Procurement of Defence Equipment

Procurement of defence equipment is made by the Government from various indigenous as well as foreign sources to meet the requirements of the Armed Forces. The import option is exercised when it is necessary to procure the items within a definite timeframe on operational grounds to bridge the capability gaps and normally when such equipment cannot be sourced indigenously within a specified timeframe.>> Expenditure incurred on import of defence equipment during the last three years is as follows:>> Year/Expenditure Incurred On Import Of Defence Equipment> (Rupees in Crores)>> --2005-06: 12101.49>> --2006-07: 10022.00>> --2007-08: 15026.68>> Major countries from which the imports are made include Russia, the USA, the UK, France, Germany and Israel. Divulging further details with regard to import of defence equipment will not be in the national interest.>> Steps taken to encourage indigenous manufacturing include:> (a) rationalization of offset policy to include offset credit banking to enable creation of offset programmes by foreign participants in anticipation of future obligations;> (b) products developed by the respective Workshops of the Armed Forces for in house requirements can be procured from these agencies under `Buy (Indian) category;> (c) provision of Transfer of Technology, if required, to an Indian public/ private firm for providing maintenance infrastructure to be applicable for `Buy category cases, where equipment is being bought from foreign vendors; and> (d) procurement under `Buy (Indian) category to have minimum 30% indigenous content if the systems are being integrated by an Indian vendor.