{"id":197776,"date":"2022-07-29T09:52:20","date_gmt":"2022-07-29T04:22:20","guid":{"rendered":"https:\/\/blog.forumias.com\/?p=197776"},"modified":"2022-07-29T09:52:20","modified_gmt":"2022-07-29T04:22:20","slug":"hitting-the-mark-on-defence-exports","status":"publish","type":"post","link":"https:\/\/forumias.com\/blog\/hitting-the-mark-on-defence-exports\/","title":{"rendered":"Hitting the mark on defence exports"},"content":{"rendered":"\n

Source:<\/strong> The post is based on an article \u201cHitting the mark on defence exports\u201d published in the Business Standard on 28th<\/sup> July 2022.<\/p>\n

Syllabus<\/strong>: GS 3 Effects of Liberalization on the Economy, Changes in Industrial Policy and their Effects on Industrial Growth.<\/p>\n

Relevance<\/strong>: Defence Sector and Defence Export<\/p>\n

News<\/strong>: Recently, the Naval Innovation and Indigenisation Organisation Seminar Swavlamban<\/strong> was organized in New Delhi. Prime Minister (PM) reiterated the government\u2019s will to move out of India\u2019s addiction to defence imports and turn it into an exporter of military equipment.<\/p>\n

In 2020, the PM has set the five-year defence exports target of Rs 35,000 crore.<\/p>\n

To fulfil the target, the MoD may launch 75 items in the fields of unmanned systems, robotics, intelligent surveillance and more to propel India. The government<\/p>\n

Approximately half and one-fourth of India\u2019s defence exports between 2017 and 2021, were to Myanmar and Sri Lanka, respectively.<\/p>\n

During FY21, the US became India\u2019s biggest customer in terms of defence export.<\/p>\n

Other major regions to which Indian exports were headed were South-East Asia, West Asia and Africa.<\/p>\n

Status of India\u2019s defence export<\/strong><\/h5>\n

The defence exports are hitting an all-time high of Rs 13,000 crore during FY21-22. Further, the share of the private sector accounts for 70% of the exports.<\/p>\n

The items exported comprises advanced light helicopters, missiles, offshore patrol vessels, surveillance systems, personnel protective gear, and various types of radars.<\/p>\n

What are the drivers of Indian defence exports?<\/strong><\/h5>\n

First,<\/strong> the government has taken various steps like simplified industrial licensing, easing of export restrictions, and issuance of no-objection certificates (NOC).<\/p>\n

Second<\/strong>, in the post-2014 period, a separate defence export strategy <\/strong>was prepared. It focussed on export promotion or facilitation and export regulation.<\/p>\n

Third<\/strong>, the Ministry of External Affairs has supported the creation of lines of credit (LOC)<\/strong> for countries to import Indian defence products. In the Indian missions abroad, the defence attaches were established, authorised to encourage Indian exports.<\/p>\n

Fourth, <\/strong>the Defence Production and Export Promotion Policy 2020<\/strong> pushed for exports. It mandates public sector undertakings to derive at least 25% of their revenue from exports, including success fee by 2025.<\/p>\n

Sixth,<\/strong> the Defence Expo <\/strong>and Aero India<\/strong> are organized to exhibit India\u2019s defence production capacity.<\/p>\n

Seventh,<\/strong> the Department of Defence Production<\/strong> focus on time-bound export clearances.<\/p>\n

What are the factors retarding the growth of Indian defence exports?<\/strong><\/h5>\n

There are various factors which have long hampered the indigenous manufacturing in India and may make it difficult to achieve the target of Rs 35,000 crore.<\/p>\n

First set of issues:<\/strong> like absence of critical technologies, the long gestation period involved in creating a capital and technology-intensive production base, conducting business operations is difficult due to stringent labour laws<\/strong> and compliance burden, inadequate funding of defence research and development (R&D), and the lack of engineering and research skills.<\/p>\n

Second set of issues:<\/strong> like poor designing capacity in core technologies, insufficient finance of R&D, and the incapability to produce critical subsystems and components.<\/p>\n

Third set of issues:<\/strong> there is an adverse skill gap at present, due to weak industry-academia interface.<\/strong><\/p>\n

What should be done?<\/strong><\/h5>\n

India should tap the right opportunities by smartly utilising our existing competitive advantages.<\/p>\n

There are various prevailing cost advantages <\/strong>in various lines of indigenous defence production.<\/p>\n

India can explore export opportunities in the African countries<\/strong> like Algeria, Morocco and Angola; and the West Asian <\/strong>countries like Saudi Arabia, the UAE and Qatar.<\/p>\n

India should explore defence markets in the Indian Ocean Region <\/strong>and work upon the Neighbourhood First policy<\/strong>. This can be enabled through lines of credit to India\u2019s neighbours<\/strong> like Maldives, Bangladesh and Myanmar<\/p>\n

Basket of items to start from<\/strong>: Initially focus on exports of items such as the BrahMos cruise missile, Pinaka multi-barrel rocket launcher, the advanced light helicopter Dhruv and the Akash air-defence system. Further, India should move towards providing end-to-end defence solutions<\/strong> in the long-run.<\/p>\n","protected":false},"excerpt":{"rendered":"

Source: The post is based on an article \u201cHitting the mark on defence exports\u201d published in the Business Standard on 28th July 2022. Syllabus: GS 3 Effects of Liberalization on the Economy, Changes in Industrial Policy and their Effects on Industrial Growth. Relevance: Defence Sector and Defence Export News: Recently, the Naval Innovation and Indigenisation… Continue reading Hitting the mark on defence exports<\/span><\/a><\/p>\n","protected":false},"author":10320,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[1230,9],"tags":[10503,216],"class_list":["post-197776","post","type-post","status-publish","format-standard","hentry","category-9-pm-daily-articles","category-public","tag-business-standard","tag-gs-paper-3","entry"],"jetpack_featured_media_url":"","views":{"total":0,"cached_at":"","cached_date":1700293369},"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/197776","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/users\/10320"}],"replies":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/comments?post=197776"}],"version-history":[{"count":0,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/197776\/revisions"}],"wp:attachment":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/media?parent=197776"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/categories?post=197776"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/tags?post=197776"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}