India orders $18.7b worth of military hardware

An Indian Army T90 tank drives past during the nation's Republic Day Parade in New Delhi on January 26, 2015.

Indian Air Force, Army and Navy have placed orders worth Rs 83,858 crore (S$18.7 billion) from 2011 to the last fiscal while domestic defence industries have earned Rs 69 crore by export of military hardware.

Defence Minister Manohar Parrikar said foreign vendors got orders worth Rs 55,406 crore from IAF between 2011-12 and 2013-14 followed by Navy's Rs 25,454 crore and Rs 2,998 crore from Army.

Replying to questions in the Lok Sabha, Parrikar also said that Foreign Direct Investment amounting to Rs 24.36 crore has been received after government opened the defence industry for private sector.

"The expenditure on capital acquisition in respect of orders placed on Indian vendors and foreign vendors during the period 2011-12 to 2013-14 was 53.9 per cent and 46.1 per cent respectively," he said.

Giving details of efforts by the government to strengthen the domestic defence industry, he said a total of 144 companies have been issued licences and letters of intent for manufacture of military hardware in the last 14 years.

He said 29 joint ventures and FDI proposals have been approved while noting that the procedure for 'Buy and Make (Indian) and Make' categories of acquisition over 'Buy (global)' category to encourage Indian defence industry.

As per the new FDI policy in defence, foreign investment up to 49 per cent has been allowed through FIPB (Foreign Investment Promotion Board) route and beyond 49 per cent, with the Cabinet Committee on Security.

The Defence Minister said Indian private sector industry has also been allowed to receive Maintenance Transfer of Technology (MToT) in 'Buy (global)' cases.

He also said that an online system of receiving application for issue of NoC for export of military stores has been introduced besides formulating a defence export strategy.

Parrikar said during the last four years, NoCs for export of goods which are in the nature of military stores have been issued for many countries including Algeria, Nigeria, Bosnia and Herzegovina, Sri Lanka, Paraguay, Japan, Afghanistan, Spain, Nepal, Belgium, Malaysia, Norwat, Romania and Port of Spain.