India is Contemplating 100 per cent Foreign Direct Investment (FDI) in the defence sector to stimulate the participation of foreign companies in the manufacture of military transport aircraft, battle tanks and armoured vehicles.
Presently foreign investment is permitted only up to 49% under the automatic route and foreign investment upto 100 per cent is allowed only after government’s approval. The disadvantage of the current system is that major foreign firms stay away as they are reluctant to agree for transfer of technology.
Finance Minister Arun Jaitley, who had held a meeting with government officials recently, conducted a review of the current FDI policy, The Hindu BusinessLine reported Sunday.
The cabinet has been eyeing to liberalise the FDI regime to attract foreign investments in various sectors, including defence and retail.
The FDI policy is subject to industrial licence and such licences are granted by the Licensing Committee in the Department of Industrial Policy and Promotion (DIPP), which considers the security clearances by the Ministry of Home Affairs.
The DIPP officials maintain that FDI in defence has been slow possibly because the returns on investment and government orders. However, FDI in defence could reverse the trend of India's full dependence on imports of defense equipement.
Few critics also point out at the disadvantage that higher FDI will be a hassle in building self-reliance in the sector, and likely to hamper the country’s interests.
Few officials said that the defense sector is in urgent need of significant capital investment and infusion of technology.
Indian Navy has inducted a landing craft utility (LCU) ship L52 which will be deployed for transporting battle tanks, other heavy weapons systems besides troops. The ship, which would be based in the Andaman and Nicobar command, can also be deployed for multirole activities like search and rescue as well as disaster relief operations, Indian Ministry of defense announced Monday
Indian Army is working on a project to upgrade its Russian-origin T-90 battle tanks with next generation gun-launched missiles, replacing currently equipped laser guided INVAR missile system. “As the design of the existing INVAR missile has been maximised, both in terms of range and depth of penetration (DoP), it is imperative to upgrade it to next generation missiles with enhanced capability,” an army source associated to the project was quoted as saying by PTI Sunday
Indias defense acquisition council has sanctioned $75 million for acquiring M7N.1E gas turbine engines from Ukraine for powering two Grigorovich class frigates
Indian Defense Acquisition Council (DAC) has approved purchase of six additional AH-64E Apache attack helicopters from Boeing for $650 million. “DAC approved procurement of six Apache helicopters along with associated equipment for the army totally about $650mn,” AFP reported quoting a text message from an unnamed official Friday
Indian defense ministry has issued two requests for information to global vendors for naval utility helicopters (NUH) and naval multi-role helicopters (NMRH). The navy is planning to buy 111 NUHs and 123 NMRHs to replace older helicopters
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