PM Modi's ambitious 'Make in India' takes a hit, defence firms spurn tenders worth $15 bn

New Delhi, April 8: In a blow to Prime Minister Narendra Modi's ambitious ‘Make in India' campaign, Indian firms have declined a number of government tenders worth $ 15 billion to make a range of weapons since 2013.

Tenders of defence weapons such as air defence guns, surface-to-air missiles, transport planes have lapsed, says Defence Ministry officials.

According to news reports, these tenders totals to $ 15 billion.

Unrealistic quality demands from a military short of planes, tanks and guns are key reasons for reluctance of executives to bid for projects, says a Reuter report.

The report quoted experts saying that the military doesn't want weapons from Indian firms which have no track record in defence manufacturing.

"`Make in India` is a laudable aim, but it`s moving rather slowly. It`s not a switch you can press and everything will fall into place," Vivek Rae, head of procurement at the Defence Ministry from 2010-2012 has been quoted as saying.

PM Modi launched the "Make in India" campaign last year as the centrepiece of a project to rewrite the country's reputation as a tricky place to do business. The government has already relaxed rules for foreign investors, eager to create work for the millions who enter India's jobs market each year.

At Aero India show last month, PM said that defence is at the heart of 'Make in India' campaign and that India will have to soon give up the No 1 position as the world's largest defence importer.

"We have the reputation as the largest importer of defence equipment in the world. That may be music to the ears of some of you here. But, this is one area where we would not like to be No 1," the PM said.

Recently, Defence Minister Manohar Parrikar said that the government is committed to bring about self-sufficiency in defence sector.

Parrikar said the government was stressing on 'Make In India' in defence acquisition and promoting it in almost all defence acquisition.

Government has increased the defence budget by 9.87 per cent to Rs 2.46 lakh crore for the next fiscal as compared to the revised estimates of Rs 2.22 lakh crore for 2014-15 as it pushes 'Make in India' initiative to curtail over-dependence on imports.

Parrikar said the government's decision to increase FDI cap in the defence sector to 49 per cent will bring in techonology.

In his budget speech, Finance Minister Arun Jaitley had said the government was working towards self-sufficiency through the Make in India programme in defence equipment including aircraft.

OneIndia News
(With agency inputs)