India emerging as ‘defence outsourcing hub’

16 February 2010

16 February 2010 | Jake Kanter

India is becoming a preferred outsourcing location for the defence industry, according to defence minister Shri AK Antony.

Speaking at a military conference in New Delhi yesterday, Antony said deals worth more than 8,000 crores (£1.1 billion) had been signed since 2001 and the country was fast emerging as an outsourcing hub for the rest of the world.

“The Indian defence industry has matured and evolved over the years. It has developed capabilities in land, naval and air systems,” he said.

The minister explained that the conference was an opportunity to showcase the country’s ability to “design, develop and deliver a wide range of military and civil products and services to meet stringent specifications at competitive prices”.

Last year the Indian government set out plans to boost the capability of its manufacturing industry through a “Buy and Make (Indian)” purchasing provision. This opens up contracts to local suppliers capable of forming joint ventures with more established foreign competitors and carrying out some manufacturing on their behalf.

Antony added that India’s defence spending will increase in line with the country’s predicted GDP growth of 8-10 per cent over the next two decades.

The government is to publish a “technology perspective and capability roadmap”, which will set out the needs of India’s armed forces as part of plans to boost procurement transparency.

Last week India joined the World Trade Organization's Government Procurement Agreement as an observer.

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