India takes the Aatmanirbhar route to enhance Defense Exports
The South Asian Times, November 28, 2022

By Pradeep S. Mehta & Purushendra Singh

With an aim to convert vision into a mission, India has started to transform towards becoming a major defense manufacturing hub and a major exporter. Providing a defense ecosystem for incubating “Make in India, Make for the world”, the latest defense sector reforms are encouraging the private domestic and international players to play a proactive role.

Nations from Africa, Latin and Caribbean regions along with Central and South-East Asian nations have already started to enquire and place orders for the Indian built equipment and have become the top destination for landing India’s exports.

India has been traditionally exporting defense equipment to many countries including Italy, Israel, Egypt, Poland, Armenia, Philippines along with a majority of the neighboring states. According to Stockholm International Peace Research Institution (SIPRI) data on international arms transfer trends, roughly 50 percent of India’s defense exports from 2017 to 2021 were to Myanmar followed by Sri Lanka at 25 percent.

Thus far, the exports have been petty military hard wares, bulletproof helmets, pellets, mosquito nets along with small arms and ammunition. This is changing, especially with the roll-out of the Defense Acquisition Procedure (DAP) 2020, which introduced the ‘Make in India’ and ‘Aatmanirbhar Bharat’ initiatives. Now, the onus lies in scaling up indigenous industries and producing high-value defense products while balancing the traditional requirements.

India is aware that the world is facing a wavering geo-political shift each day and as a responsible nation, it can provide the much-required balance, stability and security in these shaky times.

As witnessed in the present decade, the military misadventures first in Nagorno-Karabakh and then in Ukraine, have shown glimpses of what future wars would look like. Various defense experts claim these to be only teasers of what the future holds. India needs to look at producing indigenously advanced weapons in all domains as wars are becoming hybrid and there is and will be a higher demand for emerging technology weapons worldwide.

Indigenous 21-gun Salute!
India while celebrating its 75th Independence Day this year from the ramparts of the Red Fort marked a new beginning. The celebrations were marked with a ceremonial 21-gun salute, and it was the first time indigenously developed equipment was used. The Indian-made Advanced Towed Artillery Gun System (ATAGS) has now bagged an export order worth $ 155 million.

To achieve the target of $5 billion worth of export by 2025, India would continue to cater to emerging nations, and also look out for prospective new buyers.

A long journey towards self-sufficiency
It was in year 1961 when Hindustan Aeronautics Limited (HAL), a state-owned aerospace and defense company built India’s first fighter-bomber aircraft HAL HF-24 Marut. The HAL produced the first single-engine Light Combat Aircraft (LCA) ‘Tejas’, which became operational in 2016 and was inducted for use in the air force and naval forces. After competing with other LCAs from countries such as South Korea and China, it became Malaysia’s first choice which has requested a proposal for 18 twin-seater Tejas.

In central Asia, India has signed a deal with Armenia over the selling of the indigenously built multi-rocket launcher system ‘Pinaka’ and Anti-Tank Guided Missile ‘Nag’. The former marked the very first export order for an indigenously built defense system. Nigeria and Indonesia are also in the line to purchase the ‘Pinaka’. Armenia is now looking at procuring another indigenously built ‘Akash’ Surface to Air Missile (SAM) system and has requested a proposal.

Defexpo’22 held recently in Gujarat, showcased only ‘made in India’ equipment. The Indian industry as well as Foreign Original Equipment Manufacturers (OEMs) such as Boeing and Lockheed Martin were also a part of and showcased joint-venture and jointly produced equipment.

The earnings from the exports would have multiplier effects:
  • -Increase in the foreign exchange reserves
  • -Boost to the MSMEs and private players
  • -Producing critical and emerging technologies
  • -Becoming a net security provider.
  • -US sharing the export pie?
According to a report by Statista, a Germany-based private organization that provides statistics and data about various issues reports that the Indian Defense Ministry and the US Department of Defense together employ 5.83 million people.

With industrial corridors being set up in the Indian states of Uttar Pradesh and Tamil Nadu, large skilled and semi-skilled workforces available and many more entering defense manufacturing, the bilateral partnership has the potential to address larger concerns of the world.

India and the US signed the historical framework of Defense Technology Trade Initiative (DTTI) in 2012, for facilitating defense trade between the two countries and eliminating bureaucratic obstacles but has not made significant progress so far.

The aim of the DTTI remains to create opportunities for the co-production and co-development of defense equipment but no path-breaking bilateral partnership has been inked. The non-accomplishment of DTTI and joint production has met some challenges across sharing high-end technology and producing next-generation military hardware.

The India-American Congressman Ro Khanna has time and again reiterated that the U.S. needs a strong defense and strategic partnership with India and a step in this direction would be confirming an American Ambassador to India. The position has been vacant since 2020.

The US military which is at a growing risk of not being able to meet the demands of defending America’s vital national interests and faces global challenges may find a natural partner in India. Meanwhile, exports are promoted with a transparent policy and nations should take a step forward to co-produce and co-manufacture in India.

In light of the above, India and the U.S. have signed a new Space Situational Awareness agreement forging the way to more advanced cooperation on new technologies and emerging domains like space and cyberspace. Citing another step taken in the right direction, India’s decision to join Combined Maritime Forces (CMF) in Bahrain and various military exercises with the US, showcases the willingness of the US and India to deepen the cooperation which is a win-win situation for both.

India has substantially increased the value of exports by six-fold since 2014. With constant threats at her borders, India is prioritizing security by achieving self-sufficiency and self-reliance. India is the fifth largest economy, and continuously trying to boost her industrial and manufacturing prowess. The aim is to transform towards making a ‘Modern and Aatmanirbhar Bharat’ driven by the ‘Atma-Shakti’ of self-sufficiency for a free, secure and prosperous world.

Pradeep S. Mehta is Secretary-General, and Purushendra Singh is a policy researcher at CUTS International, a global public policy research and advocacy group situated in New Delhi, Washington DC, and Geneva.

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