India Development News & Foreign Investment Opportunities

Aerospace and Defence expects US$10bn investments

Defence Startups being nurtured


Defence Startups being nurtured




The aerospace and defence goods & services is expected to win US$10 billion investment by 2025, given that Defence Ministry has taken various initiatives that has increased exports.

Giving this projection, Defence Minister Rajnath Singh the initiatives include simplification of procedures for exports, simplification of industry licensing process, increase in Foreign Direct Investment (FDI) cap, streamlining of defence offset policy and making government trial and testing facilities available to the private sector.

He pointed out that a new category ‘Buy Indian – IDDM (Indigenously Designed, Developed and Manufactured) was introduced to promote indigenous design and development of defence equipment when the ‘Defence Procurement Procedure’ was revised in 2016.

The government’s desire to establish two defence corridors in Tamil Nadu and Uttar Pradesh is clear. A Defence Innovation Hub is already functioning in Coimbatore. A Defence Planning Committee has also been formed.

Additionally, the Uttar Pradesh State Government plans to build a defence manufacturing corridor along with the proposed Bundelkhand Expressway which will help in making India self-reliant in the field of defence production, Singh said.

The Minister also highlighted the Government has undertaken far-reaching reforms in the last five and a half years to increase synergy between public and private sector.

It has contributed positively in defence production and procurement. He said, work is on to introduce a common testing and certification scheme under a Public Private Partnership model to create an enabling environment.

Singh voiced the Government’s resolve to promote self-reliance in defence through five I’s — Identification, Incubation, Innovation, Integration and Indigenisation.

The Ministry has also set a target to fund 250 startups, 16 personal initiatives and five Defence Innovation Hubs through Defence Innovation Organisation (DIO) in the next five years.

He hoped that at least 50 technological designs would be made to meet the requirements of the Armed Forces.

A Defence Innovation Fund is also being prepared to support government participation through equity investment in defence startups.

“A new Transfer of Technology (ToT) policy is being created to simplify the way of transferring technology developed by DRDO to the industry. So far, more than 900 ToT licensing agreements have been signed with industries which is a major step towards making the defence manufacturing sector self-sufficient,” said Singh during a business seminar ‘India Rising’, at ‘Defence & Security Exhibition 2019’ in Bangkok on 18 Nov 2019.

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