Gujarat To Become Defence Manufacturing Hub Soon: Defense Minister Of India

Gujarat is likely to become a major defense manufacturing hub with a number of private sector companies planning to set up factories in the state.

The centre has approved close to 20 licences for defence production in Gujarat, defence minister Manohar Parrikar was quoted as saying Live Mint on Thursday.

The defense sector is encouraging products that are “designed and developed” in India, aimed at building, enhancing and promoting the designing capabilities of Indian manufacturers, he said while speaking at a seminar at Vibrant Gujarat Global Summit in Gandhinagar.

“In turn, this will help them manufacture world-class products on the back of the ‘Make in India’ program.” He added.

Meanwhile Gujarat Chief Minister, who also spoke at the event, said an agreement has been signed between Airbus France and Dholera Industrial City Development Ltd (DICDL) of the government of Gujarat for setting up of an aerospace and defence cluster. “The state government is in the process of investing Rs3,000 crore on infrastructure to develop the Dholera region as a world-class city.” The chief minister added.

This strategic partnership will also ensure the establishment of ancillary industries in this area, the Gujarat government said in a media statement.

An investment agreement between Anil Dhirubhai Ambani Group (ADAG)’s Reliance Defence and Engineering and Gujarat government was signed in the presence of the chief minister and defence minister with a proposed investment of Rs 2,500 crore in the defence sector in Gujarat.

Gujarat state of India has released an investor-friendly Aerospace and Defence Policy 2016 that offers incentives and tax sops in relation to land allotment, stamp duty, registration charges and electricity duty in December.

According to which the state would provide government land at 50% of jantri rates for setting up units during the five-year tenure of the policy to attract defence and aerospace sector players. Land owned by the state and Gujarat Industrial Development Corporation will be given first preference for land allotment.

The central government has made it a priority to modernize the Indian defence sector and lower India’s dependence on imports.

For this, the government has relaxed the Foreign Direct Investment policy in defence allowing foreign investments of up to 49% through the automatic route and above 49% under the approval route in cases where the investments result in access to modern technology.