Defence Production Policy, 2018 has set ambitious goals for the year 2025 which includes around Rs 1,70,000 crores worth of defence production, Rs 35,000 crores of defence exports and an investment to the tune of Rs 70,000 crores, thereby, creating more than three million jobs domestically and achieving global leadership in cyberspace technology and artificial intelligence.
Actions by government
- It has identified over 13 product categories and permitted 74 percent FDI in ‘niche’ technologies.
- The government also plans to develop two defense production corridors (including private sector units) and the establishment of defense innovation hubs.
- It is the manufacturers, not the Government who will decide technology transfer issues which are generally based on political and military considerations i.e. geopolitical factors and long-term business commitments.
- Even if defence technology transfer agreements are made, certain technology transfers are closely guarded and the foreign companies are not comfortable with it under any circumstance.
- Government cannot also assure them for further orders in the future due to obvious reasons. Therefore, the FDI route is not the panacea for all the ills that plague our self-reliance goals in defence production.
What can be done?
- Both public and private industry will have to invest in R&D to be able to meet the next generation requirements and design the products and systems to meet our current and future needs.
- It is also required that both research and development and manufacturing of the products are done under the same roof to prevent loss of technology to unauthorised hands.
Role of DRDO
- As the private sector lacks domain knowledge, capability, expertise, skill and experience in terms of manpower, specialised test facilities and test ranges, therefore, it is quintessential to seek help from an organisation like the DRDO.
- Government may allow private industry to indulge in sub-contracting for certain sub-systems to DRDO staff and their laboratories on deputation basis in return for a handsome payment.
- We can also allow transfer of technology by DRDO to such private companies on the terms that research and development and upgradation for the future generations of the transferred technologies must be done by themselves and that too indigenously with proper regulation to prevent export of technology.
- In the next few years, some DRDO scientists may establish their own private industries or get absorbed by the private industry after getting required experience from the DRDO.
- Armed forces should also fund the development of new products from their own budgets to give them a sense of ‘ownership’.
- DRDO may also involve institutes of importance, universities and research laboratories to become an expert organisation like the one in America i.e. DARPA.
Defence Production Policy 2018 needs a concerted effort of the government, private industry and research organisations in partnership with the universities to make the desired objectives a reality.
Source – The Hindu Business Line
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