Article Posted on : - Jan 13, 2015

GANDHINAGAR (PTI): Defence Minister Manohar Parrikar recently said government proposes to come up with an industry friendly policy on defence manufacturing and procurement in 2-3 months, a move aimed at promoting local production and reducing imports.

Speaking at a seminar on the sidelines of Vibrant Gujarat Summit here, he said a USD 20 billion import bill for defence was not affordable.

"Such a huge import bill has undesirable consequences for the economy, development and unemployment in the country," he said, adding that for strategic reasons too the country should not be dependent on defence imports.

In the light of this background, the Minister said, the "government hopes to come up with a document in 2-3 months on a suitable model for defence manufacturing and procurement".

He said defence manufacturing will get a major thrust in line with 'Make in India' policy.

He also stated that his ministry would soon be in a position to decide which items should be manufactured in India and gradually that list would be increased over a period of time.

Later talking to PTI, Parrikar said the Defence Procurement Procedure (DPP) 2015 will have an "industry friendly" approach for defence production.

India has recently taken steps like relaxed foreign direct investment norms to boost local manufacturing.

Observing that there are "some gaps" in the current DPP, he said "since we are the only consumer and the buyer so whenever you deal with anyone there has to be guarantee of purchase from Make in India. Unless, you guarantee a purchase on successful production, there is no chance of anyone coming forward".

Current policies, Parrikar added, are "too cumbersome and bureaucratic nightmare" for the industry and needs to be reviewed.

He hoped that with change in the business climate and setting up of new guidelines and principles, the process of local investment will start.