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Defence Exports on Rising Trajectory

The Indian defence export's graph has started mounting year-on-year. On one hand it is good for the country's foreign reserves; on the other hand it will surely benefit manufacturers as requirements of the Indian Armed Forces alone are unlikely to provide the economy of scale.

Increasing defence exports by leaps and bounds has become essential for India to achieve the target of making the country enter into the league of one of the world's top five defence producers, with an annual turnover of USD 26 Billion (Rs 180000 Crores). Currently, defence production is a mere Rs 90000 Crores per year and doubling this would require multiplying of exports. The recent measures adopted by the Government to boost defence exports include:-

  • India made a pitch for Indian defence and aerospace products and to facilitate sales and has offered friendly foreign countries such as Myanmar, Maldives and Sri Lanka “credit lines” for purchasing Indian defence equipment.
  • The Defence Public Sector Undertakings (DPSUs) have been given export targets of 25% of their turnover.
  • Setting up of the Indigenous Defence Equipment Exporters Association (IDEEA), a nodal agency for exports, for processing defence exports inquiries from prospective customers across the globe.
  • A liberalized trade environment for Indian defence exports has also been facilitated by obtaining entry into the four global export control regimes i.e., Missile Technology Control Regime, the Wassenaar Arrangement and the Australia Group, while entry into the fourth the Nuclear Suppliers Group, is also in pipeline.

The Defence Ministry must ensure the Defence Forces induct indigenous weaponry into service, working with industry to incrementally develop and improve the products, even as the resulting exports create economy of scale, bring down equipment prices and generate strategic heft for India. The country's defence exports have witnessed an increase of nearly seven-fold in the last two years from Rs 1521 Crores in 2016-17 to Rs 10745 Crores in 2018-19. The export of civil aerospace products to that of defence kit, the export figure has reached a high of Rs 10745 Crores in 2018-19.

Some of the export products that the Indian Government has authorized Indian authorities to export include helmets, bomb suppression blankets, soft armour panels and cartridges to Germany; export of mine-protected vehicles, over-vests, helmets, soft armour panels, and civil helicopter protection equipment to the United Arab Emirates (UAE). Further, power supplies, bulk memory control cards, are amongst the equipments that are to be exported to Sri Lanka from India. Radar distribution cards, amplifiers and spare parts for radar systems are among the devices that have been authorized for export to Singapore. Refer Table for list of products that are exported from India to foreign countries.

With this kind  of initiative now there is requirement emphasizing the change from exporting low-value ammunition, spares and aerospace components to the export of high-value, complex combat platforms such as the Tejas fighter, Dhruv and Rudra helicopters, the Arjun tank, Akash air defence systems, Pinaka rocket launchers and a range of indigenous warships including corvettes, frigates and destroyers. India also authorized the export of Dornier Do 228 aircraft and coastal surveillance systems to Seychelles.

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