After several fits and starts, Strategic Partnership model has hit a roadblock
Pravin Sawhney and Ghazala Wahab
First, there was hype. When the Defence Acquisition Council (DAC) cleared the long-overdue programme for the building of six submarines in October 2014 under Project-75India, the sentiment among the users (the Indian Navy) as well as the industry (both Indian and global) was one of well-founded optimism, anchored as it was in the belief that unlike the policy paralysis of the previous government, the new government, which took office in May 2014, meant business.
True to form, in February 2015, Prime Minister Narendra Modi inaugurated Aero India in Bengaluru, which so far was the preserve of the defence minister and declared in the presence of who’s who of the global defence industry that defence manufacturing was at the heart of his vision of ‘Make in India.’ The excitement shot through the roof, or, rather given the ambience, through the aerobatic displays at Yelahanka.
He also announced that his government would soon release a new Defence Procurement Procedure (DPP) policy which, in addition to simplifying the earlier procedures, would facilitate greater indigenisation and ‘level-playing field’ for the private sector so that from the ignominy of being one of the largest importers of military hardware, India could take its place of pride in the hallowed portals reserved for the exporters of defence equipment.
The new DPP came along the following year after severe brainstorming by a specialised committee led by a retired bureaucrat Dhirendra Singh. Given the time the new committee took to give its recommendations to the government led to the speculation that something earth-shattering was afoot. As it turned out, the government accepted only three recommendations of the Dhirendra Singh Committee, of which one was deferred when defence minister Manohar Parrikar was asked to announce it at the inauguration of DefExpo 2016 in Goa.
In real terms, DPP 2016 was a mere improvisation on its earlier version, DPP 2013. The only distinctive addition was the introduction of the new category of procurement, called Buy IDDM — Indian designed, developed and manufactured — equipment. The government made it known that the Buy IDDM would now be the most preferred category for procurements, instead of earlier ‘Buy Indian’ and ‘Buy and Make’.This was a huge leap of faith given India’s poor record in research and development. Incidentally, this malady afflicts all sectors and is not limited to defence alone. Hence, for the government to say that Indian-designed and developed equipment would be preferred over others reflected an aspiration rather than a policy.
However, before anyone thought that doors were being closed on the foreign original equipment manufacturers, it was clarified that ‘Buy IDDM’must have at least 40 per cent indigenous content, or 60 per cent indigenous content if the product was not designed and developed in India.
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