3rd June – Defence Testing Infrastructure Scheme

Defence Testing Infrastructure Scheme (DTIS)

On 30th April 2020, the Prime Minister held a meeting with various stakeholders to discuss ways to boost the Defence and Aerospace Sector. Within a fortnight of this important meeting, the Defence Minister launched the Defence Testing Infrastructure Scheme (DTIS) at an investment of Rs 400 crores.

What is DTIS?

In order to give a boost to domestic defence and aerospace manufacturing, Raksha Mantri approved the launch of ‘Defence Testing Infrastructure Scheme (DTIS)’ with an outlay of Rs 400 crore for creating state of the art testing infrastructure for this sector.

  • The Scheme would run for the duration of five years and envisages to setup six to eight new test facilities in partnership with private industry.
  • This will facilitate indigenous defence production, consequently reduce imports of military equipment and help make the country self-reliant.
  • The projects under the Scheme will be provided with up to 75 percent government funding in the form of ‘Grant-in-Aid’.
  • The remaining 25 per cent of the project cost will have to be borne by the Special Purpose Vehicle (SPV) whose constituents will be Indian private entities and State Governments.
  • The SPVs under the Scheme will be registered under Companies Act 2013 and shall also operate and maintain all assets under the Scheme, in a self-sustainable manner by collecting user charges.

What drove the agenda behind DTIS?

  • Going ahead with the corporatisation of the Ordnance Factories – a need identified for decades and an agenda point in the 167 transformational ideas of the current Government pledged to be completed within 100 days in office.
  • Streamlining procurement procedures which refuse to shed their sub-optimality despite many an efforts through successive revision of Defence Procurement Procedure (DPP) Manuals or pushing corrections though institutional Govt-Industry interaction forums (CII, FICCI, PHD etc).
  • Carry out a focussed resource allocation; a fait accompli option in the post-Covid scenario. The aim being to ensure that pandemic notwithstanding, there is no shortfall in defence preparedness to fight ‘immediate wars’ that may be thrust upon the country.
  • Encouraging R&D and innovation as being the only route to ‘atmanirbharta’. In that, mopping up the gains of the ongoing initiative called ‘Innovation for Defence Excellence or iDEX (not elaborated further).
  • Hand-hold the defence industry through economic packages, subsidies, GST relaxations and more (hope that the talk will be walked), especially, as it relates to the Micro Small and Medium Enterprises (MSMEs) many of which (19-43%) are facing existential crises.
  • Boosting defence exports, firstly, by shunning the myth that the nation has no worthwhile defence exports and, secondly, realising that if the laudable export target of 5 billion USD by 2025 is to be realised, the private sector must be fully supported.

Analysing the DTIS –

  • DTIS marks a continuity of thought and action from the initial decision taken in July 2018 to allow the public sector test and integration facilities to be used by the private sector players.
  • The scale of DTIS is massive and in fact in conformity with the range and depth of equipment being handled or likely to be handled by the private players in times to come.
  • Also, the same is in sync with the clarion call given by the Prime Minister to boost the Defence and Aerospace Sector when much of the world is struggling out of the Covid-19 imbroglio.
  • The only challenge to the realisation of the DTIS will be system inertiain getting the approvals through the labyrinth of the bureaucratic chain, timely setting up and operationalisation of the SPV, release of funds and creation of infrastructure in a mission mode.

SourceVIF India

QUESTION – Government has decided to set up Defence Testing Infrastructure Scheme (DTIS) to create state of the art defence testing infrastructure system in India. Analyse the potential benefits of the scheme to boost the defence and aerospace sector of India.

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