Amid resource crunch, India aims to double defence exports in 5 years

Published February 5, 2020
In this handout photo provided by the Press Information Bureau, Indian Prime Minister Narendra Modi holds a rifle during a visit to a pavilion at the DefExpo at Lucknow, India, Wednesday. — PIB via AP
In this handout photo provided by the Press Information Bureau, Indian Prime Minister Narendra Modi holds a rifle during a visit to a pavilion at the DefExpo at Lucknow, India, Wednesday. — PIB via AP

India wants to double defence exports over the next five years, Prime Minister Narendra Modi said on Wednesday, as the country seeks to cut its import bill amid a funding crunch that has forced successive governments to go slow on new orders.

“For several years India has been a net importer of defence products. We have taken measures to change it since 2014,” Modi said in the northern city of Lucknow, addressing the inaugural ceremony of India's 11th defence expo.

“Our aim is to increase exports of defence products to five billion dollars in five years,” Modi said, adding that India exports about 170 billion Indian rupees ($2.4 billion) of defence products.

India's defence export ambitions are soaring as Asia's third-largest economy suffers its worst slowdown in decades with the country's economic growth dropping to 4.5 per cent in July-September quarter – its lowest quarterly growth in six years.

Between 2013 and 2017, India was the world's top arms importer, accounting for 12pc of total imports globally, with Russia, Israel and the United States among the top suppliers.

According to government data, India's major defence export customers include Italy, Sri Lanka, Russia and France.

The exports, primarily made by government ordnance factories and private firms such as L&T, Bharat Forge and Tata group, include offshore patrol vessels, helicopters, coastal surveillance systems and spares for radar.

India's armed forces, saddled with outdated aircraft and warships, are in dire need of funds for modernisation.

However, with the government possibly set to break its own fiscal deficit target due to slowing growth, funds allocated for modernisation have been barely enough, experts have said.

Laxman Behera, research fellow at Institute for Defence Studies and Analyses, said in a report released on Tuesday that India's defence resource crunch had been acute in recent years.

India's budget for modernisation of weapons, aircraft and warships announced by Finance Minister Nirmala Sitharaman last week stood at 906 billion INR, out of a total allocated defence budget of 3,230.5 billion INR.

With a meagre hike of 2.55 billion INR over the revised estimates of last year's budget, Laxman from IDSA called funding for the country's military "grossly under-provisioned".

US ambassador to India Kenneth Juster said lower offset obligations, a mandatory financial commitment locally by global firms partnering with India, and less regulations can help India bring in billions of dollars in foreign investment. ($1 = 71.1800 Indian rupees)

Opinion

Editorial

Judiciary’s SOS
Updated 28 Mar, 2024

Judiciary’s SOS

The ball is now in CJP Isa’s court, and he will feel pressure to take action.
Data protection
28 Mar, 2024

Data protection

WHAT do we want? Data protection laws. When do we want them? Immediately. Without delay, if we are to prevent ...
Selling humans
28 Mar, 2024

Selling humans

HUMAN traders feed off economic distress; they peddle promises of a better life to the impoverished who, mired in...
New terror wave
Updated 27 Mar, 2024

New terror wave

The time has come for decisive government action against militancy.
Development costs
27 Mar, 2024

Development costs

A HEFTY escalation of 30pc in the cost of ongoing federal development schemes is one of the many decisions where the...
Aitchison controversy
Updated 27 Mar, 2024

Aitchison controversy

It is hoped that higher authorities realise that politics and nepotism have no place in schools.