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DefINsights - Sugosha Newsletter Jan 2018

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Published by , 2018-01-14 08:51:43

DefINsights - Sugosha Newsletter Jan 2018

DefINsights - Sugosha Newsletter Jan 2018

A SUGOSHA PRESENTATIONDefInsightsVOL.1ISSUE8~JANUARY2018

EXCLUSIVE INTERVIEW

CAPABLE OF MEETING
CHINA’S ‘NO CONTACT
WAR’: GENERAL RAWAT

ARMY DAY SPECIAL

CONTENTS

THE LEADERSHIP 08

DEFENCE
MINISTER’S
SCIENTIFIC
ADVISER BAGS
DESIGN AWARD

EXCLUSIVE INTERVIEW 09

HOKE HOI NA? 18
HO! HO! HO!

MONEY MATTERS

ROLE AND
EXPECTATIONS
13 FROM THE
POLICY ANALYSIS DEFENCE BUDGET

TRANSFORMATIONAL FOR FY19

REFORMS IN DEFENCE
PRODUCTION
Editor: N.C. Bipindra

CEO SPEAKS

The Good, Credible News!

Sugosha Advisory was founded in April 2017 to become a credible advisory for the industry, foreign and
domestic alike. The idea was to reach out to the industry at large and integrate them into the mainstream.
We draw inspiration from the greatest epic of all time, ‘The Mahabharata’, to follow the path of ‘Dhar-
ma’ (righteousness) and ‘Karma’ (Duty) as the divine diktat. Hence, we have named our company after
the Conch (Shank) of Nakula, the fourth in the chronological order of birth among the five Pandava
brothers.
Nakula, with his extreme intelligence and foresight, was also the Military Advisor to the Pandava leader-
ship during the Kurukshetra war, and so, we would like to provide advisory to the industry through our
ability to understand policies and interpret them to the best advantage of the government and the industry.
An incredible journey in the year 2017 was preceded by high-level policy changes, with a holistic view.
The government of the day has addressed the concerns of the industry with a new Defence Procurement
Procedure (DPP 2016), a dynamic FDI policy, a liberal licencing regime, and a simplified online ex-
ports clearance process while bringing about an attitudinal
change in the government offices.
If I say that the government offices have got a fresh breath
of air, a more positive attitude, and a mission-oriented func-
tioning, it may not be an overstatement.
The industry landscape has undergone a change in the
last four years. The large business houses with a strategic
outlook like the Adanis have bitten the defence sector bul-
let. The Anil Dhirubhai Ambani Group, The Aditya Birla
Group, Stumpp Schuele & Somappa (SSS) Group, and many more have donned the big boots, getting
armed with international relationships with original equipment manufacturers like the SAAB, the CBK,
the Dassault, the ELBIT, the Lockheed Martin, and many more; while preparing for the long-haul In-
dian transformation.
This is a great sign for the industry, which was hitherto limited to the bigwigs like the L&T, the Tatas,
the Mahindras, Bharat Forge and others. So, the dynamics are changing. What the Apple (soon aspiring
to be the first trillion-dollar company) has done to the handphone could be re-enacted by the Adanis,
Ambanis, Birlas, SSS and other new entrants in India for the defence sector.
Dr Subhash Bhamre, the junior defence minister of India, has stated on the floor of parliament that the
government has signed 187 contracts for Rs 240,000 crores. This bit of news is, indeed, encouraging. The
question is: Is this good enough?
Rapid developments in the neighbourhood call for concerted action. Why has China, for example, been
so successful in creating and now sustaining a formidable defence industry? Why have they moved
away from the SOEs (State Owned Enterprises) to MOR (Mixed ownership reform), akin to our PPP
model that has shown the path to progress? China has the advantage of not being a democracy and can
implement path-breaking reforms in any manner they want.
India, being a democracy, cannot become a limitation for progress. Democracy does confer the right to
individuals to speak freely, but not to stall programmes. The Ministry of Defence has the stakeholders
(the Indian armed forces, industry, and to an extent, the DRDO) and the non-stakeholders (the Finance
department, the administrative department and the others). While the stakeholders are affected by ei-
ther the induction or non-induction of platforms and systems, it does not affect the non-stakeholders
in any manner.

January 2018 | DefInsights | 3

CEO SPEAKS

In fact, the non-stakeholders may even get promoted to effectively stalling the programmes. This attitu-
dinal deficiency in public offices of responsibility must change. Providing military platforms to the Indi-
an armed forces is a national call. The problem is global, and every common citizen is directly affected.
The Indian armed forces are the last resort of the civilian administration and they simply must succeed
every time when they are faced with the worst situations.
Despite the inherent problems in a democracy, the MoD has been able to bring about reforms at such a
rapid pace, that could pleasantly surprise the pessimists. While, on the other hand, the implementation
has been so pathetic that it shocks the optimists. Implementation is the key.
Nirmala Sitharaman as our Defence Minister has sent positive vibes at all levels - be it on cadre parity,
launching indigenous programmes, simplifying the ‘Make’ defence procurement procedure, opening
the ammunition production to the private industry, placing orders on HAL for 83 Tejas Mk1A, taking
action to close the large ‘Make’ programmes, speedily pushing the ‘Strategic Partnership’ model, and
many more.
The only hope for the industry is pinned on the ‘Strategic Partnership’ model. This cannot be allowed to
be relegated to the dustbin. The Modi mantra of ‘Make in India’ relies on this single initiative.
I would expect to see the RFI for the single-engine aircraft, coming out soon. We have discussed enough
and cannot afford to play Snakes and Ladders with strategic procurement. If we have learnt one lesson
from history, it is not to repeat the dancing planes of the MMRCA competition.
Creating a generic QR is good, but not at the cost of
strategic procurement. Let the IAF decide the platform
and the process can be kicked in with the RFI. If the IAF
wants the single-engine plane, why must the non-stake-
holders hold the levers? The prominence given to views
of generalists in the process needs reconsideration.
We know that the Finance Ministry can ask the fun-
damental questions at the far end of the process. They
must be encouraged to read more and gain background
knowledge. The non-stakeholders are also here to find
solutions to make it happen, not to find ways of stalling the programmes. This attitudinal shift is nec-
essary.
With the RFIs for the Navy’s rotary wing requirement out, the industry will emerge stronger in support
of the forces. The forces need to march into the industry arena, transformational changes will result.
Development Partnership is an essential pre-requisite to the SP model, an inclusive approach will cre-
ate and enhance the eco-system. We have a strong ecosystem, nurtured by the OFB and DPSUs, this is
however not strong enough. The SPs are expected to ride over the successes of the prevalent eco-system
and build newer ones across geography.
A twin-fold strategy is called for: Harness the existing strengths and enhance the existing capability,
both organically and inorganically. Some foreign procurements are a necessity. It is an opportune time
to get the Predators and Avengers from the U.S., with the relationship at levels never seen before, and the
US2I seaplanes from the Japanese, with whom the relationship has soared in the recent years; the FRCV
along with the FICV; the TCS and BMS; all these under the ‘Make’ route.
All this calls for an aggressive implementation of the policy. The concept of passing the baton as suggest-
ed by the Experts Committee needs to be adopted completely. Accountability is the key. Happy reading,
Jai Hind!

-- Colonel K. V. Kuber
Chief Executive, Sugosha Advisory

4 | DefInsights | January 2018

EXCLUSIVE INTERVIEW

CAPABLE OF MEETING
CHINA’S ‘NO CONTACT
WAR’: GENERAL RAWAT

The Indian Army has taken concrete steps to energise and enhance capabilities in Information and Cyber
warfare, apart from its ISR capabilities. In an exclusive interview with Sugosha Advisory Chief Executive
Colonel K. V. Kuber and DefInsights editor N. C. Bipindra, General Bipin Rawat says the Army is also
constantly refining its own defence strategy and doctrines to keep abreast of the changing security paradigm.
Here go the excerpts:

Q. What are the principal operational chal- indigenisation, we are on the right path to ad-
lenges that the Indian Army is facing? How dress our capability requirements in a holistic
is the Indian Army preparing to tackle these manner.
challenges?
Q. Given the modernisation of the PLA, and
A. Challenges being faced by the Indian Army their core ideology and war doctrine of ‘No
encompass the entire spectrum of conflict. As Contact War’, how do you see the shaping
we have territorial disputes along our northern of the Indian Army to counter this? Do you
as well as western borders, the nature of these think we are prepared for such a confronta-
threats in the conventional domain is premised tion, given that the Chinese may like to strike
on land-based threats, which pose a constant deep in the hinterland and leave the contact
challenge to our territorial integrity. In the zone/borders free of contact?
sub-conventional domain, terrorism forces us
to commit resources and troops to also counter A. The army is fully seized of the military secu-
this threat. The emerging threats to cyber, space rity needs of the country. Own defence strategy
and information domains are blurring physical and doctrines are being constantly refined keep-
borders and creating new challenges. ing in view the changing security paradigm in
our immediate and extended neighbourhood,
We have judiciously employed our resources to and the world at large. Our infrastructure de-
ensure territorial integrity against any external velopment, force accretion and modernisation
or internal threats, as per mandated tasks. The are being implemented in consonance with our
security situation in Jammu and Kashmir and threat perception to secure our borders.
the North East are under control, despite des-
perate attempts by terrorists and their support- Keeping pace with threats of modern day war-
ers to foment violence. fare, we have taken concrete steps to energise
and enhance our capabilities in Information
We need to develop a greater operational capa- Warfare, Cyber Warfare and Intelligence, Sur-
bility. But can assure all present that the Indi- veillance and Reconnaissance. We are capable to
an Army is fully-capable and well-equipped to meet any threat be it on frontiers or deep in the
defend national sovereignty. The operational hinterland with or without contact.
capability development is an ongoing process
that needs regular audit and review to keep it Q. There is a common perception that the
congruent to the security imperatives. The ar- Indian armed forces are systematically be-
my-specific requirements of force modernisa- ing downgraded, both in stature as well as in
tion and making up critical deficiencies remain quantitative terms (pay and privileges). What
key focus areas. Our over-dependence on im- are the steps being taken to restore the Indian
ports had made the situation difficult, but, with Army’s pride that the nation believes the most
the ‘Make in India endeavour and the thrust on in? Why is there such a perception in the serv-

January 2018 | DefInsights | 5

EXCLUSIVE INTERVIEW

Q. For effective military diplomacy to take
shape, military officers must hold positions
in the Ministry of External Affairs (MEA)
and vice-versa. The proliferation of military
officers from Director-level onwards till the
level of Secretary in the MEA is an essential
pre-requisite. A similar structure needs to
be evolved for our embassies abroad. Also,
the Defence Secretary often must be from the
IFS or Military cadre, for effective Military
Diplomacy. What are your views on such a
close structure-enabled cooperation? Mili-
tary Diplomacy indeed must be enforced by
the might of the military and the skill of the
bureaucracy. What are your views on this?

A. Our military-civilian cooperation is contin-
uously evolving to meet the complex security
challenges in the current geostrategic environ-
ment. Towards this end, it has been enabled by
cross-staffing of military officers in MEA. Pres-
ently, it is at the Director level, and I am sure, its
levels can only increase in the future.

ing and veteran community regarding down- Our Military Diplomacy is synchronous with
grading? How do you intend to correct this? the country’s diplomatic and strategic initia-
tives and augments the initiatives being taken
A. In any organisation, where personnel of two to achieve necessary diplomatic leverage. We
cadres or more, who are governed by different are working in close coordination with the min-
set of rules with different designations, work istries to foster synergy in all facets of national
side-by-side, there are bound to be functional security. Today, our military diplomatic reach
issues. This functional dissonance, however, has extends to 44 countries. This may increase, in
not affected adversely the effectiveness of the keeping with the requirements of protecting
Services headquarters. We, too, have our share and pursuing our national interests.
of minor concerns in this regard and have ap-
prised the MoD of the same. Q. What progress has been made by the Indi-
an Army on its Mountain Strike Corps plans
Here, I must reiterate that there can be no that were operationalised half-a-decade ago?
equivalence between two distinct Services. The
Armed Force Headquarters (AFHQ) Civil Ser- A. The raising of the Mountain Strike Corps
vices is a support cadre with no executive au- is on track as per the raising plan. Concurrent
thority and is meant to provide secretarial sup- issues with respect to equipping, financial sup-
port to the Services. We need to have a healthy port and billeting arrangements for the units are
functional relationship to include consideration being looked into, and where required, these are
for their career progression. The functioning of being highlighted to the Ministry of Defence at
the Services, however, cannot be dictated by the the appropriate level.
support cadre.
Operational readiness of the formation is a pri-
The Service headquarters works on a Peace Es- ority for the Army and is being vigorously fol-
tablishment (PE) approved by the Government. lowed up.
Arbitrary actions in terms of the cadre reviews
and increase in senior-level posts by AFHQ Q. What is the status of long-postponed 1999
Civil Services without any requirement project- Field Artillery Rationalisation Plan (FARP),
ed by Services has disturbed this establishment. under which the Army had aimed to import,
The issue of equivalence had been projected by locally-develop, and licence-produce 155mm
the Chairman Chiefs of Staff Committee and howitzers of various categories?
the Defence Minister has fully supported us on
this issue. A. 155mm calibre guns have been made the

6 | DefInsights | January 2018

EXCLUSIVE INTERVIEW

standard gun system for Indian Artillery. Ac- However, there remain persistent efforts by in-
cordingly, the ‘Artillery Profile’ was conceived imical elements to calibrate violence and keep
and promulgated with emphasis on Medium- the pot boiling. The Army will continue with its
isation of Artillery. Our operational necessity operations to deny any operating space to the
and concerted effort have resulted in successful- terrorists and facilitate the developmental ac-
ly contracting Ultra-Light Howitzers from the tivities. The Indian Army, in coordination with
U.S. Government and Tracked (Self Propelled) the other security agencies, has succeeded in re-
Artillery guns with the Larsen & Toubro. storing normalcy by carrying out relentless peo-
ple-friendly operations. The Jammu and Kash-
To give impetus to indigenisation, major proj- mir Police, in particular, has been pro-active in
ects such as the Dhanush Gun System, designed their support for the security forces.
and developed by Ordnance Factory Board The overt peace being witnessed in Jammu and
and the Advance Towed Artillery Gun System Kashmir is a result of the two-and-a-half de-
(ATAGS), designed by the DRDO in partner- cades of relentless efforts of the Army, in syn-
ship with the private industry, are being pur- ergy with the other security forces, and their
sued with a sense of urgency. It will be fair to countless sacrifices.
mention that FARP is moving on track and we The terror infrastructure in Pakistan remains
will, in the next 2-3 years, have progressed with unchanged. The situation in Jammu and Kash-
the proposals, in a satisfactory manner. mir is continuously mutating, which needs a
dynamic response strategy to neutralise, con-
Q. With the elimination of several under- tain and expose Pakistan. The Indian Army, in
ground armed militants and their outfit lead- coordination with the other security agencies,
ers in Jammu and Kashmir in the last few has succeeded in restoring normalcy by carry-
months, do we expect peace to be stabilised ing out relentless people-friendly operations.
in the border, troubled province over the next The Indian Army has also adapted well to the
few years? What is the peace strategy that the fluid situation in the State and the new domains
Army is adopting for Jammu and Kashmir? of social media. We are engaging the common
How about the strategy for operations along populace through different mediums and reach-
the Line of Control? ing out to them using Sadbhavna and other pro-
grammes, convergent with their culture, tradi-
A. The security situation in Jammu and Kash- tion and Kashmiriyat.
mir is operationally under control, wherein
violence levels have come down considerably.

January 2018 | DefInsights | 7

THE LEADERSHIP

DEFENCE MINISTER’S
SCIENTIFIC ADVISER
BAGS DESIGN AWARD

Dr G. Satheesh Reddy, Scientific Adviser to India’s open to industry, academia and research organisa-
Defence Minister, has won the prestigious National tions for collaborative research and development.
Design Award for his significant contribution towards Reddy, the Defence Research and Development Or-
indigenous design and development of Missile Sys- ganisation (DRDO) Director General for Missiles and
tems, Guided Weapons, and Avionics technologies. Strategic Systems, graduated in Electronics and Com-
He has bagged the award also for his sustained efforts, munication Engineering from JNTU, Anantapur and
leading to the advancement of aerospace technologies pursued his MS and Doctorate from JNTU, Hyder-
and industries in India. Reddy spearheads the Dr APJ abad. He is a globally renowned navigation expert and
Abdul Kalam Missile Complex in Hyderabad, which is the only scientist from India holding the distinction
is the missiles hub of India, steering the design and of being inducted as a Fellow of the Royal Institute of
development of a wide variety of tactical and strategic Navigation, London; and the Royal Aeronautical Soci-
missile systems. ety, United Kingdom.

His contributions have left a lasting He is the first Indian scientist to be honoured and in-
imprint on the technology map as ducted as a Foreign Member of the Academy of Nav-
well as on the defence preparedness igation and Motion Control, Russia. He is an Honor-
of the country and paved the way for ary Fellow of Computer Society of India and Fellow
self-sufficiency in Missile Systems of many other professional/scientific bodies in the
and Technologies. Dr Satheesh has country and abroad.
played a major role in indigenous For his significant contributions to defence science
design and development of state-of- and technology, Reddy has previously received the
the-art weapon systems, formula- prestigious Indian Science Congress Association
tion of national policies, harnessing Homi J. Bhabha Memorial Award, DRDO Agni Award
the research and innovation that for Excellence in Self Reliance and the Young Scientist
have taken place in the industry, ac- Award from Prime Ministers of India. He was con-
ademia and at India’s research and ferred with the first IEI-IEEE (USA) joint award for
development institutes. He received Engineering Excellence, which he received from IEEE
the award during the Indian Engi- President, USA.
neering Congress on December 21, He became the first-ever scientist from India to be
2017, at Chennai. conferred with the Silver Medal of Royal Aeronautical
National Design Research Forum (NDRF) estab- Society, London in the Society’s Awards history span-
lished by the Institution of Engineers (India) pro- ning over 100 years. Incidentally the first Gold Medal
motes Research, Design, Development, Producti- of the Royal Aeronautical Society, London was award-
sation and Innovation through collaborative effort ed to Orville and Wilbur Wright - the Wright Brothers
since 1969. NDRF is anchoring inter-disciplinary way back in 1909.
technological research in many engineering disci- Reddy is also a recipient of the National Aeronauti-
plines including for societal applications and plays a cal Prize, National Systems Gold Medal, Dr Biren Roy
major role in deploying engineering and technology Space Science Design Award, Rocket-related Technol-
services, systems, and solutions for nation-building. ogies Award, Science Congress Lifetime Achievement
NDRF continues the tradition of identifying and Award and many other honours and recognition. He
recognising outstanding contribution to engineering has been conferred with Honorary Degrees of Doctor
design through the National Design Awards since its of Science by many leading universities of the country.
inception. These activities and facilities of NDRF are

8 | DefInsights | January 2018

EXCLUSIVE INTERVIEW

HOKE HOI NA?
HO! HO! HO!

Little proud girl Alka Rai brings age-old traditions
to life and to the knowledge of the common man!
Bravery is in the genes, standing steadfast, raising
her right arm to a perfect salute. A brave daughter
bid farewell to her father, who fell to the bullets man-
ufactured by criminals and used by cowards. Martyr
Colonel M. N. Rai was from the 9th Gorkha Rifles.

History dates to the Treaty of Sugauli, between the
British and Nepal government following a massive
offensive by the Gorkhas, who went towards Darjeel-
ing and Dehradun, and the plains of India. A battle
followed at Nalapani; the unique memorial made by
the British represents the valour and sacrifice duly
recognised by the victors, by engraving the martyrs
of Gorkhas and British on each side of the memorial.

The Gorkha General, defeated in the battle, refused Army retained 1st, 3rd, 4th, 5th, 8th and 9th GR, while
to go back to Nepal, as a penance for discrediting his 11th GR was raised after independence. Incidentally,
King. Survivors of the war along with their leaders Chief of Army Staff General Bipin Rawat belongs to
thereafter served under Maharaja Ranjit Singh, who the 11th GR. Each regiment initially had just one bat-
expanded his empire to Tibet and went on to rule talion, slowly increasing their number now to an aver-
Afghanistan along with greater Punjab. The Gorkhas age of five battalions per regiment. The COAS is also
assumed the name of “Lahorees”, after the capital the President of the Brigade of Gorkhas.
Lahore of the Maharaja. Maharaja also had French On being asked what is so unique of the 9th GR, Gen
officers training the Indian soldiers. Bhatt said that they were fundamentally extremely
After the war, the British never ruled Nepal and simple folks, just that the enemy is and has always
in awe of the Gorkha spirit, recruited them into been mortally scared of them. Just wear the badges
the British Indian Army. Loyalty and valour of the of rank, no backing, no lanyard, smartly dressed, dis-
Gorkha can only be admired; Field Marshal Sam tinguished by the “Chindits badge” (the formation of
Manekshaw said, “if a man says he is not afraid of the Chindits force operated behind the enemy lines
death, he is either lying or is a Gorkha.” in Burma campaign); remain immersed in “duty”. It
Sugosha Media’s Chief Executive Colonel K. V. Ku- is indeed a rare honour for being chosen as special
ber and DefInsights Editor N. C. Bipindra had a one- forces to operate behind the Japanese lines to terrify
on-one interaction with Lt Gen Anil Bhatt, the Col- them, executed with precision and daring. The Reg-
onel of the Regiment of 9th Gorkha Rifles and the iment has been awarded three Victoria Crosses, five
Director General Military Operations in December Maha Vir Chakras and 17 Vir Chakras in addition to
2017, to get an insight into the rich and glorious his- the number of battle honours in various operations.
tory that defines valour and sacrifice. Four Chiefs from the Gorkhas and a Field Marshal
The Colonel of 9th Gorkha Rifles explained how too, along with four DGMOs - it is not a mere coin-
the British adored the Gorkha as extremely special cidence. It reflects the dedication to duty, responding
to them and used them as special forces. When the to the call of the nation with more than what one has.
British were leaving India, they allowed the Gorkhas This is the definition of Gorkha valour.
to make their choice of affiliation to either the United
Kingdom or India, confident that the Gorkhas would
naturally choose the United Kingdom.
To their surprise, the reverse happened. The Indian

January 2018 | DefInsights | 9

EXCLUSIVE INTERVIEW

‘Kukhri’, the Nepalese inward curved knife, is more a discussion point many a time and having tried the
of an extension of the Gorkha arm and its relevance experiment post-1984, they have reverted to the age-
is in the importance the Gorkha attaches to it. Inte- old system, in just a few years’ time.
gral to the Gorkha skin, they are trained formally in There are few challenges in a mixed battalion and
its use, “Kukhri Haath”. It has been put to effective even our neighbours have a greater number of Pun-
use on a few occasions when the conventional rifle jabis in Baluch regiment or even in Pathan regiments
and ammunition failed. since the population is predominantly Punjabis. The
Probably, the never-say-die attitude of the Gorkha British follow pure regiment concept and few west-
soldier comes from the Kukhri. “His greatness lies ern nations like Italy, France and Germany do retain
in his innocence and simplicity which embellish- certain flavours of pure regimentation.
es his stellar qualities of indomitable physical and 36 years ago, did Gentleman Cadet Bhatt, opt for
moral courage and steadfast loyalty and integrity,” Gorkhas? The answer is a resounding “Yes”. There
says General Bhatt. In his own humble manner, he was never a doubt. Having been raised in Dehradun,
dedicates the bicentenary celebrations to the un- seeing the smartly turned out Gorkha with a slant
sung hero of the regiment with the deepest grati- hat, chin buckled up, and the legendary stories of
tude to valiant ancestors of 9th Gorkhas, because Sam -- all these imageries only inspires strong belief
of whom they stand tall with 200 years of greatness in the Gorkhas.
behind them. General Bhatt draws his entire inspi- General Bhatt says this belief of his was proved right.
ration from history. His decision 36 years ago was based on those prin-
Parampara or traditions has been the guiding light ciples that coincidentally the regiment stood for. On
of the Gorkhas. The officers speak Gorkhali, conduct commissioning he went and bought the stars and
training in Gorkhali, all Sainik Sammelans are in the other pieces of uniform and could not find a lanyard,
native; well this is missing in other regiments. At so he bought one that was meant for another regi-
this point, on the question of the need to retain pure ment.
regiments, the general remarked that this has been

10 | DefInsights | January 2018

EXCLUSIVE INTERVIEW

When Bhatt went to the unit of his commissioning, the family. Many of the personnel below officer rank
he was disappointed that their regiment did not have been able to motivate their children to grow
wear lanyards. When asked for the reason for being into the officer cadre. Once such example is that of
lanyard-less, the story is most convincing. The then a serving Lt Col, whose father laid down his life for
Colonel of 9 GR had demanded that they be allowed the country in 1971; brought up by the regiment, he
to don the lanyard on the right shoulder, to signify serves the Indian Army with the pride of a Gorkha.
royalty and in recognition of their contribution to Then, there is a martyr’s spouse awaiting induction
the wars they fought that made the British rule the having cleared her Services Selection Board, this
world for long. When this demand was not acced- type of encouragement is ongoing in the 9 GR fra-
ed to by the British, the regiment decided, if not the ternity.
right shoulder, they will not wear any lanyard at all. The Gorkha is straight and stoic, can do no harm,
They never wanted to make it flashy. There is history and easily wins the hearts and minds of the people
to recall here: The General who led the US Army in they go to defend or fight. They basically cannot do
the fall of Saigon had been recognised as the most any harm. Says Lt Gen Bhatt, in adversity or in great
well-dressed General just a year before. Simplicity happiness, the Gorkha is stable.
drives valour, and so we believe, from Gen Bhatt’s Lord Krishna says in the Bhagwat Gita, “Sukha-duh-
recounting of history. khe sama krtva labha alabhau jaya ajayau; tato yud-
On being asked why the Gorkhas strap the belt of the dhaya yujyasva naivam papam avapsyasi”. Translated
cap to the chin, he said, some regiments strap it to it defines the Gorkha spirit, “equanimity in happi-
the chin and others to the lower lip; just to remind ness or distress, loss or gain, victory or defeat—and,
ourselves to maintain silence and concentrate on the by so doing, you shall never incur sin”.
work at hand. The Gorkhas have remained what they were in
What do the Gorkhas do after their retirement? Many the 1960s, with little addition to their numerical
retire young, they go away to Afghanistan, Singapore strength, while their qualitative strength has been of
and Japan for security duties, while the majority lead concern to the enemy. The mix between India and
a contented life back in the hills, extending a helping Nepal Gorkhas is 60:40 in favour of India; while the
hand to each other. Money has never been a concern Nepali is from the hills with a rural background, the
for a Gorkha. Indian counterpart is worldlier wise.

Many Gorkhas have their lineages established and However, they are not affected by the political turn
the younger generation takes up arms and Kukhri of events in Nepal. The Indian Army maintains three
together, to continue the military service tradition in Pension and Pay Offices in Nepal - one each in Po-

January 2018 | DefInsights | 11

EXCLUSIVE INTERVIEW

kara, Khatmandu and Dater - thus integrating the Bidding bye to the Gorkha in front of us was not
largest embassy of India. There are more than 65,000 easy, but his assignment as DGMO has demands of
soldiers and 25,000 families of deceased servicemen, time and attention like never, having had to handle
thus a whopping number of 90,000 families to look the Doklam situation with the Chinese Army near
after. The Indian Army distributes more than Rs 17 the Bhutan border, and the firefight in the North, be-
crore each year through its pension offices and this sides planning for the future.
year, the bill may double in view of the ‘One Rank – We had to leave the DGMO to spell out the opera-
One Pension’ and the 7th Central Pay Commission tional requirements of the future weapon systems
recommendations. that normally do not see the light of the day and there
Traditionally, more than 50 percent of the Chiefs could be often dozens of DGMOs by which time the
of the Army in Nepal are Indian Military Academy forces are lucky to see new inductions. This portion of
alumnus, and the Chief of Army Staff of each coun- the system that equips the soldier does not appear to
try is the Honorary General of the other’s Army too. be working well.
That is the kind of bonding that the two Armies of For the valour, supreme sacrifice and steadfast resil-
the two nations enjoy and this tradition has contin- ience of the soldier, the least the nation can do is to
ued for long. arm them adequately. While the DGMO is an opera-
‘Jai Mahakali, Ayo Gorkhali’, the war cry of the tional man and is responsible to define the operational
Gorkhas when heard on the battlefield, sends shivers requirements, General Bhatt says, “we are aware of the
down the spine of the enemy, relegating him into a cost to the country and make our choices reasonably
defensive position all the time, time and again. modest.” That’s a soldier and a Gentleman.

12 | DefInsights | January 2018

POLICY ANALYSIS

TRANSFORMATIONAL
REFORMS IN DEFENCE
PRODUCTION

By Prof. The year 2001 was a watershed moment for the de- Economic liberalisation has been a game changer
S.N. Misra fence sector when the government decided to allow when parties cutting across ideologies have realised
26 percent Foreign Direct Investment (FDI) and full that the raw energy and dynamism of India’s private
participation of the private sector in defence man- sector must be fully harnessed. The Probin Sengupta
ufacturing. Prof. Vijay Kelkar, the marquee reform- Committee argued that Raksha Udyog Ratna (RUR)
er, recommended in 2005 that a level playing field status should be given to a few private sector play-
should be provided to the private sector players and ers like the Tatas, L&T, M&M, at par with Navaratna
a Public-Private-Partnership (PPP) model tried out, DPSUs like HAL, BEL, and MDL. These recommen-
on the lines of success achieved in telecom, national dations, however, did not find favour as many play-
highways and airports. ers in the private sector, particularly in the field of
He also brought in a whiff of fresh air through a new IT, felt that the parameters for selecting RUR were
offset policy by leveraging big-ticket acquisitions to tailor-made to favour a few private sector players.
get key technology, outsourcing orders and FDI from It is in this backdrop, the MoD introduced a signif-
the Original Equipment Manufacturers (OEMs). icant change in its shipbuilding procedure in 2008
The Krishnamurthy Committee which proposed the when the private sector players were allowed to com-
National Manufacturing Zone Policy (2011) also pete for manufacturing surveillance vessels. This
suggested that defence manufacturing should be witnessed an exciting competition between GSL, a
part of the National Manufacturing Policy. However, defence shipyard, and private shipyards like Pipavav,
there has always been a niggling feeling that the pri- L&T & ABG, for manufacturing surveillance vessels
vate sectors were the outliers, while the PSUs would like OPVs and IPVs. The level playing experiment
continue to be the “temples of modern India” and won private players orders. To their credit, they have
have a privileged status. delivered the IPVs much faster and at much lower

January 2018 | DefInsights | 13

POLICY ANALYSIS

price than what was being quoted by GSL, with its with an indigenous engine design programme, called
entrenched monopoly position. This has clearly vin- Kaveri, which failed the design audit of Snecma, af-
dicated that competition is the key to fairness and ter running the programme for 15 years. The pro-
low cost. gramme is now shelved and the indigenously built
The Structural Concerns LCA aircraft will be powered by a GE 414, an engine
from the US!

Yet the defence manufacturing sector is bedevilled It is in this backdrop it would be interesting to go
by many structural concerns. Firstly, the services, through the indigenisation and ‘Make in India’ ini-
the manufacturing agencies, and the research tiatives in India.
organisations as the stakeholders, often act at Self Reliance Index
cross-purposes; leading to interminable delay, high The ‘Buy’ option, namely, importing weapons plat-
cost and blame game. forms and systems from OEMs, has been the priority
A classic case is that of LCA, which was to replace the of the services, as they dread the interminable delay
ageing MiG-21 aircraft. Right from the beginning, and capability of indigenous initiatives. The technol-
the IAF was not sanguine about GTRE’s capability ogy transfer route, ‘Buy & Make’ is the second op-
to deliver a gas turbine engine. HAL, the manufac- tion, where the imported parts are assembled and in-
turing agency for the prototype and the production tegrated with a fair degree of dexterity by the DPSUs.
version, felt that converting DRDO’s design to pro- However, value addition is a serious concern in this
totype is a serious irritant. It may be recalled that route, as major platforms like Su-30 aircraft have
Chidambaram Subramaniam Committee (1964) had clearly demonstrated. In the “Know how” route,
noted that India does not have domain knowledge in building design capability is a huge casualty. Defence
aero engine design. Unlike IIT Kharagpur, which has research is strikingly different from that of Atomic
a naval design course, no engineering college or the Energy Agency, where the BARC has been able to
Indian Institute of Science in India has this exper- build a state-of-the-art reactor, based on Canadian
tise. The Committee had strongly advocated that we technology.
should have design collaboration with major design
houses like Rolls Royce, GE or Snecma. However,
the DRDO pressurised the government to go ahead

14 | DefInsights | January 2018

POLICY ANALYSIS

It is because of our lack of depth and commitment newed effort to energise defence manufacturing. The
in indigenous R&D, the ‘Make in India’ initiative NDA government has increased the FDI limit to 49
has taken a serious beating, with our Self Reliance percent and constituted a committee under Dhiren-
Index as low as 30 percent. This is particularly poor dra Singh to suggest ways and means to infuse ‘Make
in sub-systems like propulsion, weapons and sensors in India’ spirit into defence manufacturing.
where our import dependency is abnormally high. The Committee has come up with a recommenda-
(See Infographic) tion to have a Strategic Partnership Model, where
The Dr APJ Abdul Kalam Committee had recom- one or two private sector players would be identified
mended to improve our Self Reliance level to 70 in sectors like Aircraft, Warships, AFVs, Guidance
percent by 2005 by developing work centres at the system, CCI and Critical material. It has also sug-
national level and bring together PSUs, DRDO, gested that a specialist organisation should be creat-
ISRO, CSIR, DAE, the private sector and academia ed for handling issues like an acquisition.
on one platform. The Committee had recommend- The SP model clearly reminds one of the RUR model,
ed that instead of setting up separate test facility by advocated by Probin Sengupta. It is like the old wine
each research organisation, National Centres should in a new bottle, which is likely not to see the light of
be created for building infrastructure for design and the day, as the parameters for selection opaque.
development for the nation.

The Defence Parliamentary Committee in 2005 had Lessons from DGA & DARPA
recommended that allocation to DRDO should be In this backdrop, India can take a leaf out of the ex-
increased from six percent of the defence budget to perience of DGA in France & DARPA of USA to rev
10 percent, to help them to take up the state-of-the- up our defence manufacturing and research. The
art critical sub-systems in a credible manner. These Director-General of Armaments in France is the
recommendations have been put into the backburn- procurement and technology agency responsible for
er since then. programme management, design and development
Strategic Partnership Model and procurement of weapons system for the French
With the NDA coming to power, there has been a re- military.

January 2018 | DefInsights | 15

POLICY ANALYSIS

It coordinates armament programme with local in- ident Eisenhower in 1958, in response to the techno-
dustries in France and other countries of Europe be- logical surprise throw by Sputnik of USSR (1957), is
sides customers for exports. It has also entered into a frontline research organization, which collaborates
cooperative armament programmes like Combat with academia, industry and the government for
Tiger Helicopter; Ground-to-Air missiles and an- developing of emerging technology required by the
ti-aircraft systems. The entire gamut of design, de- military. The DRDO of India needs to draw lessons
velopment, acquisition, collaborative arrangements from the functioning of DARPA.
and exports are thus handled by one overreaching The Way Forward
organisation.

It would make eminent sense to consider replicating We need to encourage similar synergy between ac-
such institutional model in India. This was strong- ademia, industry and the government. The “Make”
ly advocated by the Sisodia Committee (2009), who procedure in DPP envisages that 80 percent funding
had observed with concern the lack of professional can be provided to private agencies for developing a
expertise in handling such issues in the Acquisition prototype. However, given the poor pace of ‘Make’
Wing of the MoD. programmes, such funding is hardly availed of.

Further, in countries like the US, the private sector The MoD also came up with a policy paper in 2010
is treated as a partner from the design and develop- to provide funding support to academic institutions
ment stage to manufacturing and maintenance of and industry for design and development of state-
weapon systems. DARPA which was created by Pres- of-the-art systems. This was with a view to improv-

16 | DefInsights | January 2018

POLICY ANALYSIS

ing our self-reliance quotient in critical technology. The government must also allow the private sector
These have remained theoretical surmises so far. to enter into production of helicopters, transport
Prof. Rama Rao, a distinguished metallurgist and aircraft and frigates and submarines for the navy
DRDO scientist, had very perceptively suggest- as they have done for the surveillance vessels. The
ed (2008) that for indigenous research to have ac- present limit of 49 percent in FDI must be increased
countability, it should be placed under the produc- to 51 percent, as that would attract OEMs to set up
tion organisation. He was reflecting on the lack of a manufacturing base in India and bring in critical
coordination accountability, lime and cost overruns technology.
in mega programs like Kaveri and MBT, where the
design agency and production houses work in silos. China did this for Boeing, by allowing 76 percent
This would require a major structural change. FDI. If India wants to become a global manufactur-
Concluding Thoughts ing hub in defence production, the NDA govern-
The Defence Minister should seriously look at the ment must give a “big push” to increase FDI in de-
DGA model of France for bringing design, produc- fence. A major structural and decisive policy change
tion and acquisition under one umbrella. Politics is is warranted to usher in transformation change in
the art of the possible. Given political will, defence indigenous manufacturing of critical subsystems in
manufacturing and design can be galvanised. There defence.
is also a strong case for disinvestment of Navaratna
DPSUs like HAL, BEL and the MDL. (The writer was Joint Secretary (Aerospace) in the
Indian Ministry of Defence. The views are personal)

January 2018 | DefInsights | 17

MONEY MATTERS

ROLE AND EXPECTATIONS
FROM THE DEFENCE
BUDGET FOR FY19

By Rukmani Defence budgets account for a huge chunk of the sues. Total GDP of Japan for FY16 was $4,939.38
Gupta budget portion for countries around the world billion, which represents approximately 6 per-
every year. From past 4-5 years military spend- cent of the world’s economy. So, Japan’s current
ing throughout the world had increased amid defence spending would be approx. 0.95% of its
growing tensions; like China had increased its GDP.
current defence budget from $150 billion to China: PLA’s total defence budget for FY17 is
$215 billion, and the U.S. had increased its cur- $215 billion, and its total GDP for FY16 was
rent defence budget to $824.6 billion from the $11,200 billion. So, it represents approximately
previous approximately $611 billion. 1.92 percent of its GDP. There are five branches
India’s total budget for FY18 was $318.27 bil- under PLA- the Ground Force, Navy, Air Force,
lion, out of which approximately $53.35 billion Rocket Force, and the Strategic Support Force.
was allocated to defence including defence civil Russia: Russian defence budget for 2017 is ap-
amenities and pensions. This was approximate- proximately $70 billion. Its 2016 GDP was
ly 17 percent of India’s total budget. The budget $1,283 billion. So, its military budget is approx-
is allocated across five wings - Army (57 per- imately 5.45 percent of its GDP, which is sub-
cent), Air Force (22 percent), Navy (14 percent), stantially high. Russia’s military budget is higher
Ordnance Factories (1 percent), and DRDO (6 than any other European nation.
percent). India’s GDP for 2016 was $2,264 bil- North Korea: It’s a small country, its GDP for
lion, so the allocation was approximately 2.4 2016 was approximately $29 billion, and it had
percent of its GDP over military expenditures. latest annual spend on the military is approxi-
Global Indicators: As per the Stockholm Inter- mately $6 billion. But, as a proportion to GDP, it
national Peace Research Institute, World’s total had more than 20 percent of its GDP on military
spending on military in 2016 was $1,686 billion, spending. And, its increasing nuclear weapons
which is approximately 2.2 percent of GDP of power had increased the concern for the entire
the world’s economy. Some economies have a world to empower their military strengths.
spending as under:

United States: US Military budget for the pe- Budget 2018 Expectations
riod October 2017-September 2018 is $824.6 As per the analysts, India had huge military
billion. They are the highest in military spend- equipment deficit, which was termed as ‘critical
ing. It has four major components, that is, DOD hollowness’ by former army chief General V. K.
Base budget, DOD Overseas Contingency, Sup- Singh, for a first-class military if not superpow-
port Base and Support OCO. US GDP for 2016 er, India would need more than 5-6 percent of
was $18570 billion, so it had allocated about GDP to be allocated on military spending.
4.45 percent of its GDP to its military expendi- A relatively stagnant budget over the years with
tures. And US GDP represents more than 20% a painfully slow process for modernisation
of World’s economy. So, in nutshell alone US (called as the Defence Procurement Procedure),
had allocated approx. 1% of world’s economy on has had an adverse effect on the modernisation
military expenditure. plans of the Forces.
Japan: PM Shinzo Abe’s cabinet had approved In a recent reply from the Minister of State to
Japan’s defence budget for Apr.17-Mar.18 of $46 a question in the parliament, following infor-
Billion out of total $ 860 billion. This is to devel-
op the ballistic missile defence North Korean is-

18 | DefInsights | January 2018

MONEY MATTERS

mation was tabled, India has spent Rs 2.40 lakh While the performance of the government in
crore in the past four years, inking 187 contracts its four years is impressive, it may not be good
with foreign and domestic firms. The deals in- enough, considering the geopolitical situation
volved procurement of various military plat- in the Indian Sub-Continent. There is an aggres-
forms and equipment. The same was conveyed sive expansion plan of the PLA and an unstable
in the Lok Sabha by Minister of State for De- Pakistan on the other side and the expansionist
fence Subhash Bhamre. He went on to say that reaches of China in Srilanka, Djibouti, South
out of the 187 contracts, 119 were signed with China Sea and other activities like the North
Indian vendors - the total cost of which came up Korean designs; these have an impact on how
to Rs 1.62 lakh crore. we may like to spend to keep our Indian Armed
In comparison, only 68 procurement deals Forces concurrent.
worth Rs 1.24 lakh crore have been signed with The defence budget seems to be critically short
foreign vendors. The value of total contracts in the overall target of capacity building of our
signed in the last four years comes to Rs 2.40 defence system to meet the threat perceptions.
lakh crore. He said the expenditure on the cap- The demand side of 500 helicopters, 12 subma-
ital acquisition in 2014-15 was Rs 65,862 crore rines, 100 single engine fighter jets, and other
while the figures for 2015-16 and 2016-17 were strategic acquisitions are pretty large, therefore
Rs 62,235 crore and Rs 68,252 crore respective- calling for a substantial allocation in defence ex-
ly. Bhamre said the value of defence production penditures. Almost 75% of allocation is expend-
by Ordnance Factory Board and other defence ed on maintaining the existing the workforce,
public sector undertakings during 2014-15 was their salaries and other fixed expenditure, so
Rs 46,390 crore while it was Rs 52,960 crore in how then can we build up a proper inventory of
2015-16. In 2016-17, the value of defence pro- weapons, our Indian Armed forces so very des-
duction by these government entities was Rs perately need?
55,890 crore, he said. Bhamre said the budget es- From above statistics, we can see that our al-
timate for disinvestment in 2017-18 is Rs 72,500 most 90% of capital acquisition budget goes into
crore. “This comprised Rs 46,500 crore from the past committed liabilities, so there is a little
disinvestment of CPSEs (central public-sector scope for new orders, generally we must pay 15
enterprises) and Rs 15,000 crore from strategic percent as an advance in 1st year for any pro-
disinvestment and Rs 11,000 crore from a listing curement, so the leftovers are expected to fund
of insurance companies,” he said.

January 2018 | DefInsights | 19

MONEY MATTERS

new schemes; therefore, we can order capital It is an established fact that defence always pre-
equipment, worth no more than Rs. 55,000 cr. cedes the overall growth, this is the story in all
We now need to seriously consider the demand, developed countries. As on today, we do not
coming out of the expectations of the Strategic have any strong manufacturing set up for de-
Partnership models and other major MAKE fence equipment and aircrafts, thereby we are
programs, we need approximately $250 billion importing all the products at a much higher
over the period of next 10 years. To just square- cost, which is a drain our precious FE reserves,
ly meet this demand, an additional allocation while also contributing in increasing the deficit
of more than Rs 40,000 crore only for new ac- in current account.
quisitions over & above committed liabilities, is The growth in defence industry can be achieved
considered essential. if we can produce our own aircrafts, our own
The Modi Mantra of “Make in India” is driving weapons. For that, we need to invite adequate
private players to venture into this strategic sec- capital investments in those types of machin-
tor and make investments. It also places huge ery which can domestically produce competing
demands on India’s arms procurement process. products. Here the role of government is very
A fine balance is called for, between inviting for- crucial and is expected to liberalize and pro-
eign technology transfer, which offshore con- mote the private players to come up & invest in
tractors generally are not willing to extend and manufacturing facilities for defence equipment
the domestic design and development model of and aircraft.
production. The government has also formulat- The defence sector is a monopsony (as against
ed a more industry-friendly FDI policy by en- the monopoly of a few countries or companies
hancing foreign equities in the defence industry that produce a unique product), where the gov-
up to 49 percent under the automatic route and ernment is a single buyer. The Government of
100% under the government route. India will do well to strengthen the foundation-
Defence Vs Economy, and Challenges al mechanism and by creating enough domes-
National Economy and National Growth have a tic demand to sustain the industry for next 10-
direct relationship with the growth of Defence 15 years, so that the confidence in the private
Industry. Niti Aayog, on the one hand, is look- sector is enhanced to enable them to amortize
ing forward to a growing GDP rate of 8 percent a Return on Investment after a certain period,
plus. This can be achieved only when they are without losing focus on research & develop-
able to boost the defence growth by 15 percent. ment, so fundamental to organic growth. For
a strong Research and Development, not only

20 | DefInsights | January 2018

MONEY MATTERS

a huge capital investment is required but also tional arms, dual-use goods and technologies
we need to retain the skill & talent. Our tal- should reach in the hand of right people.
ent is moving offshore because we do not have Earlier, India also had joined the Missile Tech-
enough resources to cater to their capabilities nology Control Regime (MTCR), its member-
domestically. ship would help to boost India’s non-prolifera-
Having our own manufacturing setup, will not tion credentials. MTCR membership will enable
only serve our domestic demand but also it India to buy high-end missile technology and
will create scope for us to export these prod- enhance its joint ventures with Russia.
ucts. There is a need for India to stand tall in India is on the verge of joining the other two
the Indian Sub-continent region and be able to groups also, which NSG (Nuclear Suppliers
supply them with arsenal they need to protect Group) are & the Australia group. The Aus-
themselves, a strong neighbourhood with India tralia Group is an informal group of countries
as the fulcrum is a safe neighbourhood. The ini- to regulate the exports of chemical weapons &
tiative of this government in linking Chabahar biological weapons. Nuclear Suppliers Group
Port is another big step that can be leveraged for (NSG) is a group of nuclear supplier countries
enhancing defence exports. that seek to prevent nuclear proliferation by
On top of it, India has been admitted as the controlling the export of materials, equipment
42nd member of the Wassenaar Arrangement, and technology that can be used to manufacture
A global export control regime, this arrange- nuclear weapons. Hopefully, 2018 will usher in
ment will broaden the access of India to sensi- a new era when India may join both groups. So,
tive technologies. This Organization is designed joining all these groups will enhance India’s in-
to regulate the export of sensitive technologies ternational defence credentials & more export
that could possibly lead to “destabilizing accu- acceptability.
mulations”, so ultimately it ensures that conven-

January 2018 | DefInsights | 21

MONEY MATTERS

From the upcoming budget in Feb 2018, we ex- tential to become a hub due to policy paralysis
pect to boost our defence growth and ultimately and high costs.
our economic growth in the following manner:
• Defence capital budget should be increased So in nutshell Govt. need to work multifold
at least by Rs. 40000 cr. including additional if it wants to achieve a high economic growth
special allocation to the capital investments, rate, Chennai Aero Park is a good start, there is
which should be done to cater for indigenous an aerospace industrial park in Chennai (Srip-
programs in MAKE categories and the Strategic erambedur), With the objective of creating an
Partnership model. integrated ecosystem for Aerospace Industry
• Focus on the quality of defence products, development covering design, engineering, man-
weapons & equipment should be increased and ufacturing, servicing and maintenance of aircraft
that can be achieved by more capital invest- for civil and defence sector in Tamil Nadu, TID-
ments in technology development. CO is establishing an Aerospace components’
• Domestic demand should be increased to manufacturing park for aerospace industry in
boost the domestic players and also to enhance Sriperumbudhur (Chennai) in an area of around
their credentials in the eye of importers of oth- 250 acres expandable to 700 acres).
er countries (therefore substantial increase in
Modernisation budget is called for). Unless our The state government, in Karnataka, has given a
Armed forces buy our products, how we can go-ahead for setting up two top-notch aerospace
market it internationally. engineering colleges at the Aerospace Park be-
• Encouragement for patent and trademarks to ing developed near Devanahalli. The Aerospace
create an image of our Indian products, Make in Park project envisages setting up of institutions
India for the World. of excellence in aerospace engineering in Ban-
• Also, the key part of it is the intellect and galore, as the focus is not just on manufactur-
mind, for which we need to focus on talent & ing, but even on research and development
bright human resources to work for our do- front too. So, the federal government should
mestic products, for that need to create enough create corridors linking such manufacturing
avenues to retain our skill & talent to groom clusters and provide an enabling mechanism to
themselves. So that they do not migrate to other integrate the various Aero Parks & excellence
countries. hubs so as to achieve skill development, high
• We need to involve Academia to identify the technology, latest product at par with interna-
bright minds & talents, the youth ideas & skills. tional standards, cost reductions, attractions to
A separate fund like the Technology Develop- the foreign investors.
ment Fund is increased to at least Rs. 500 Crores
to fund industry/academic research. We expect to see a transformational budget,
• Also, the budget is expected to create special akin to the transformational reforms, this gov-
economic zones and business corridors specifi- ernment has undertaken in its tenure, thus far.
cally for Aerospace and defence, to enable eco-
system. India has so far failed to utilize its po- (The writer is a practising
Chartered Accountant in India)

22 | DefInsights | January 2018

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