The Defence Minister said the decision would offer a great opportunity to the Indian industry to manufacture the items in the negative list
The Ministry of Defence will “introduce import embargo on 101 items beyond given timeline to boost indigenisation of defence production”, Defence Minister Rajnath Singh announced through a series of tweets on Sunday.
Speaking at a function later in the day, Mr. Singh said the government intends to reach a turnover of $25 billion through indigenously manufactured defence products and also expects to export products worth $5 billion.
“Government has also decided that in any government contract over ₹200 crore, no foreign company can participate in the tendering process….we will help Indian defence manufacturers… This year ₹52,000 crore items to be bought only from Indian companies,” Mr. Singh said in an online interaction.
He added that the government will push the Swadeshi movement started by freedom fighters and Mahatma Gandhi during the Independence Movement.
“In his address to the nation on August 15, Prime Minister Narendra Modi will present the outline for a self-reliant India,” he added.
The policy change comes in the wake of Chinese transgressions and build-up along the Line of Actual Control (LAC) in Ladakh. China has refused to pull back forces from several areas. It amassed troops since May this year and has refused to vacate areas along the undefined border that were traditionally patrolled by the Indian army.
“The Ministry of Defence is now ready for a big push to #AtmanirbharBharat initiative. ….Taking cue from that evocation, the Ministry of Defence has prepared a list of 101 items for which there would be an embargo on the import beyond the timeline indicated against them. This is a big step towards self-reliance in defence. #AtmanirbharBharat,” Mr. Singh said in his Twitter series.
He said the decision will offer a great opportunity to the Indian defence industry to manufacture the items in the negative list by using their own design and development capabilities or adopting the technologies designed and developed by the Defence Research Development Organisation (DRDO) to meet the requirements of the Armed Forces.
“The list is prepared by MoD after several rounds of consultations with all stakeholders, including the Armed Forces, public & private industry to assess current and future capabilities of the Indian industry for manufacturing various ammunition & equipment within India,” Mr. Singh said.
He added that almost 260 schemes of such items were contracted by the Tri-Services at an approximate cost of ₹3.5 lakh crore between April 2015 and August 2020. It is estimated that contracts worth almost ₹4 lakh crore will be placed with the domestic industry within the next 6 to 7 years, he said.
“Of these, items worth almost ₹1,30,000 crore each are anticipated for the Army and the Air Force, while items worth almost ₹1,40,000 crore are anticipated by the Navy over the same period,” the Minister said.
The list of 101 embargoed items comprises of not just simple parts but also some high technology weapon systems like artillery guns, assault rifles, corvettes, sonar systems, transport aircrafts, LCHs, radars and many other items to fulfil the needs of the defence Services, Mr. Singh said.
The list also includes wheeled Armoured Fighting Vehicles (AFVs) with indicative import embargo date of December 2021, of which the Army is expected to contract almost 200 at an approximate cost of over ₹5,000 crore.
“The embargo on imports is planned to be progressively implemented between 2020 to 2024. Our aim is to apprise the Indian defence industry about the anticipated requirements of the Armed Forces so that they are better prepared to realise the goal of indigenisation. MoD has also bifurcated the capital procurement budget for 2020-21 between domestic and foreign capital procurement routes. A separate budget head has been created with an outlay of nearly ₹52,000 crore for domestic capital procurement in the current financial year,” the tweet said.