MSMEs want simple defence purchase policy

Ahead of the new Indian Defence Procurement Policy (DPP) promised by Defence Minister Manohar Parikkar at the Vibrant Gujarat Summit, the micro, small, and medium enterprise (MSMEs) players clamoured to make it simple and industry-friendly at a one-day seminar organised by the Bangalore Chamber of Industry and Commerce (BCIC) here on Wednesday.

The seminar on ‘Defence Offsets and FDI – the Enablers for Development, Growth of Indian Aerospace, Defence Industry and its Integration in Global Supply Chain’ was organised by the BCICI’s task-force on aerospace and aviation and in association with Hindustan Aeronautics (HAL).
Speaking at the seminar, Alpha Design Technologies Chairman and Managing Director H S Shankar said offsets and FDI should be vendor-driven and not targeted.  “We should have clarity on intellectual property (IP) and export of  products manufactured under this offset clause. Also product tax issues should have a clarity,” he said. 

DPP 2013 opened up Rs 90,000-crore offset opportunity for the defence players in defence public sector undertakings (DPSUs), enterprises as well as for the MSME sector.Anupam Srivastava, business advisor to SKP Business Consulting, said the offset clause also should encourage  Indian SMES to reinvent themselves and be competitive in the market. 

“The new policy is an enabler to make Indian defence production industry competitive. All defence and aerospace related product development products will take long gestation period. Here the risk factor and money for the funding is enormous. MSMEs should have a clarity on these fronts.”
Naresh Patla, CEO (aerospace and defence division), Maini Group, said the offset clause should move from government to OEMs and their partners so that the industry take on the opportunity of the $130-billion modernisation programme of the armed forces in  the coming five years. 
There should be a cluster approach and the government should come up with a
National Aerospace and Defence Policy to take on the challenges. 

The idea of capturing business on the back of offsets is a mirage, said Dynamic Technologies Senior Manager Air Cdr K N Kumar. “MSMEs working on this front should think of quality, delivery, and costs. Once this is systematically practised, projects from OEMs will come systematically,” he said. 
Finishing centre on cards
The Karnataka government has decided to set up an Aerospace Common Finishing Centre in Bengaluru. 
The centre will provide surface treatment to aircraft components. Talking to Deccan Herald, Commissioner for Industrial Development and Director of Commerce and Industries Gaurav Gupta said, “The aim is to make industry players more focused in their work and provide MSMEs easy access to OEMs.” 
The project will come up at a four-acre space allotted at the KIADB Aerospace Park near Kempegowda International Airport (KIAL). 

The state also plans to set up an aerospace technology centre, Gupta said.