New copters to enable tech transfer

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Mains Paper 3: Science & Technology | Indigenization of technology & developing new technology

From UPSC perspective, the following things are important:

Prelims level: New SP Model

Mains level: India’s strides in defense technology sector and need for further development.


News

New Strategic Partnership model for defence purchase

  1. The Defence Acquisition Council (DAC), chaired by Defence Minister accorded approval for procurement for the Services amounting to approximately Rs. 46,000 crores.
  2. The Defence Ministry is expected to release project-specific implementation guidelines for the 111 naval utility helicopters to be procured under the Strategic Partnership (SP) model.
  3. However, foreign companies say there is still some clarity required on crucial legal, liability and technology transfer issues.

Particulars of the new SP Model

  1. This is the first project under the MoD’s prestigious Strategic Partnership (SP) Model that aims at providing significant fillip to the Government’s ‘Make in India’ programme.
  2. SP Model envisages indigenous manufacturing of major defence platforms by an Indian Strategic Partner, who will collaborate with foreign OEM, acquire niche technologies and set up production facilities in the Country.
  3. The model has a long-term vision of promoting India as a manufacturing hub for defence equipment thus enhancing self-sufficiency and establishing an industrial and R&D ecosystem, capable of meeting the future requirements of the Armed Forces.
  4. The contract when finalised, would result in a vibrant and wide-spread Defence industrial eco-system in the Indian Aviation Sector with the Private Industry and MSMEs as major stakeholders.

Why such Partnership?

  1. There are two important issues that need clarity. One is legal, as the companies can’t sell a submarine or fighter jet to a private company. Global regulations do not allow that.
  2. So, there has to be a government-to-government component in the end.
  3. The other issue was about the liability of the end product.
  4. This liability issue was one of the major reasons the earlier medium multi-role combat aircraft (MMRCA) deal for 126 jets got derailed at the contract negotiation stage.
  5. Hence the Dassault Aviation refused to stand guarantee to the aircraft manufactured by Hindustan Aeronautics Ltd. (HAL).

Large Infrastructure still under-utilized

  1. For the first time, under the SP model, Indian private companies will get to tie up with global original equipment manufacturers (OEMs) and build major defence platforms in India under technology transfer.
  2. So far, it was defence public sector undertakings (DPSUs) which played the lead role.
  3. There is large infrastructure already present in the country with DPSUs and this must be utilized for the benefit of both the country as well as form a business sense.

Need for Clarity in terms for production

  1. All procurement under the SP model would be executed by specially constituted empowered project committees (EPC) to ensure timely execution.
  2. There is need for some clarity from the MoD on production transfer and technology transfer as well, the executive added.
  3. Earlier the Defence Acquisition Council (DAC) cleared the general as well as project-specific implementation guidelines for the naval helicopters that would lay emphasis on transfer of technology and high absorption of indigenous content.
  4. The guidelines and the qualification guidelines are yet to be communicated to the industry.
Defence Sector – DPP, Missions, Schemes, Security Forces, etc.
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