Why not working ‘Make in India’ initiative

Three years back, the BJP-led NDA government of Prime Minister Narendra Modi has embarked on an ambitious ‘Make in India’ programme to boost the country’s economy and for generation of employment.

The government had also sought to kill many birds with one stone, as the initiative was to make the country self-dependent in the field of defense and thus meet the challenge from China.

The Prime Minister was very categorical that defense production was the cornerstone of the ambitious ‘Make in India’ venture as it had huge potential of creating jobs.

Taking a close look at the progress of the much-desired initiative of the government, one reaches a conclusion that despite best intentions it has failed to deliver expected results as not much has translated on the ground owing to red tape and lack of clarity on several crucial issues.

The Ministry of Defence had issued Requests for Proposal (RFPs) for various categories of ammunition. Several issues had emerged at the pre-bid meeting held to clarify the queries of vendors. The Industry had sought many clarifications related to the RFPs and the user had agreed to most of queries raised by the industry. Corrigendum have been issued to clarify the points that were raised during the meeting.

However, there are still few very important issues that require to be addressed at the appropriate level by concerned trade chambers.

Original equipment manufacturers (OEMs), too, have raised pertinent issues during the pre-bid interaction. It was mentioned that it might not be possible to provide the drawings due to Intellectual Property Rights (IPR) However, drawings of ammunition for all the categories of ammunition would be required for designing of the ammunition. Many companies have the technology but need drawings to check if the round would qualify in the trials. Without the drawings, it is not feasible to manufacture the ammunition meeting the specifications of the RFP.

Further OEMs are requesting for characteristics of weapons systems/ platforms which are being used/ in service for designing the ammunition. This is an important issue since the ammunition is to be designed for in-service weapon platforms.

The OEMs need an end user certificate from the user to seek permission from their respective governments without which they are handicapped to transfer the technology.

Similarly, protection of IPRs is very important with the OEMs. They would like to have an undertaking from the Government that there would no infringement of IPRs. During the pre-bid meeting, it was mentioned that the drawings would have to be shared with the Director General of Quality Assurance (DGQA) since they are Army Holding Sealed Particular’s (AHSP) agency. Hence, it is recommended that there should be a tripartite agreement signed between the OEM, the Indian manufacturer and the DGQA on holding of IPRs.

According to the RFPs, certain key technologies like case, fuse, propellant etc. need to be absorbed by Indian companies as part of the indigenization process. The essence of the RFP to absorb the technology within the country is well understood. However, setting up of a propellant manufacturing plant is not a viable proposition since cost of installing such a plant is not only prohibitive but is also not commensurate with the requirement. Therefore, it is recommended that the establishment of a propellant manufacturing plant should be delinked with the current RFPs. A separate RFP for propellant manufacturing or explosives could be issued and companies already in the business of manufacturing explosives could bid for the project or companies bidding for the RFPs of ammunition manufacturing could buy propellant directly from Ordance Factories Board (OFB).

Since the Government has been laying lot of emphasis on ‘Make in India” initiative and is stressing upon ‘Swach Bharat Abhiyan’, it is high time to bring changes in the manufacturing processes of the domestic industry by enabling the industry to produce internationally compliant military grade equipment.

Some of the standards that need inclusion in our tenders are the environmental (ISO-14001:2004) and the OHSAS standards (OSHAS-18001). These standards are extremely important in the present day context for maintaining clean environment and ensuring Health and Safety of workers. Inclusion of these standards by the domestic industry will make the products acceptable in global markets thus imparting impetus to exports.

It is worth noting that one of the reasons why foreign OEMs with offset obligations have been slow in discharging these obligations is because of a lack of quality manufacturers in the Defence Sector that meet with all the established industrial standards. Compliance to these standards will enable the industry to meet the international norms.

In Europe, these standards form part of the Request for quotation (RFQs) that are issued from time to time. If India wants its products to be accepted globally and also strengthen the manufacturing process of the domestic industry these standards should be made mandatory and included in all domestic tenders.

In few words, the ISO-14001 is the criteria followed by a company that stipulates the standards to identify and control its environmental impact and with this they can constantly improve on their performance on the environmental front.

Similarly, the OHSAS 18001 is an internationally recognized occupational, health and safety management system series standard. An organisaton must have a health and safety management system complaint with the requirements of the OHSAS 18001 standard to enable it to get a certification.

There is an urgent need to address these issues so that ‘Make in India’ initiative could achieve its full potential creating employment and making the country self-reliant in the field of defence.

(Shobha Mishra)