Ministry of Defence has signed a contract with Airbus Defence

Dec 23: Ministry of Defence has signed a contract with M/s Airbus Defence and Space, S.A. Spain on 24th September 2021 for procurement of 56 C-295MW transport aircraft for the Indian Air Force to replace the ageing AVRO fleet. Under this contract, 16 aircraft will be delivered in ‘Fly Away’ condition and 40 aircraft will be manufactured in India by M/s Airbus selected ‘Tata Consortium’ of Tata Advanced Systems Limited (TASL) and Tata Consultancy Services (TCS) with TASL as prime.

The Government has taken several policy initiatives in the past few years and brought in reforms to encourage indigenous design, development and manufacture of defence equipment, thereby promoting self-reliance in defence manufacturing & technology in the country. These initiatives, inter-alia, include according priority to procurement of capital items from domestic sources under Defence Acquisition Procedure (DAP)-2020; Announcement of 18 major defence platforms for industry led design & development in March, 2022; Notification of four ‘Positive Indigenisation Lists’ of total 411 items of Services and three ‘Positive Indigenisation Lists’ of total 3,738 items of Defence Public Sector Undertakings (DPSUs), for which there would be an embargo on the import beyond the timelines indicated against them; Simplification of Industrial licensing process with longer validity period; Liberalisation of Foreign Direct Investment (FDI) policy allowing 74% FDI under automatic route; Simplification of Make Procedure; Launch of Mission DefSpace; Launch of Innovations for Defence Excellence (iDEX) scheme involving start-ups & Micro, Small and Medium Enterprises (MSMEs); Implementation of Public Procurement (Preference to Make in India) Order 2017; Launch of an indigenization portal namely SRIJAN to facilitate indigenisation by Indian Industry including MSMEs; Reforms in Offset policy with thrust on attracting investment and Transfer of Technology for Defence manufacturing by assigning higher multipliers; Establishment of two Defence Industrial Corridors, one each in Uttar Pradesh and Tamil Nadu; Opening up of Defence Research & Development (R&D) for industry, start-ups and academia by earmarking 25 percent of defence R&D budget; and Progressive increase in allocation of Defence Budget of military modernization for procurement from domestic sources, etc.

To enhance functional autonomy, and efficiency and unleash new growth potential and innovation in Ordnance Factories, the production units of the erstwhile Ordnance Factory Board have been corporatized into 7 Defence Public Sector Undertakings with 41 units, with effect from 1st October 2021.

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