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New Delhi, <keyword id="3658" type="General" weightage="20" keywordseo="India" source="Orion">India</keyword> on Thursday accorded an initial approval to defence acquisition projects worth Rs 2.23 lakh crore that included procurement of 97 <keyword id="6376012" type="General" weightage="20" keywordseo="Tejas" source="Orion">Tejas</keyword> light combat aircraft and 156 Prachand combat helicopters, in a major move to significantly enhance the combat capabilities of the armed forces. The Defence Acquisition Council (DAC), chaired by Defence Minister Rajnath Singh, cleared the projects, at a time India is locked in a bitter military standoff with China at a number of friction points in eastern Ladakh for over three years. The defence ministry said 98 per cent of the total procurement worth Rs 2.23 lakh crore will be sourced from the domestic industries and that the move will give a substantial boost to the Indian defence industry in achieving the goal of 'Aatmanirbharta' (self-reliance) in defence industry. The DAC also approved a proposal of the Indian Air Force to upgrade its Su-30 fighter fleet by state-run aerospace major Hindustan Aeronautics Ltd (<keyword id="68124" type="General" weightage="20" keywordseo="HAL" source="Orion">HAL</keyword>). The DAC further accorded Acceptance of Necessity (AoN) or initial approval for procurement of two types of anti-tank munitions namely area denial munition (ADM) type-2 and type-3. The top body on procurement of military hardware also cleared acquisition and integration of automatic target tracker (ATT) and digital basaltic computer (DBC) for T-90 tanks besides approving another proposal to buy medium range anti-ship missiles (MRAShM) for the Indian Navy. The MRAShM is a lightweight surface-to-surface missile which will be a primary offensive weapon onboard various Indian naval ships. "The DAC accorded AoNs for procurement of Light Combat Helicopter for Indian Air Force and Indian Army and Light Combat Aircraft (LCA) Mk-1A for IAF from Hindustan Aeronautics Limited (HAL) under Buy (Indian-IDDM) category," the ministry said. Though it did not mention the specific numbers, official sources said 97 Tejas Light Combat Aircraft (Mark 1A) are being procured for the IAF and 156 Light Combat Helicopters (LCH) are being procured for the Army and the Air Force. In February 2021, the defence ministry sealed a Rs 48,000 crore deal with the Hindustan Aeronautics Ltd for procurement of 83 Tejas MK-1A jets for the IAF. With the additional fleet, the number of indigenously-developed Tejas aircraft being procured by the IAF would go up to 180. "The AoNs have also been accorded by the DAC for upgradation of Su-30 MKI aircraft indigenously from HAL. "While procurement of these equipment will provide enormous strength to the IAF, acquisition from domestic defence industries will take the indigenous capability to a new height," the ministry said in a statement. "It will also reduce dependability on foreign Original Equipment Manufacturers (OEMs) substantially," it added.

India approves defence acquisition projects worth Rs 2.23 lakh cr

<ul><li>The Cabinet Committee on Security (CCS) has reportedly approved the <keyword id="6376012" type="General" weightage="100" keywordseo="tejas" source="Orion">Tejas</keyword> Mark-2 project. </li><li>The CCS has approved ₹6,500 crore for prototypes, flight testing and certification. </li><li>The production of the Tejas Mark-2 is expected to begin around 2030. </li></ul>The Narendra Modi-led Cabinet Committee on Security (CCS) has reportedly approved the Tejas Mark-2 project to boost India’s push for indigenous fighter aircraft. According to a <a href="https://timesofindia.indiatimes.com/india/cabinet-committee-on-security-approves-tejas-2-0-mega-project/articleshow/93914219.cms">report</a> by The Times of India, the CCS on Wednesday approved the Tejas Mark-2 project at a cost of over ₹6,500 crore. The government had already sanctioned ₹2,500 crore for the project. The ₹6,500 crore will reportedly be used for prototypes, flight testing and certification. Tejas is an indigenously developed light multi-role fighter aircraft developed by the Aeronautical Development Agency (ADA) and Hindustan Aeronautics Limited (HAL). India has already ordered 40 Tejas Mark-1 aircrafts, 10 Mark-1 trainers and 73 Tejas Mark-1A aircrafts. While the Tejas Mark-1 is a lightweight aircraft, the Tejas Mark-2 will be a medium-weight aircraft and has been designed to be used for offensive operations in enemy territories. “Lightweight Tejas Mark-1 is primarily meant for air defence. Medium-weight Mark-2 fighter, with its heavy standoff weapons, will be for offensive operations into enemy territory. Its critical design review is complete,” a source familiar with the matter told The Times of India. The Tejas Mark-1, which weighs around 13.5 tonnes, was designed to replace the MiG-21s, and the Tejas Mark-2, which is expected to weigh around 17.5 tonnes, is expected to replace the Mirage and the Mig-29 The Tejas Mark-2’s first flight test will reportedly be conducted in the next two to three years and the production is expected to begin around 2030. In addition to the Tejas Mark-2, the government is also planning on approving the fifth-generation advanced medium combat aircraft (AMCA) with stealth features and supercruise capabilities. The CCS is expected to approve ₹15,000 crore for the AMCA project. The Tejas Mark-2 will be equipped with the GE-414 engines in the 98 Kilonewton thrust class and offer a longer combat range and an increased weapon carrying capacity compared to the Tejas Mark-1. The Tejas Mark-2 will be an important part of the country’s armed forces. “Fly-by-wire, avionics, composites and other technologies have already been proven in Tejas Mark-1. The new project will upscale those into bigger and more powerful fighters. IAF is likely to induct at least six squadrons (110-120) of Tejas Mark-2,” the source added. SEE ALSO: <a href="https://www.businessinsider.in/india/news/indias-tejas-fighter-aircraft-may-soon-make-its-international-debut-check-out-the-features/slidelist/93429613.cms">India’s Tejas fighter aircraft may soon make its international debut – check out the features</a> <a href="https://www.businessinsider.in/stock-market/news/why-tejas-fighter-aircraft-maker-hal-share-price-up-in-2022/articleshow/93426056.cms">This defence sector stock boosted investor wealth by 75%</a> <a href="https://www.businessinsider.in/international/news/india-is-updating-its-air-force-for-a-modern-war-and-china-isnt-its-only-concern/articleshow/85853446.cms">India is updating its air force for a modern war, and China isn't its only concern</a>

Tejas Mark-2 project reportedly approved by the Cabinet Committee on Security

<ul><li>The Indian government has pushed through a stack of defence projects to the tune of $1.2 billion on August</li><li>This comes after the Defence Acquisition Council (DAC) had already approved arms projects worth $5.5 billion last month. </li><li>The biggest beneficiary, <keyword id="86569" type="COMPANY" weightage="20" keywordseo="Hindustan-Aeronautics-Limited">Hindustan Aeronautics Limited</keyword> (HAL), saw its share price jump by over 4% as markets opening today morning. </li><li>The entire $1.2 billion will be spent on the domestic industry with companies like Hindustan Aeronautics Limited (HAL) and <keyword id="534703" type="COMPANY" weightage="20" keywordseo="Bharat-Heavy-Electricals-Limited">Bharat Heavy Electricals Limited</keyword> (BHEL) reaping the benefits.</li></ul>India is spending another ₹8.7 lakh crore ($1.2 billion) on defence projects after having already having approved ₹38.9 lakh crore ($5.5 billion) for arms projects last month. <div type="Article" hostid="261" msid="77098939" title="New drones, Rafale fighter jets, tanks and much more — India-China border dispute has lit a fire to upgrade military technology" mstype="2" mssubtype="0"></div> Last time around the lion’s share of the capital— around ₹31.1 lakh crore ($4.44 billion) — was directed towards the domestic industry. This time the entire amount is going to local manufacturers like Hindustan Aeronautics Limited (HAL) and Bharat Heavy Electricals Limited (BHEL). HAL's share price saw a jump over 4% as markets opened today morning. <div type="image" title="HAL share price" msid="77497628" hostid="261" caption="&amp;lt;p&amp;gt;HAL&amp;#39;s share price since July&amp;lt;/p&amp;gt;"></div> BHEL's share price on the other hand remained muted showing a marginal uptake of over 1%. <div type="image" title="BHEL share price since July" msid="77497651" hostid="261" caption="&amp;lt;p&amp;gt;BHEL share price since July&amp;lt;/p&amp;gt;"></div> The projects approved by the Defence Acquisition Council (<a href="https://pib.gov.in/PressReleseDetail.aspx?PRID=1645092">DAC</a>) in its meeting today headed by India’s Defence Minister Rajnath Singh include new aircraft, more firepower for the <keyword id="6355100" type="ORGANIZATION" weightage="20" keywordseo="Indian-Navy">Indian Navy</keyword>, as well as approvals that will speed the procurement and upgrades of unmanned aerial vehicles (UAVs). The <keyword id="15141" type="ORGANIZATION" weightage="20" keywordseo="Indian-Air-Force">Indian Air Force</keyword> (IAF) needs more eyes in the sky In July, the DAC approved the proposal to procure 21 new MiG-29 aircraft along with upgrading the existing 59 already enlisted with the Air Force. It also sanctioned buying 12 new Sukhoi-20 MK I aircraft. Pushing on the narrative of Athmanibhar Bharat, self-reliant India, the government has put an order for 106 of the newly developed Basic Trainer Aircraft from HAL. Initially, 70 of these jets will be inducted to meet the IAF’s training requirements once they receive the required certification. The remaining 36 will be picked up once the HTT-40 fleet — another trainer aircraft that HAL invested ₹550 crore to develop — is operational. Increasing the Indian Navy’s firepower Other than, the primary beneficiary of the DAC’s project approval is BHEL. The government has approved the procurement of an upgraded version of the Super Rapid Gun Mount (SRGM). It is the main fun onboard Navy and Indian Coast Guard warships. According to the government, the upgraded version of the SRGM will increase the capabilities of the warships to manoeuvre against fast-moving targets like missiles. It will also enhance the engagement range of the guns. The <keyword id="6354416" type="ORGANIZATION" weightage="20" keywordseo="Indian-Army">Indian Army</keyword> won’t be left out of the fray. It will be getting new 125 mm Armour Piercing Fin Stabilised Discarding Sabot (APFSDS) ammunition. 70% of the product will be made in India and the ammunition will be brought in under a ‘design and development case’. Other approvals are aimed at speeding up the procurement of Indo-Russian AK 203 guns and push through faster upgrades for UAVs. SEE ALSO: <a href="https://www.businessinsider.in/defense/news/tcs-tech-mahindra-hcl-tech-and-wipro-could-gain-from/articleshow/77478306.cms">India's armed forces are potential clients for TCS, Tech Mahindra, HCL Tech and the likes</a> <a href="https://www.businessinsider.in/defense/news/heres-a-full-list-of-weapons-that-indias-defence-sector-can-get-from-local-companies/slidelist/77459796.cms">List of weapons that India can make at home — and the ones it cannot</a> <a href="https://www.businessinsider.in/defense/news/indias-defence-ministry-introduces-import-embargo-on-101-items-to-boost-atmanirbhar-bharat-abhiyan/articleshow/77442031.cms">India’s Defence Ministry introduces “import embargo” on 101 items to boost Atmanirbhar Bharat Abhiyan</a>

HAL's share price jumps 4% after India approves defence projects worth $1.2 billion

<ul><li>The DefExpo kicks off tomorrow and it will be teaming with 1,000 companies from 40 countries around the world. </li><li>It will be an opportunity for domestic firms to find international partners to boost their technological capabilities. </li><li>According to Sameer Patil, an international security expert with GatewayHouse, India’s Armed Forces prefer to import equipment because domestic products either don’t meet their requirement or are of inferior quality. </li></ul>As <keyword id="8154465" type="UNKNOWN" weightage="20" keywordseo="DefExpo-2020">DefExpo 2020</keyword> is all set to kick off tomorrow, the many foreign players who will arrive for it, will bank on Indian love for imported equipment. Despite the push for ‘Make in India’, <keyword id="112134" type="ORGANIZATION" weightage="20" keywordseo="Indian-Armed-Forces">Indian Armed Forces</keyword> prefer to purchase high-quality products from global majors. “The DefExpo 2020 would provide a unique platform for defence industry OEMs, exhibitors and private industry to display their latest innovations and capabilities,” said defence minister <a href="https://twitter.com/rajnathsingh">Rajnath Singh</a>. According to him, over 1,000 companies from 40 different countries are scheduled to be present at the five-day event. However, the theme of the event is ‘Digital Transformation of Defence’ — an area where domestic firms don’t excel. “We have defence industrial capacity but our defence industrial capacity is not geared towards high-tech items but low-tech items, which doesn’t require complex expertise,” Sameer Patil, an international security expert with Mumbai-based think tank Gateway House told Business Insider India. An opportunity for foreign players to bag big deals India’s short-term requirements are mostly off-the-shelf items that foreign defence firms are already producing. The Armed Forces don’t favour picking up these items at home because homegrown products normally don’t live up to the hype. “The armed forces are saying that they would prefer imports rather than rely on the Defence Research and Development Organisation (DRDO) to develop the equipment because sometimes it's of inferior quality and sometimes it doesn’t meet the requirements of the Armed Forces,” explained Patil. For instance, the Navy rejected the Naval Light Combat Aircraft — or Tejas — developed by the DRDO and Hindustan Aeronautics Limited (HAL) because it was ‘overweight’. It’s size made it difficult to operate the aircraft from a carrier. However, the Tejas took nearly four decades to make in India. Regardless of the rejection, HAL is pursuing the project. The government’s military equipment manufacturing arm also saw tough times when the Dhruv helicopter crash instigated return-and-refund requests from Ecuador and the Maldives. The Navy also wanted an upgrade over the Dhruv helicopter. It applied to buy new naval utility helicopters with foldable rotor blades. However, HAL <a href="https://www.defencenews.in/article/MoD-expert-rejects-foreign-helicopter,-HAL-says-Dhruv-is-suitable-808920">argued</a> that its own design was robust enough and that it could develop foldable blades on its own over the next two to three years. An opportunity for domestic firms to tie up with foreign players When HAL first partnered with United Aircraft Corporation to manufacture the Sukhoi Su-57, the government expected a transfer of technology. “But because there was no planning or management culture in defence at that time, no one bothered to absorb those technical skills,” explained Patil. However, history is trying to correct itself. Tata, for example, already has a tie-up with Lockheed Martin to build F-16 wings and the F-21 fighter jet. Bharat Electronics Limited (BEL) and Larsen &amp; Toubro (L&amp;T) have also signed a pact to develop and manufacture defence products. “Because the private sector is more efficient, there is an expectation that they will absorb those tech skills. Given a chance, they can come up with indigenous equipment,” said Patil. However, defence indigenisation doesn’t happen overnight. According to Patil, it takes at least two decades to get the ball rolling and see visible results. Its realisation will mean catering to India’s medium and long term requirements for weaponry that isn’t available off the shelf — like robotic technologies. See also: <a href="https://www.businessinsider.in/news/defexpo-2020-will-have-france-russia-south-korea-israel-us-and-african-countries-wooing-indias-defence-sector-for-partnerships/articleshow/73903166.cms">DefExpo 2020 will have France, Russia, South Korea, Israel, US, and African countries wooing India’s defence sector for partnerships</a> <a href="https://www.businessinsider.in/defense/news/india-will-be-picking-up-ai-enabled-military-tech-from-south-korea-at-the-defexpo-2020/articleshow/73933364.cms">India will be picking up AI-enabled military tech from South Korea at the DefExpo 2020</a>

DefExpo 2020 will be an opportunity for domestic defence companies to prove their might to woo foreign firms

<ul><li>At 7:45 am, the SGX Nifty was down 0.18%, indicating a tepid start for Nifty50.</li><li>Here’s a list of stocks to watch for in trade today. </li><li><a href="https://www.businessinsider.in/">Check out the latest news and updates on Business Insider.</a> </li></ul>Indian stock-market indices are likely to start subdued on Friday, led by mixed cues from the global markets. At 7:45 am, the SGX Nifty was down 0.18%, indicating a tepid start for Nifty50. However, the <a href="https://www.businessinsider.in/stock-market/news/us-stocks-climb-as-900-billion-stimulus-deal-appears-imminent/articleshow/79782556.cms">US stocks gained on Thursday</a> and marched toward record highs as a $900 billion fiscal stimulus bill to hasten the economic recovery from the COVID-19 pandemic appeared imminent. The Dow Jones Industrial Average closed 0.49% higher, and the S&amp;P 500 was up 0.58%. These are the stocks to watch out for during the trading session today: RIL The Supreme Court has asked Reliance Industries (RIL) to deposit ₹250 crore, which is 50% of the disgorged amount of ₹447.27 crore, as per the orders of the Securities Appellate Tribunal in a case related to the sale of Reliance Petroleum (RPL) shares. Bharat Dynamics, Hindustan Aeronautics, Bharat Forge and other defence stocks Bharat Dynamics, Hindustan Aeronautics, Bharat Forge and other defence stocks will be in focus during the trade today. The defence acquisition council headed by Union Minister Rajnath Singh approved the capital acquisition of various weapons/platforms/equipment/systems required by the Army, the Navy and the Air Force at an approximate overall cost of ₹28,000 crore. HCL Tech, Infosys, TCS and other IT stocks HCL Tech, Infosys, TCS and other IT stocks will be in focus during the trade. The consulting and outsourcing services provider Accenture has raised its full-year sales forecast and beat quarterly revenue estimates on December 17. Tata Consultancy Services’ (TCS) The ₹16,000 crore share buyback programme of Information technology (IT) major Tata Consultancy Services’ (TCS) will open today (December 18). And, the offer will remain open till January 1. Zee Entertainment The board of Zee Entertainment Entertainment (ZEEL) has approved the acquisition of film production and distribution business from Zee Studios, a wholly-owned subsidiary of the former for a cash consideration of ₹275 crore. BPCL Privatisation-bound Bharat Petroleum Corporation (BPCL) board has approved buying out Oman Oil Company’s stake in the Bina refinery project in Madhya Pradesh on mutually agreeable terms. The BPCL board at its meeting on Thursday also approved merging Bharat Gas Resources (BGRL) with itself, the company said in a filing to the stock exchanges. Godrej Agrovet The Government of Telangana has allotted an area measuring up to 28,164 hectares in the Mahabubabad District of Telangana to Godrej Agrovet, for the purpose of oil palm cultivation. Canara Bank The Life Insurance Corporation of India has acquired 6.28 crore shares of Canara Bank through the qualified institutional placement, taking its total shareholding in the bank to 8.35% from 4.53%. Dishman Carbogen Dishman Carbogen promoter will sell a 4.4% stake in the company via offer for sale on December 18 and 21 at a set floor price of ₹145.70 per share. SpiceJet SpiceJet would start 30 new domestic flights in a phased manner from next week. Among the 30 flights from Sunday, six will connect Darbhanga in Bihar with Ahmedabad, Pune and Hyderabad, the airline said. PVR The board of cinema hall giant PVR will meet today to discuss its fundraising plans. SEE ALSO: <a href="https://www.businessinsider.in/stock-market/news/burger-king-ipo-investors-tripled-their-money-in-three-days/articleshow/79761366.cms" data-type="tilCustomLink">Burger King's IPO investors tripled their money in three days</a> <a href="https://www.businessinsider.in/business/news/india-has-a-hot-new-debate-on-its-plate-should-the-likes-of-burger-king-kfc-and-mcdonalds-menus-mention-calories/articleshow/79771040.cms" data-type="tilCustomLink">India has a hot new debate on its plate: Should the likes of Burger King, KFC and McDonald’s menus mention calories?</a>

Top stocks to watch — RIL, TCS, HCL Tech, Zee Entertainment, BPCL, Bharat Dynamics, HAL, Bharat Forge, and others

<ul><li><keyword id="2257489" type="PERSON" weightage="20" keywordseo="PM-Narendra-Modi">PM Narendra Modi</keyword> while addressing the NCC Rally at Cariappa Ground in Delhi today said India would soon be known as a producer of defence equipment.</li><li>India is the second largest importer of defence equipment and the government has been keen on cutting back.</li><li>Speaking to Business Insider, experts said that India’s efforts have been slow but steady, and the private sector must not try to replicate existing technologies but work on stuff that will be relevant in the future.</li></ul>India’s prime minister <keyword id="6354477" type="PERSON" weightage="20" keywordseo="Narendra-Modi">Narendra Modi</keyword> may have signalled a significant allocation for the defence equipment manufacturing, three days before the big annual <keyword id="6358021" type="ORGANIZATION" weightage="20" keywordseo="budget">budget</keyword> for the next financial year. While addressing a rally of the <a href="https://twitter.com/narendramodi/status/1354689423422578688?s=20">National Cadet Corps (NCC) at Cariappa Ground</a> in New Delhi today, Modi said, “India would soon be known as a producer of defence equipment, instead of being a market as it is today.” It is one of the expectations from the budget to be presented by Finance Minister Nirmala Sitharaman on February 1. While the actual expenditure on defence has nearly doubled, its share of gross domestic product (GDP) has remained largely unchanged. But with tensions flaring along the India-China border and the ambitious revenue target of ₹1,750 billion in the Draft Defence Production &amp; Export Promotion Policy (DPEPP-2020), it is likely to be better this time. <div type="image" title="The defence budget has increased 1.9 times in the last five years" msid="80510999" hostid="261"></div> The intent of the draft is to become self-reliant with a clear focus on doubling the share of procurement from the domestic industry to ₹1,400 billion by FY25 with a clear focus on doubling the share of procurement from the domestic industry. In the last couple of years, India’s export of defence equipment has doubled to ₹100 billion. And, the government also has ambitious plans to increase defence exports to ₹350 billion by FY25, which assures that something is definitely on the cards. Experts say, the government’s efforts to boost domestic manufacturing of defence equipment by private companies has two problems: <ol><li>While some progress has been made by companies like Mazagon Dock Shipbuilders, HAL and Larsen and Toubro, most such projects have been marred by delays.</li><li>As Lieutenant General PJS Pannu, the former deputy chief of Integrated Defence Staff, explained on Business Insider, there is a lack of innovation and that private players should not try to replicate existing technologies and instead innovate alongside the advanced military powers of the world.</li></ol>While India attempts to become self reliant in defence, it remains the second-largest defence equipment importer in the world. <div type="image" title="India defense exports" msid="80511105" hostid="261"></div> Sameer Patil, a security analyst at Gateway House India in an exclusive conversation with Business Insider, said, “ I think in the last 10 years based on India’s modernized military modernization, we have made a decent effort, at least in terms of making sure that much of these position actually happens through domestic production tear involving the at least the defence, public sector units, and to some extent the private sector units.” <table style="border-width: initial; border-style: none;"></colgroup><tbody><tr><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Name of the equipment </td><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Maker </td></tr><tr><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;"> Scorpène class submarine </td><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Mazagon Dock Shipbuilders </td></tr><tr><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;"> K9 missile </td><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">L&amp;T </td></tr></tbody></table> <div type="twitter" handle="BiIndia" handlename="Business Insider India🇮🇳" image="http://pbs.twimg.com/profile_images/1232926719016718336/sfffJHNV_normal.jpg" favoritecount="7" retweetcount="0" status="#BudgetInsider | @Iyer_Sriram in conversation with @GatewayHouseIND's @sameerpatilIND and Lt General PJS Pannu on w… https://t.co/PIe7wFGeP2" createdat="1611751284000" id="1354409169382608896"></div> Domestic defence manufacturing has a huge potential India’s defence manufacturing industry is estimated to be worth $800 billion, with the public sector accounting for the lion’s share. This year, with the implementation of Atma Nirbhar Bharat proposals and increasing border tensions, defence upgradation is likely to be prioritised, and the private sector may get a bigger piece of the pie, especially at home. And, by creating <a href="https://www.businessinsider.in/defense/news/india-likely-to-introduce-a-second-defence-import-embargo-list-by-the-end-of-year-as-it-chases-down-5-billion-in-exports/articleshow/77797223.cms">a list</a> of arms and ammunition that can’t be imported, the government has become local companies an opportunity to chip and fill the void. The <a href="https://www.businessinsider.in/defense/news/india-increases-fdi-limit-in-defence-manufacturing-and-will-ban-certain-import/articleshow/75775865.cms">foreign direct investment</a> (FDI) limit in the defence sector has also been increased from 49% to 74% under the automatic route. Lieutenant general PJS Pannu told Business Insider that India should catch up with other countries rather than investing and working on the old ideas. Are you going to produce what the others have produced a few years back, or what you’re going to innovate is something ahead of time which others don’t have? You can keep going on a loop where if somebody was making an investment about 20 years back and now from there you’re getting an idea, and you’re saying OK. If something was produced about 20 years back now let me catch up and start making the same product, he said. SEE ALSO: <a href="https://www.businessinsider.in/business/startups/news/indian-grooming-startup-bombay-shaving-company-gets-45-crore-investment-from-dettol-maker-reckitt-benckiser/articleshow/80491558.cms">Indian grooming startup Bombay Shaving Company gets ₹45 crore investment from Dettol maker Reckitt Benckiser</a> <a href="https://www.businessinsider.in/tech/news/apple-demolished-q1-earnings-estimates-and-set-a-new-record-with-111-billion-in-revenue/articleshow/80490065.cms">Apple demolished Q1 earnings estimates and set a new record with $111 billion in revenue</a>

India’s Prime Minister Narendra Modi may just have signalled a big allocation for defence equipment manufacturing, 3 days before the budget

<ul><li>The <keyword id="152819" type="ORGANIZATION" weightage="20" keywordseo="Defence-Research-and-Development-Organisation">Defence Research and Development Organisation</keyword> (<keyword id="6355142" type="DEFINITION" weightage="20" keywordseo="DRDO">DRDO</keyword>) will no longer require ‘performance security’ for any new development contracts. </li><li>The move will further remove the red tape between the industry and the government and hopefully incentivise participation, according to the Ministry of Defence (MoD).</li><li>However, a Performance cum Warranty Bond will still be required from successful development partners to cover DRDO’s interest during the warranty period.</li></ul>India’s Defence Minister <keyword id="6355121" type="UNKNOWN" weightage="20" keywordseo="Rajnath-Singh">Rajnath Singh</keyword> approved Defence Research and Development Organisation (DRDO) waiving the requirement of ‘performance security’ for development contracts under its helm as a move to incentivise the private sector’s participation. The same will also be true for the Indian Navy’s Advanced Vessel Project (<a href="https://economictimes.indiatimes.com/news/defence/russia-offers-to-jointly-design-build-submarines/articleshow/64877908.cms?from=mdr">ATVP</a>) to design and construct a submarine with Russia. The new submarines will be customised to Indian systems, including the Brahmos missile. “This provision will be applicable to all RFPs (requests for procurement) issues in respect of develo contracts after the date of issue of this amendment that is 23 September 2020,” said the Ministry of Defence (<a href="https://pib.gov.in/PressReleasePage.aspx?PRID=1658680">MoD</a>) in a statement. All existing development contracts, where the RFP has already been issued, will continue to be regulated as per the provisions outlined in the contract. What is performance security? Performance security is one of the requirements for obtaining a Letter of Credit (LC) from the bank — an undertaking given by it on behalf of the buyer to pay the seller. It is one of the banking instruments to facilitate foreign payments, according to the DRDO’s <a href="https://www.drdo.gov.in/sites/default/files/procurement-manuals-document/procurement-manual-2016.pdf">procurement manual.</a> What is a development contract? "Developmental contract is concluded for the development of an item as per given design and specifications by DRDO for producing a specified quantity by the selected development partner," outlines DRDO's manual. These contracts may subsequently lead to production contracts with unit production cost worked out based on successful completion of the contract. Should that be the case, DRDO will then require a Performance cum Warranty Bond. In issuing this, the seller is promising performance of the contract till the warranty period. It usually pegged at 5% to 10% of the total contract value. For Indian partners, the Performance cum Warranty Bond may be accepted in the form of a bank draft, fixed deposit receipt, banker’s cheque or a bank guarantee. For foreign bidders, it may be accepted in the form of a bank guarantee or 'stand-by' LC. Chairman DRDO Satheesh Reddy stated that it is another important milestone to support Industry. SEE ALSO: <a href="https://www.businessinsider.in/defense/news/latest-updates-on-india-china-border-issue/articleshow/78162853.cms">Over 20 HAL choppers are ready for winter along the India-China border, but the Indian Army is facing a carbine shortage</a> <a href="https://www.businessinsider.in/defense/news/china-has-hardened-its-stance-experts-decode-the-india-china-joint-statement-on-border-tensions/articleshow/78270081.cms">China has hardened its stance — experts decode the India-China joint statement on border tensions</a> <a href="https://www.businessinsider.in/defense/news/china-is-reportedly-expanding-and-upgrading-a-large-number-of-military-facilities-along-the-border-with-india/articleshow/78258521.cms">China is reportedly expanding and upgrading a large number of military facilities along the border with India</a>

DRDO waives 'performance security' for development contracts as an incentive for the private sector

<keyword id="32723" type="COMPANY" weightage="20" keywordseo="Defence">Defence</keyword> Minister Rajnath Singh on Thursday projected that the annual Indian defence exports will touch Rs 35,000 crore by 2024 from the current level of Rs 17,000 crore. Singh also said he has no doubt about India emerging as among the three major economies of the world by 2030 andthe defence industries will have an important role to play. "India's defence export is growing. In the last two years our export has been Rs 17,000 crore but keeping in view your (Hindustan Aeronautics Limited) capacity in the successive years, I can say that by 2024 Rs 35,000 crore. I am confident about it," the Defence minister said at the Karnataka 'Rajyotsava' event organised at the HAL here. The minister told the gathering that India cannotremain dependent on imports for long and the Indian companies,especially defence public sector units, will have to play amajor pro-active role in achieving the goal of 'Make In India'as envisaged by Prime Minister <keyword id="6354477" type="PERSON" weightage="20" keywordseo="Narendra-Modi">Narendra Modi</keyword>. "We don't want to see India as an importing nation. Instead, based on your strength, I can say that India is sure to become an exporting nation. Nobody can stop her," Singh said. In this regard, he hailed the HAL for being among those Defence public sector units, whose performance in operations and finances was excellent. "By March 2019, the company's turnover was Rs 19,705 crore and the HAL gave shareholders 198 per cent healthy dividend," he said. Singh was all praise for Kambala runner <keyword id="2126425" type="PERSON" weightage="20" keywordseo="Srinivas-Gowda">Srinivas Gowda</keyword> who shot into the limelight covering 100 metres in 9.55 seconds at a traditional sporting event held at Aikala near <keyword id="6355140" type="LOCATION" weightage="20" keywordseo="moodbidri">Moodbidri</keyword> in Karnataka recently. Kambala is an annual race where people sprint 142m through paddy fields with buffalo. He said there are many talents hidden in India who need to be brought out and HAL has a role in discovering them and providing them a platform to grow and prosper. The minister also recalled the iconic personalitiesborn in Karnataka right from Hindustani classical singersGangubai Hangal, <keyword id="6384150" type="PERSON" weightage="20" keywordseo="bhimsen-joshi">Bhimsen Joshi</keyword>, 12th century social reformerBasaveshwara and Field Marshal <keyword id="837026" type="PERSON" weightage="20" keywordseo="K-M-Cariappa">K M Cariappa</keyword>. The atmosphere in Karnataka is conducive for science andtechnology, which provided base for HAL to have itsheadquarters here in Bengaluru, he noted. GMS RS BN BN

Indian defence exports will touch Rs 35,000 crore by 2024, says Defence 
 Minister Rajnath Singh

<ul><li><keyword id="6738479" type="UNKNOWN" weightage="20" keywordseo="India-defence-expenditure">India defence expenditure</keyword> is unlikely to change in the coming year. </li><li>Most will go towards salaries and pensions, while the rest will go towards the military, army and naval services. </li><li>Most of 2020’s defence expenditure will go towards acquiring new <keyword id="3089319" type="PERSON" weightage="20" keywordseo="Tejas-MK-1A">Tejas Mk 1A</keyword> aircraft. </li></ul>India’s is modest when it comes to spending on defence. This year’s budget allocation of ₹4.3 lakh crore — 1.6% of the GDP — was the lowest since the 1962 war against China. And, that doesn’t seem to be changing anytime soon. "Allocation to remain static, selection is key," said ICICI Securities report on expectations for 2020. Nearly 71% of the budget went towards defence services and 26% towards pensions — leaving only 3% for the Ministry of Defence’s civil operations. Even in that, more than half goes towards salaries and pensions. While some may argue that India’s reserved defence spending leaves more money for development, it also leaves little room for modernisation. More weapons, more power Out of the total allocation of the defence budget, nearly one-third went towards acquiring new weapons. "The headline capital expenditure growth of 10% is the highest since FY13 and not due to some restructuring of heads as was the case in FY17, but genuine addition of allocation across Army, Navy and Air Force," said the report. While this meant that some quick money was spent, not a lot was done in terms of modernisation. Most of next year’s budget to be eaten up by Tejas Mk 1As The outlook for the coming year points to not much change in the future. Most of next year’s budget will go towards acquiring the Tejas Mk 1A — India’s homegrown fighter jet. "There is no decision of Tejas Mk 1A orders yet, an acquisition which we expect will complete in CY20. This can consume a significant chunk of the CY20 budget allocation," said the ICICI Securities report. The Tejas Mk 1A spent four decades in the making to match the capabilities of the MiG-21 aircraft — and yet, it falls short in comparison to other leading fighter jets around the world. The manufacturer, Hindustan Aeronautics Limited (HAL) — which was responsible for making the Tejas Mk I aircraft — has only been able to deliver 8 aircraft a year. In comparison, bigger manufacturers are able to deliver 16 to 17 in a year. Moreover, India has plans to order 83 Tejas Mk1A jets in the coming year. "We also expect steady allocation towards naval platforms and perhaps CY20 capital allocation will reflect the same," said the report. No room for modernisation The Indian Army is currently struggling to upgrade its equipment because of the resource crunch. In addition to being cautious about bringing new projects on board, it’s also grappling to pay for past contracts. Against a requirement of ₹1.1 lakh crore for committed liabilities, the budget allocation fell short by ₹67,363 crore — nearly half the requirement, according to the Institute for Defence Studies and Analyses (<a href="https://idsa.in/issuebrief/indias-defence-budget-2019-20-lkbehera-080719#footnote1_efqm4yp">IDSA</a>). Acquiring new equipment is only one of the problems — the other is being sustainable. Investment towards research and development has been increasing 8% annually, according to ICICI Securities. But it still remains a very small proportion of the total defence budget. In 2019, only ₹19,021 crores — 4.4% of the budget — was allocated to the Defence Research Development Organisation (DRDO). See also: <a href="https://www.businessinsider.in/defence-budget-2019-20indias-defence-budget-has-nearly-doubled-in-5-years/articleshow/70037360.cms">India’s defence budget has nearly doubled in 5 years but the money is not enough to upgrade the weapons</a> <a href="https://www.businessinsider.in/science/space/news/isro-risat-2br1-spy-satellite-surveillance-along-borders/articleshow/72454280.cms">ISRO's all-weather ‘spy satellite’ will help India watch its borders closely</a>

India’s ready to spend on defence — just not on modernisation

<ul><li>It is unlikely that the budget allocation to the Armed Forces will increase dramatically this year, according to Sameer Patil, an expert in international security.</li><li>The lion's share of the budget will go towards the Army, leaving the Navy and the Air Force strapped for cash.</li><li>Patil told Business Insider that the Navy and the Air Force are forced to rely on imports since domestic products are usually inferior in quality or do not meet their requirements even though they don't have enough resources to pay for projects that are already underway.</li></ul>Budget allocation for India's Armed Forces always falls short of requirements. Even though the budget increases every year, most of it <a href="https://www.businessinsider.in/why-india-needs-more-defence-budget/articleshow/70082260.cms">goes toward revenue expenditure</a> to pay salaries and pensions. Even within the entire allocation, <a href="https://www.businessinsider.in/defense/news/indian-army-versus-military-spending-on-other-countries/articleshow/73182937.cms">the lion's share goes towards the Army</a> rather than the Navy or the Air Force, which are more technology-intensive. "The government will try and maintain the <a href="https://www.businessinsider.in/defense/news/india-defence-expenditure-in-2020/articleshow/72822974.cms">incremental growth</a> which they do every year but it will not be sufficient to meet the requirements of the armed forces — particularly for the Navy and the Airforce, where they're finding it difficult as it is even to make payments for the equipment that they have already started purchasing," said Sameer Patil, a fellow in international security studies at Gateway House — a think-tank based in Mumbai told Business Insider. 
 
 
 <div type="image" title="af5_edited" msid="73771070" hostid="261" caption="&amp;lt;p&amp;gt;Indian Air Force imported Apache helicopters from the US&amp;lt;/p&amp;gt;"></div>







 The <a href="https://www.businessinsider.in/defense/news/indias-budget-allocation-for-defence-has-remained-fairly-static-for-the-past-five-years/articleshow/73153930.cms">shrinking allocation of resources</a> means that a lot of the proposals that have already been cleared by the defence acquisition council are now being strapped. For instance, the Indian Navy was supposed to get four landing platform dock-type ship built in India. So far, it only has one -- the INS Jalashva, which it bought from the US. At the end of the day, they are left with no option but to import weapons and equipment. The domestic defence industry is either still developing products which are already available off-the-shelf abroad or producing products of inferior quality. The question of research and development It's not that domestic firms don't wish to invest in research and development (R&amp;D) but they lack incentives. Last year, the government allocated some funds to the Technology Development Fund. However, the money is insufficient to cover even a single project, according to Patil. In addition to scarce resources, the Defence Research and Development Organisation (DRDO) discourages private participation. "If the DRDO finds out that the private sector is engaging in any R&amp;D work, they will come and say that we will do the R&amp;D — because we have the experience and the necessary facilities, and we'll give you the final product," explained Patil. The government can't say no Once the DRDO steps in, the government isn't in a position to say no. For example, the Naval Light Combat Aircraft developed by the DRDO and <keyword id="86569" type="COMPANY" weightage="20" keywordseo="Hindustan-Aeronautics-Limited">Hindustan Aeronautics Limited</keyword> (HAL) were rejected by the Navy four years ago. The Navy explained that they did not need the new choppers because they had already purchased Apache and Chinook from the US. Nonetheless, HAL is still pursuing the project. 
 
 
 <div type="image" title="af2_edited" msid="73770980" hostid="261" caption="&amp;lt;p&amp;gt;&amp;lt;sup&amp;gt;&amp;lt;/sup&amp;gt;Two officers and five other IAF personnel were killed when an indigenous Dhruv advanced light helicopter crashed in a field near Sitapur in Uttar Pradesh in 2014&amp;lt;/p&amp;gt;"></div>







 "Which is why the armed forces are saying that they would prefer imports rather than rely on the DRDO. Because sometimes it's of inferior quality and sometimes it doesn't meet the requirements of the armed forces," said Patil. He feels that the private sector is more efficient and currently in the process of absorbing the requisite skills through joint ventures with American aerospace companies — like the Tatas with Lockheed Martin. However, they are not immediately expected to do so. Although defence indigenisation holds a lot of potential, it will take at least a decade or two to show results. 
 
 
 <div type="image" title="af3_edited" msid="73771105" hostid="261" caption="&amp;lt;p&amp;gt;The indigenous Tejas aircraft took 30 years to develop&amp;lt;/p&amp;gt;"></div>







 See also: <a href="https://www.businessinsider.in/defense/news/indian-army-versus-military-spending-on-other-countries/articleshow/73182937.cms">Here's how the budget allocation for Armed Forces in India stacks up on the global scale</a> <a href="https://www.businessinsider.in/defense/news/indias-budget-allocation-for-defence-has-remained-fairly-static-for-the-past-five-years/articleshow/73153930.cms">Budget 2020: Five charts that explain what you can expect from India's defence expenditure this year</a> <a href="https://www.businessinsider.in/defense/news/india-defence-expenditure-in-2020/articleshow/72822974.cms">India's ready to spend on defence — just not on modernisation</a>

The budget is unlikely to give more money for equipment, but the Armed Forces still want expensive imports over domestic products

<ul><li>At 8:00 am, the SGX Nifty was trading 0.07% higher, higher pointing towards a cautious start for Nifty50. </li><li>Here’s a list of stocks to watch for in trade today. </li><li><a href="https://www.businessinsider.in/">Check out the latest news and updates on Business Insider</a>. </li></ul>Indian stock market is likely to open on a tepid note, tracking subdued cues from global markets. At 8:00 am, the SGX Nifty was trading 0.07% higher, pointing towards a cautious start for Nifty50. On Thursday, the US stocks finished lower as the tech shares struggled, weighing on the market. The Dow Jones Industrial Average closed 0.47% lower, and the S&amp;P 500 fell 28.48 points, towards the close. Here’s a list of stocks to watch for in trade on September 18: Dr Reddy's Laboratories Dr Reddy's Laboratories said it had settled litigation with a unit of Bristol Myers Squibb related to patents for Revlimid (lenalidomide) capsules, used to treat various kinds of cancer. "We are pleased with the settlement agreement, and look forward to bringing a generic version of lenalidomide to market soon subject to regulatory approval for the benefit of patients," Dr Reddy's Laboratories North America Generics CEO Marc Kikuchi said. The share price of Dr Reddy's Laboratories closed 4.26% higher yesterday. TVS Motor Company One of India's largest automakers, TVS Motor, has entered into a new distribution partnership in Colombia. The company has tied up with Autotecnica Colombiana SAS (Auteco SAS), a leading motorcycle assembler in Colombia. Autotecnica Colombiana SAS will operate 50 dealerships exclusive for the company and create dedicated space for the brand in over 600 retail outlets, it added. The share price of TVS Motor closed a percent lower on Thursday. Vedanta Vedanta Resources has approached the market regulator SEBI for necessary approvals to start the reverse book building process. The company, earlier in May, announced its plans to delist Vedanta from the Indian stock exchanges by buying out non-promoter shareholding. The share price of Vedanta closed a percent higher on Thursday. IRCTC IRCTC, the company that operates Indian Railways, is planning to levy ‘affordable’ user charges in 700-1,050 stations across the country. It will help build more revenue while providing better facilities and redevelop stations for passengers. The share price of IRCTC closed a percent higher on Thursday. Hindalco and Hindustan Copper Hindalco said that it has entered into a pact with Hindustan Copper for the long-term purchase and sale of copper concentrate produced by the PSU. Under this MoU, around 60% copper content of Hindustan Copper's current concentrate production will be utilised by Hindalco in the manufacture of refined copper. The share price of Hindalco closed 4% lower on Thursday, whereas Hindustan Copper gained 3% during the closing bells. Bharat Forge, Larsen &amp; Toubro, Hindustan Aeronautics Limited, and other defence stocks Defence stocks, including Bharat Forge, Larsen &amp; Toubro, and Hindustan Aeronautics Limited, will be in focus during the trade today since India has permitted foreign direct investment (FDI) of up to 74% under automatic route in the defence sector. The share price of Bharat Forge, Larsen &amp; Toubro, Hindustan Aeronautics, all were trading in red yesterday. Vodafone Idea The telecom giant Vodafone Idea has told the telecom regulator that it is dropping the contentious faster data speed claim as part of priority offering and is in the process of filing a revised plan, according to <a href="https://www.cnbctv18.com/telecom/vodafone-idea-drops-faster-speed-claim-in-priority-offering-informs-trai-about-revised-plan-6939661.htm">media reports.</a> The share price of Vodafone Idea closed 2.17% lower on Thursday. Sterling and Wilson Solar Sterling and Wilson Solar said that the company had won a 106.71 MW solar project in Chile, it's fifth in Latin America, worth $62.6 million (about ₹462 crore). "Sterling and Wilson Solar has signed an order of 106.71 MW worth USD 62.6 million in Chile. The order has been received from a global independent power producer (IPP), work for which is expected to begin in Q4 FY 2021," the company said in a statement. The share price of Sterling and Wilson Solar closed 5% lower yesterday. HDFC Bank A US-based law firm has filed a class-action suit against HDFC Bank, claiming damages for the losses incurred by investors because of "materially false and misleading" representations made by the bank. The share price of HDFC Bank closed a percent lower yesterday. SEE ALSO:<a href="https://www.businessinsider.in/tech/news/instagram-and-facebook-appear-to-be-down-for-some-users-in-north-america-and-europe/articleshow/78176926.cms" data-type="tilCustomLink"> Instagram and Facebook were down for some users in North America and Europe</a> <a href="https://www.businessinsider.in/sports/news/dailyhunt-app-founders-confirm-ipl-2020-associate-sponsorship/articleshow/78169667.cms" data-type="tilCustomLink">EXCLUSIVE: Dailyhunt founders confirm IPL 2020 associate sponsorship — promise new release for Josh ahead of India’s biggest cricket tournament</a>

You Searched For "HAL defence projects" and got 11 results

India approves defence acquisition projects worth Rs 2.23 lakh cr

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Tejas Mark-2 project reportedly approved by the Cabinet Committee on Security

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HAL's share price jumps 4% after India approves defence projects worth $1.2 billion

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Top stocks to watch — RIL, TCS, HCL Tech, Zee Entertainment, BPCL, Bharat Dynamics, HAL, Bharat Forge, and others

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India’s Prime Minister Narendra Modi may just have signalled a big allocation for defence equipment manufacturing, 3 days before the budget

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DRDO waives 'performance security' for development contracts as an incentive for the private sector

Prabhjote Gill

Indian defence exports will touch Rs 35,000 crore by 2024, says Defence Minister Rajnath Singh

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India’s ready to spend on defence — just not on modernisation

Prabhjote Gill

The budget is unlikely to give more money for equipment, but the Armed Forces still want expensive imports over domestic products

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Top stocks to watch— Dr Reddy's Laboratories, HDFC Bank, TVS Motor, Vedanta, IRCTC, L&T, Bharat Forge, HAL, and more

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