Indigenous manufacture of defence equipment needs policy reform

Davinder Kumar and Gurmeet Kanwal

October 09, 2014

http://idsa.in/idsacomments/Indigenousmanufactureofdefenceequipment_gkanwal_091014.html

Soon after approving 49 per cent FDI in the defence sector, the Prime Minister, exhorted the nation to create a viable “defence industrial base” with “indigenisation” as the mission. He launched a “make in India” drive and expressed his government’s intention to permit defence exports.

The long-pending Request for Proposal (RFP) for light helicopters was cancelled by the government and the Defence Minister directed that the helicopters be manufactured in India with appropriate technical collaboration. Now, the Department of Industrial Policy and Promotion (DIPP) has cleared 19 granted industrial licences to 19 private sector proposals and declared that 14 other pending proposals do not need clearance as the manufacture of a large number of defence items has been de-licensed.

All of these are bold steps which send a powerful message and indicate that the much needed “political will” for self-reliance in defence manufacture is no longer lacking. Its translation into action will involve the transformation of the policy framework and procedures to help indigenous defence manufacturers to flourish.

Historically, despite the fact that India participated in both the World Wars and lost over a quarter million soldiers, the country was denied a viable defence industrial base by our erstwhile rulers. Sadly, we have not been able to improve the situation even 67 years after independence. Our 39 ordnance factories are still designed mainly to manufacture only low-end items like clothing, tents, accoutrements and small arms ammunition.

The situation with regard to our nine Defence PSUs is also not very encouraging considering the huge investments made by the nation. Fifty plus DRDO laboratories also do not inspire much confidence when it comes to the development of weapons technology, its engineering into production and system integration. This situation must change, but where have we gone wrong and what do we need to do?

Successive governments from 2001 onwards appointed high-powered committees headed by eminent persons to make recommendations with regard to organisational transformation, in-house development of technology and related reforms to involve the private sector in defence production on equal terms. Seven committees have submitted their reports since then. Unfortunately, even the common recommendations made by them have not been implemented. This is primarily due to bureaucratic lethargy and inadequate public scrutiny.

National security has been treated as a holy cow on the plea of the need for secrecy and the “people” have not been involved in decision making. In a democracy, people’s participation is necessary to justify the budget and establish accountability. We need to build “national security awareness” among the people and create the requisite environment for meaningful interaction between decision makers, manufacturers and the people. Secrecy cannot be an excuse to hide lack of accountability, slippages in the production schedules and escalation of cost. People need to know where and how their money is being spent and be reassured that it would ensure both human security and national security.

Institutions like the Standing Committee for Defence in Parliament require transformation. India must study the Chinese concepts of “leap frogging” of technology across several generations and “civilianisation” to exploit dual use technology. We will have to modify these concepts to suit our conditions and set up a viable defence Industrial base by the end of this decade. Those who exclusively promote imports should be guarded against.

The Department of Defence Production must be made a separate entity under a cabinet minister with indigenisation and modernisation of existing R&D and the manufacturing assets as its primary responsibilities. The three Services and the private sector must be integrated with this Department with appropriate representation. The DRDO, suitably reorganised, should also be part of this organisation. The Scientific Advisers to the three Chiefs must be made more accountable. The Army and the Air Force must have integral design and development organisations like the Navy’s Weapons Engineering Electronics Systems Establishment (WEESE).

It would be beneficial to establish a Defence Technology Mission (DTM) and a Project Implementation Agency (PIA). The DTM must develop and hunt for technology in consonance with the concepts of “leap frogging” and “civilianisation” of dual-use technologies and should be placed under the PMO. The PIA should report to the Defence Minister and ensure “on time” execution of all projects without cost overrun. A separate Class A service needs to be raised as a Defence Technology cadre for the MoD and our embassies and missions. It should have linkages with major academic and R&D institutions in the country and abroad.

India needs to follow a multilateral approach for technology development that has synergies with our “centers of excellence”. We need to work concurrently on local R&D, technology transfer to include “know why”, co-development and co-production, reverse engineering, exports and harnessing of dual-use technology. We need to encourage innovation and establish “technology incubators”, particularly in information and communication technology (ICT) and cyber domains.

While the PM has displayed the necessary political will for indigenisation and establishment of an advanced manufacturing base in the country, the challenge lies in its comprehensive implementation. That requires an enabling policy framework, focus, commitment, pride and a never say die spirit.

A National Security and Strategic Review should be regularly presented in Parliament prior to discussions on the defence budget, just like the Annual Economic Survey is released before the presentation of the Finance Bill.

The PM and the CCS should be briefed every quarter on the status of indigenisation, technology and infrastructure by the Defence and Home secretaries. These briefings should be attended by the three Chiefs and the CDS when appointed.

In the beginning of each financial year, the government must bring out a comprehensive White Paper on national security to include security environment scan, budget, technology, state of major projects, development of human resources, major acquisitions and technology absorption and progress on infrastructure projects.

We need to demonstrate the same resolve, unity, sacrifice and sense of purpose that we exhibited during our freedom struggle and launch a movement for the development of “swadeshi” technology to build the India of our dreams: self-reliant, strong, prosperous and peaceful.

Lt Gen Davinder Kumar (Retd) is former Signal Officer-in-Chief. Brig Gurmeet Kanwal (Retd) is former Director, Centre for Land Warfare Studies, New Delhi.

Views expressed are of the author and do not necessarily reflect the views of the IDSA or of the Government of India