About ₹70,000 crore of the capital allocation of ₹1.35 lakh crore in the defence budget will be reserved for domestic procurements, Defence Minister Rajnath Singh said on Monday while stating the Ministry will soon issue a second negative list of items which can only be procured locally by the Services.

“My Ministry has planned to invest, about 63% of the outlay for 2021-22 on domestic procurement, i.e. about ₹70,221 crore for domestic defence procurement during for 2021-22,” Mr. Singh said speaking at a webinar organised by Depart of Defence Production and Society of Indian Defence Manufacturers.

Speaking of the separate allocation for domestic procurement, Prime Minister Narendra Modi in his address urged the private sector to come forward in manufacturing as well as in design and development, showcasing India’s glory worldwide.

In the budgetary allocation for 2021-22, the capital allocation for defence saw an increase of ₹21,326 crore or 18.75% compared to Budget Estimates (BE) of last year. The total allocation for defence in the Union budget is ₹4.78 lakh crore including defence pensions, which stood at ₹1.16 lakh crore. Last year, for the first time, the government introduced a separate allocation for domestic procurement within the defence budget and had reserved ₹52,000 crore for 2020-21.

As part of a series of efforts to streamline defence procurement, Mr. Singh said the Ministry is also working on bringing down the delays in timelines of capital acquisition. “We will make efforts to complete the defence acquisition within 2 years, instead of the existing 3-4 years being taken on the average,” he said.

Last year, Defence Ministry had notified a list of 101 items on the negative import list and Mr. Singh said they intend to notify the next list of items and request Secretary Department of Military Affairs (DMA) that they should also consider including certain spares currently being procured from outside so that could also be indigenized.

“The embargo on imports is planned to be progressively implemented between 2020 to 2024. All necessary steps would be taken to ensure that timelines for production of equipment as per the negative import list are met,” he stated.

Mr. Modi termed the negative list for imports as a positive list in the language of self-reliance. It is a positive list on the strength of which our own manufacturing capacity is going to increase, he stated. Stating that it is the positive list which is going to reduce dependence on foreign countries for defence needs, Mr. Modi said this is a positive list, because of which products made in India are guaranteed to be sold in India.

Defence exports

Both Mr. Modi and Mr. Singh stressed on simultaneously boosting defence exports while reducing imports.

Our initiatives have resulted in staggering 700% growth in defence exports in the last six years, Mr. Singh said adding India entered in the list of top 25 Exporters in the world as per data published by Swedish think tank SIPRI in 2020.

Stating that India had century-old experience in making arms and ammunition, and had supplied them during WW-I and WW-II, Mr. Modi said post-independence the situation deteriorated, even for small arms we are relying on imports. Noting that today was one of the largest defence importers, Mr. Modi added, “It is not an achievement.”

Stressing on defence exports, Mr. Modi said the changing geopolitical reality is that many small nations are now worried about security. They will look towards India as we have the strength of low cost, high quality production. We are exporting to over 40 nations now. We now have to emerge as a global exporter.

Early this month at Aero India, an order was placed with Hindustan Aeronautics Limited (HAL) for 83 Light Combat Aircraft (LCA) at a cost of ₹48,000 crore. On this, Mr. Modi said their their government relied on the capabilities of its engineers and scientists and today Tejas is gracefully flying in the sky.