5 Billion in 5 Years
For long, India was the largest importer of weapon systems. Recently overtaken by Saudi Arabia, it is not a position any Indian should mourn losing. Being the sixth largest economy in the world in dollar terms and third largest in PPP terms, with world class manufacturing, IT, software and space industry, it was actually a shame to be positioned as an importer of the very equipment that ensures peace to allow the economy to grow.
It is a known fact that a very large number of technologies are developed for the military and then introduced for the benefit of the general public. The internet, which has revolutionised the technology world and which touches the lives of nearly every human on earth was developed for the military. The Soviets excelled in developing systems, equipment and technologies for the defence services and then introducing into civil life. All other economies in the top five list are either exporters of weapon systems or self-sufficient.
In the early years of its life as an independent modern nation, India, based on certain ideological considerations decided not to export weapon systems to other countries. As a result, a culture developed which throttled innovation in weapon systems. There was a lack of funding for developing new weapons because the option of selling the same weapons for developing new systems was abandoned. As a result, these systems competed for the money which could be used for social development. The result was a lack of design and development capability for weapon systems. And this led to the situation where India became a mere importer of weapons. The market became constrained and there a was a glut of public sector companies producing systems under license with no ambition to grow. The private sector had literally no role to play.
The present government has realised the economic as well as geo-political significance of a vibrant weapons industry. It will not only unshackle the Indian armed forces from dependence on other countries but also earn foreign exchange to sustain the weapons industry while allowing India to influence the security scenario beyond our shore.
The government has declared an intent to export weapon systems worth ≈ INR 35,000 Crore (USD 5 Billion) over the next six years. They have empowered the military attaches to market Indian weapon systems. The advantage of this policy for the Indian private sector are immense. While the larger companies like Bharat Forge, Adani, Tata, Mazagon Dock, L&T and Mahindra will export complete systems and ships, the Micro Small and Medium Enterprises (MSMEs) will act as the components ecosystem. This opens a large opportunity for MSMEs as Tier 2 and 3 suppliers. Further, as most of the larger companies have joint ventures with the multinational power houses in the weapons industry, this opens up an opportunity for the MSMEs to supply directly to the larger MNCs also.
Defence Attaches are present in the various global capitals a carry the credibility provided by being the representatives of the Government of India. The targeted marketing by these officers and events organised by them would allow the MSMEs to target and network with the right people in foreign countries. Providing them with credibility and access at low cost. This would allow these companies to even sell their products directly to foreign forces.
The market being targeted by the Government of India is large, which included 85 countries. Several of these countries will get easy credit lines from the Government of India for buying the weapon systems on offer. So its time for the Indian companies to start thinking global and not limit their visions to servicing the Indian weapons market only.
Further, the armed forces do not only need weapons, sensors and communication equipment; they need uniforms, webbings, shoes, helmets, processed food, fire fighting equipment, spares, ground handling equipment, ropes, hawsers… the list is long. Companies can look at developing and supplying innovative solutions which meet these requirements also.
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