEMs, including both DPSUs and foreign OEMs, was also held. It was enthusiastically received by domestic businesses, MSMEs and industry representatives in attendance. Officials from Ministry of Defence, central and state government were also in attendance.