Modi’s plans to make India a manufacturing hub may not be entirely unachievable

Prime Minister Narendra Modi’s assertion on protecting citizens and ensuring the territorial integrity of India was jingoistic for some. For his core ‘ultra-nationalist’ political constituency, these assertions are seen as bravado. Modi’s speech at the Indian Defence Expo at Mahabalipuram near Chennai, was a significant departure from such events in the past. His ‘emotional connect’ with the people on the border situation and the testy balance of power situation globally will enable him to get support for spending to maintain Indian security interests. In an election year, whipping up nationalist sentiments is not a bad ploy to retain the core constituency ahead of the next Lok Sabha elections, due a year from now. The Prime Minister saw lethargy and inaction as the ‘stated policy’ of previous Congress-led UPA government with regard to defence issues. Pointing to policy paralysis impacting ‘India’s defence preparedness’ seems to be a well thought out strategy to continue discrediting the UPA. But there seems to be an element of truth in his campaign mode speech at the defence expo. For instance, the NDA government cleared permission for 794 export proposals worth $1.3 billion. This is against 118 proposals for export worth $577 million. For a nation with 1.3 billion people, these figures may appear unimpressive. But then, some beginning has to be made for turning India into a major defence exports manufacturing hub. Modi’s lofty plans to make India a major defence-manufacturing hub for the army, navy and airforce may not be entirely unachievable. If worked with diligence, India can easily surpass the defence industry revenues of Rs 1,70,000 crore by 2025. Already, India’s defence sector revenues have touched Rs 55,894 crore in 2016-17 from an earlier Rs 43,746 crore in 2013-14. Some beginning has been made. The implementation of defence manufacturing plans by government companies, domestic and foreign players needs to be hastened. For that to happen, easing the industrial licensing regime and having simpler rules and regulations for companies to set up manufacturing bases in India would be paramount. Importing 110 fighter jets may address the immediate requirements of our armed forces. But, expanding the defence industry base in India is the biggest challenge. For instance, getting Lockheed Martin to set up the F-16 fighter jets base in India should be actively pursued and realised. Similarly, the French government should allow its defence companies to move their huge manufacturing set up to India. Given that orders for the supply of 36 Rafale aircraft have been placed in an inter-government contract, the next big step would be to manufacture these fighters in India itself. India will have to deftly pursue such opportunities for big ticket deals in the defence space. But, small and medium projects cannot be ignored. Since the BJP would also gain from such a policy, the NDA government under Modi will have to pursue the case with companies that have showcased their technology prowess in Mahabalipuram. Huge investments have the potential to make the defence sector a major provider of jobs, it is all the more reason for Modi to clinch as many deals, as early as possible.