Government must nurture a private sector defence industry

At a recent CII seminar Gen Vij, India’s Army chief has indicated the

areas of focus for the future are on long range, lethal and precision guided munitions, merger of the delivery system and warhead into one integrated or cohesive unit, mobile weapons systems, reconnaissance, surveillance and target acquisition systems, ability to operate at night and in bad conditions and communications and information management systems to optimally link sensors to the shooters.

As I’ve argued before, the government must take proactive measures to nurture a strategic private sector defence industry. At the very minimum it must study how it can procure equipment and materiel from domestic producers, but not at the cost of sacrificing quality at the altar of domestic self-sufficiency. Recently, the Army has procured jeeps from Mahindra & Mahindra which have performed satisfactorily.

Moving beyond, the Indian government must create and develop a cluster of private producers of defence systems, hardware and software – both for domestic use as well as for export. For a start, the existing defence equipment producers – run as opaque public-sector units – must be corporatised and eventually sold off to private industry. I may be arguing for too much in a time where divesting the state oil company is caught up in histrionics, but it is necessary for the defence industry to keep pace with the rapidly evolving requirements of India’s armed forces. A well run, competitive defence industry will be in India’s strategic interest.