At the upcoming Defense Acquisition Board (DAC) meeting, the Narendra Modi government is expected to approve amendments to the Defense Acquisition Procedure (DAP) to allow India’s private sector to engage in research and defense development (R&D) through special purpose vehicles and in collaboration with defense public sector companies (DPSU).
According to officials familiar with the developments, the amendments will allow the Indian private sector to acquire a major stake in the defense R&D companies, which will be created for the development of major hardware platforms like drones, helicopters, advanced aircraft and submarines. This is a groundbreaking development as until now only DPSUs and government labs were allowed to do defense R&D, with only minor elements being exposed to private R&D. This is in line with the Defense Budget, where it was announced that 25% Defense R & Budget D would be spent on these platform-specific SPVs with the private sector.
Given the global turmoil unleashed by the war in Ukraine and Chinese belligerence in the Indo-Pacific, India has no choice but to make defense R& D competitive because the public sector alone cannot meet the growing needs of the Indian defense platform in the time available. The global defense market is set to face new challenges as countries like Japan, Germany, ASEAN, South Korea and Eastern European countries will seek more weapons in the United States to deter Russia and China, and the latter will reduce its exports to service their own needs. India has no choice but to develop and manufacture hardware platforms itself, as its main supplier, Russia, is focused on the war in Ukraine and it is only a matter of time when the shortage of spare parts hits the Indian Armed Forces.
While the Defense Research and Development Organization (DRDO) has developed hardware platforms over the decades, the entry of the private sector into defense R&D will give India more options to develop ranged weapon systems like long-endurance armed drones, anti-drone systems, 12-ton multi-role helicopters, the next generation of combat aircraft, and possibly nuclear-powered submarines and conventionally armed.
The issue has become urgent because China has been able to develop high-altitude, long-endurance armed drones like the Wing Loong 10, which is powered by turbofan engines like the state-of-the-art US armed drones. India, on the other hand, still relies on Israel upgrading its medium-altitude, long-endurance drones and has no answer to the long strides that China or for that matter Iran and Turkey have made. caught up in the development of unmanned aircraft systems.
Author of Indian Mujahideen: The Enemy Within (2011, Hachette) and Himalayan Face-off: Chinese Assertion and Indian Riposte (2014, Hachette). Awarded K Subrahmanyam Prize for Strategic Studies in 2015 by Manohar Parrikar Institute for Defense Studies and Analysis (MP-IDSA) and Ben Gurion Prize 2011 by Israel.
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