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2020-03-24

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Relevant for: Science & Technology | Topic: Defence related developments

Ministry of Defence

Defence export of the country

Posted On: 23 MAR 2020 4:19PM by PIB Delhi

Various reforms/steps have been taken to enhance Defence exports. These reforms have provided a big boost to defence exports in the recent times. The authorisation for defence exports in the country have grown seven folds in the last two years. The steps taken to promote defence exports are as follows:-

  • Special Chemicals, Organisms, Materials, Equipment and Technologies (SCOMET) Category 6 titled “Munitions List” that was hitherto “Reserved” has been populated and Military Stores list notified vide Notification No.115(RE-2013)/2009-2014 dated 13th March, 2015 stands rescinded.
  • The Director General of Foreign Trade (DGFT) vide Public Notice No. 4/2015-20 dated 24th April, 2017, notified Department of Defence Production (DDP) as the Licensing Authority for export items in Category 6 of SCOMET. The export of items specified in Category 6 (Munitions List) except those covered under Notes 2 & 3 of Commodity Identification Note (CIN) of the SCOMET is now governed by the Standard Operating Procedure issued by the Department of Defence Production (DDP), Ministry of Defence.
  • Standard Operating Procedure (SOP) for the export of munitions list items has been modified and placed on the website of the DDP.
  • A completely end-to-end online portal for receiving and processing authorisation permission has been developed. The applications submitted on this portal are digitally signed and the authorisation issued is also digitally signed.
  • In repeat orders of same product to the same entity, consultation process has been done away with and permission is issued immediately. For the repeat order of same product to different entity, the consultation earlier done with all stakeholders is now limited only with MEA.
  • In Intra-Company business (which is especially relevant for outsourcing of work by defence related parent company abroad to its subsidiary in India), the earlier requirement of getting End User Certificate (EUC) from the Government of importing country has been done away with and ‘Buying’ Company is authorized to issue the EUC.
  • The legitimate export of the parts and components of small arms and body armour for civil use are now being permitted after prior consultation with MEA.
  • For export of items for exhibition purposes, the requirement of consultation with stakeholders has been done way with (except for select countries).
  • Powers have been delegated to DRDO, DGOF and CMD’s of DPSUs for exploring export opportunities and participation in global tenders.
  • New End User Certificate Format for Parts & Components has been provided in SOP.
  • Validity of Export Authorization has been increased for 02 years to date of completion of order/component whichever is later.
  • A new provision for re-exporting parts and components for undertaking repair or rework to provide replacement for a component under warranty obligation is inserted in the SOP as a sub-classification of repeat orders.
  • MHA vide Notification dated 1.11.2018 has delegated its powers to this Department to issue export license under Arms Rules 2016 in Form X-A,  for parts & components of small  arms. With this the Department of Defence Production becomes the single point of contact for exporter for export of parts and components of Small Arms & Ammunitions.
  • The Government has notified the Open General Export License (OGEL)  -  a one time export license, which permits the industry to export specified items to specified destinations, enumerated in the OGEL, without seeking export authorisation during the validity of the OGEL.
  • Scheme for Promotion of Defence Exports has been notified to provide an opportunity to the prospective exporters an option to get their product certified by the Govt. and provides access to the testing infrastructure of Ministry of Defence for initial validation of the product and its subsequent field trials. The certificate can be produced by the prospective exporter for marketing their products suitably in the global market.
  • A separate Cell has been formed in the Department of Defence Production to co-ordinate and follow up on export related action including enquiries received from various countries and facilitate private sector and public sector companies for export promotion.
  • A Scheme to provide financial support to Defence Attaches for taking up actions for promoting exports of Indian made defence products both of public and private sector in the countries to which they are attached has been notified.

Based on the value of Authorization/Licence issued by DDP to Private companies and actual export by DPSUs/OFB the export value during the last three years is as under:

 

2016-17

2017-18

 

2018-19

 

Total Export

(in Rs crore)

1521.91

4682.36

10745.77

 

Outsourcing is used as a strategic tool to achieve cost benefits and helps in complementing the strength of private sector to build a strong industrial base. It also helps in meeting the delivery schedules and is therefore done by DPSUs and OFB.

This information was given by Raksha Rajya Mantri Shri Shripad Naik in a written reply to Shrimati Ambika Soni in Rajya Sabha today.

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