DPrP 2011 versus DPrP 2018

Preshit Parihar 3rd July 2018

The Defence Production Policy (DPrP) 2011 was issued by the Department of Defence Production (DDP), Ministry of Defence (MoD). It outlines the framework within which domestic industries are expected to pursue indigenous design and manufacture of defence equipment.The policy recognises Micro, Small andMedium Enterprises (MSMEs) as an integralpart of the defence production supply chains. As per policy guidelines, manufacturers of the equipment or platform are required to purchase at least 20 per cent of components or raw materials from domestic vendors, mainlyMSMEs. However, the clause does not elaborate on indigenous content within the material supplied to the manufacturer,which are the Defence Public Sector Undertakings (DPSUs) for the most part. This provides room for MSMEstoimport the materials or components for supply to the DPSU; which is against the spirit of indigenization goals

The policy mentions the role of strategic partners and their importance for offset management owing to globalized defence production. Sustainability and preference for indigenously designed, developed and manufactured (IDDM) products has beenreiterated in DPrP 2018. The policy provides for a separate fund for MSMEstosupport development of equipment. However, the distribution strategy for the fundis missing.

DPrP 2018 essentially expands on the goals of the 2011 policy. The 2018 policy explains and simplifies various aspects of the guidelines laid down earlier. It acknowledges the fact that significant quantity of weapons continue to be importeddespite the stipulations given inDPrP 2011.The policy also lays down goals to expand the research and development (R&D) activities of both public and private enterprises in defence. Goals such as strategic independence, sovereign capability in selected areas, cost effective defence equipment and collateral benefits ensuing from endeavours of the defence industry set out in DPrP 2018 show a clearer and better articulated policy perspective.

Considering th...

Note: Views expressed in this blog are those of the author.