80% of component and assemblies of weapon systems and aircraft are made by MSMEs
Updated: Dec 08, 2015 05:17:50pm
New Delhi, Dec 8 (KNN) A Committee of Experts set up by Ministry of Defence mentioned in its report that almost 80% of component, aggregates and assemblies of complex weapon system and aircraft are made by MSMEs, which are part of supply chains, Minister of State for Defence, Rao Inderjit Singh said.
In a written reply in Rajya Sabha today, the Committee under the Chairmanship of Dhirendra Singh, in its report also mentioned that there are nearly 6000 MSMEs across the country supplying components and sub-assemblies to the DPSUs, Ordnance Factories, DRDO and private industries.
However, according to industry sources participation of MSMEs in defence capital acquisition is miniscule and the rosy picture may have been painted to avoid MSME focused initiatives in the new Defence Procurement Policy (DPP 2015) to be announced soon. The task Force constituted by the defence ministry to develop a road map for DPP 2015 also appears to have looked away from the MSME sector.
To highlight the potential of the MSME sector as a supplier of components and sub-assemblies for defence systems and create a niche market for MSMEs in defence acquisitions, FISME the leading federation of Indian MSMEs organised an interactive seminar which was addressed by Shri Manohar Parikkar, Raksha Mantri. During the seminar crucial issues like reservation for MSMEs in defence procurements, waival of GFR conditionalities, institutional support and capacity building of MSMEs were discussed.
Government has announced guidelines for DPSUs and OFB to promote the participation of private sector, particularly SMEs for defence manufacturing, Outsourcing and Vendor Development. The guidelines mandate that each DPSU and OFB to have a short-term and long-term outsourcing and vendor development plan to gradually increase the outsourcing from private sector including SMEs. The guidelines also include vendor development for import substitution.
The moot question remains how much the above measures will help in participation of MSMEs in defence acquisitions. India predominantly procure the weapon systems and platforms from foreign companies and till MSMEs are enabled to function as their tier I or tier – II vendor, MSMEs will stagnate as supplier of mundane items like ammunition boxes and barrack blankets to defence forces.
In its memorandum to the Raksha Mantri on behalf of the MSME sector, FISME has identified the need for easy finance, development of specialised defence clusters etc. for capacity building of MSMEs for participation in defence procurement. FISME also suggested for establishing a institutional support system in the line of United States Department of Defence small business initiative.
However, it appears Government is complacent with whatever has been done. (KNN Bureau)
In a written reply in Rajya Sabha today, the Committee under the Chairmanship of Dhirendra Singh, in its report also mentioned that there are nearly 6000 MSMEs across the country supplying components and sub-assemblies to the DPSUs, Ordnance Factories, DRDO and private industries.
However, according to industry sources participation of MSMEs in defence capital acquisition is miniscule and the rosy picture may have been painted to avoid MSME focused initiatives in the new Defence Procurement Policy (DPP 2015) to be announced soon. The task Force constituted by the defence ministry to develop a road map for DPP 2015 also appears to have looked away from the MSME sector.
To highlight the potential of the MSME sector as a supplier of components and sub-assemblies for defence systems and create a niche market for MSMEs in defence acquisitions, FISME the leading federation of Indian MSMEs organised an interactive seminar which was addressed by Shri Manohar Parikkar, Raksha Mantri. During the seminar crucial issues like reservation for MSMEs in defence procurements, waival of GFR conditionalities, institutional support and capacity building of MSMEs were discussed.
Government has announced guidelines for DPSUs and OFB to promote the participation of private sector, particularly SMEs for defence manufacturing, Outsourcing and Vendor Development. The guidelines mandate that each DPSU and OFB to have a short-term and long-term outsourcing and vendor development plan to gradually increase the outsourcing from private sector including SMEs. The guidelines also include vendor development for import substitution.
The moot question remains how much the above measures will help in participation of MSMEs in defence acquisitions. India predominantly procure the weapon systems and platforms from foreign companies and till MSMEs are enabled to function as their tier I or tier – II vendor, MSMEs will stagnate as supplier of mundane items like ammunition boxes and barrack blankets to defence forces.
In its memorandum to the Raksha Mantri on behalf of the MSME sector, FISME has identified the need for easy finance, development of specialised defence clusters etc. for capacity building of MSMEs for participation in defence procurement. FISME also suggested for establishing a institutional support system in the line of United States Department of Defence small business initiative.
However, it appears Government is complacent with whatever has been done. (KNN Bureau)
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