License not required for parts-components manufacturing
Offset guidelines have been made flexible by allowing change of Indian Offset Partners (IOPs) and offset components, even in signed contracts by Foreign Original Equipment Manufacturers (OEMs).
The OEMs are now allowed to provide the details of IOPs and products after signing of contracts, said Minister of State for Defence Shripad Naik in a written reply Rajya Sabha on 14 Sept 2020.
In order to bring more transparency and efficiency into the Offset discharge process, “Offset portal” has been created since May 2019, he said.
An Inter-Governmental Agreement (IGA), signed in September 2019, is to enhance the After Sales Support and operational availability of Russian origin equipment currently in service in Indian Armed Forces by organizing the production of spares and components in India by Indian Industry by way of creation of Joint Ventures/Partnership with Russian Original Equipment Manufacturers (OEMs) under the framework of the “Make in India” initiative.
The IGA on “Mutual Cooperation in Joint Manufacturing of Spares, Components, Aggregates and other material related to Russian/Soviet Origin Arms and Defence Equipment” was signed at the 20th India-Russia Bilateral Summit in Sep 2019.
In Feb 2018, the Government decided to establish two defence industrial corridors to serve as an engine of economic development and growth of defence industrial base in the country. They span across Chennai, Hosur, Coimbatore, Salem and Tiruchirappalli in Tamil Nadu and across Aligarh, Agra, Jhansi, Kanpur, Chitrakoot and Lucknow in Uttar Pradesh (UP).
Defence Products list requiring Industrial Licences has been rationalised and manufacture of most of parts or components does not require Industrial License, elaborated Naik.
The initial validity of the Industrial Licence granted under the IDR Act has been increased from three years to 15 years with a provision to further extend it by three years on a case-to-case basis, Naik informed the upper house.
Under the latest Public Procurement Order 2017, the Department of Defence Production has notified list of 24 items for which there are local capacity and completion and procurement of these items shall be done from local suppliers only irrespective of the purchase value, he said.
He also highlighted that the 101 items are under import embargo. This would offer a great opportunity to the Indian defence industry to manufacture these items using their own design and development capabilities to meet the requirements of the Armed Forces in the coming years.
This list includes some high technology weapon systems like artillery guns, assault rifles, corvettes, sonar systems, transport aircraft, light combat helicopters (LCHs), radars and many other items to fulfil the needs of our Defence Services.
The Government has notified a ‘Policy for indigenisation of components and spares used in Defence Platforms’ in March 2019 with the objective to create an industry ecosystem which is able to indigenize the imported components (including alloys & special materials) and sub-assemblies for defence equipment and platform manufactured in India. #MakeInIndia #defence #procurements #imports #manufacturing #OEMs /fiinews.com
