MSMEs can capitalise on the opportunities presented by the Strategic Partnership Model
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Bedrock Gets Its Due

MSMEs can capitalise on the opportunities presented by the Strategic Partnership Model

Nirupama Soundararajan and Dnyanada Palkar

The Indian defence manufacturing sector comprises defence public sector undertakings (DPSUs), ordnance factories (OFs) and private players including domestic and foreign companies. A sizeably large and disaggregated defence micro, small and medium enterprises (D-MSMEs) form the bedrock of indigenous defence production.

Of all the contributors to the Indian defence production supply chain, D-MSMEs have been continuously overlooked and their contributions underestimated. Thankfully, this narrative has changed. The ‘Make in India’ initiative of the Modi government places MSMEs at centre-stage for enabling domestic manufacturing. The ‘Make in India’ defence initiative, places its confidence in D-MSMEs for building self-reliance in indigenising domestic defence production and manufacturing. This vision, however, needs enabling policy.

In the recent past, two significant reports, the Dhirendra Singh Committee Report (Committee Report) and the V. K. Aatre Taskforce on Strategic Partnerships (Taskforce Report), have been instrumental in bringing D-MSMEs into the main narrative. Both, Committee Report and Taskforce Report, recognise the importance of D-MSMEs in the defence industry ecosystem.

The Dhirendra Singh Committee was given the mandate of suggesting amendments to the Defence Procurement Policy (DPP) 2013 and create enabling guidelines for the implementation of the revised version – the DPP 2016. DPP 2016 is the first policy on defence production in which MSMEs have found mention. The Committee also recommended the setting up of an independent taskforce that would examine how to increase private sector participation in domestic defence manufacturing.

Prime Minister Narendra Modi
Prime Minister Narendra Modi releasing the brochure at the inauguration of the ‘Make in India’ in September 2014

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