By: Vivek Raghuvanshi
NEW DELHI — India's effort to boost the private sector defense industry by exclusively providing big-ticket orders on nomination basis through the enactment of the Strategic Partners policy faces delays.
The current finance minister, Arun Jaitley, who on March 13 also became the country's defense minister, wants to make sweeping changes in this space.
Defense projects worth more than $35 billion hinge on the Strategic Partners policy, which has been awaiting adoption for a year, a senior Ministry of Defence official noted.
Jaitley's modified Strategic Partners policy could include the selection of at least three or four private sector companies from the nominated production agencies, as opposed to the earlier proposal of selecting one or two.
An additional change could include "not giving big-ticket defense contracts exclusively on nomination basis, as is presently being given to the state-owned defense companies but through competition," the MoD official said.
"In the absence of a (Strategic Partners) policy, all orders for major platforms will continue to go to the public sector," according to Vivek Rae, a former MoD director general for defense procurement. "Policy regarding strategic partnerships with defense industry, including private sector, is very important for development of the defense industrial base in the country."
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