Strategic partnership model: Manohar Parrikar ropes in industry for recommendations on defence manufacturirng

The Economic Times



To untangle the logjam over his strategic partnership (SP) model that is being showcased as the anchor of the Make In India initiative in the defence sector, Manohar Parrikar is roping in the industry with the setting up of five consultation groups that will make specific recommendations on manufacturing defence equipment.

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The SP model — selecting key private industry players for specific large scale defence manufacturing projects — has been in the making for over a year but little progress has been made as it has encountered resistance both within the ministry as well as with other stakeholders.

Strategic partnership model: Manohar Parrikar ropes in industry for recommendations on defence manufacturirng
The industry too has been up in arms on the details of the SP model that a defence ministry appointed panel has recommended, specifically on clauses that restrict a particular company from participating in more than one sector - like warship building or aircraft manufacturing.

Now, in an effort to get the industry on board and to accelerate the SP model, the defence ministry has set up five new sub groups - all headed by different industry bodies - that will make specific recommendations for sector like armoured fighting vehicles, aircraft, submarines and ammunition.

In a sign that the SP model is being accelerated, the groups have been given just 10 days to come up with recommendations. "The chairman of each of the give sub groups will have to complete the discussions on the topic assigned to them and be ready with their presentation within ten days of the issuance of the convening order," a defence ministry directive dated May 20 states.

Each of the sub group will have industry representative from CII, FICCI, ASSOCHAM, PHDCCI and FISME. The chairman of the group - from an industry association - will then make a presentation to Parrikar on the discussions and recommendations.

As reported by et , SP model has faced resistance with various departments and services raising concerns that process recommended may lead to monopolization and needs more consultation. The Atre Committee report has identified five priority areas for Make in India in the defence sector.

While the concept of the SP model to identify and encourage private sector players for manufacturing in defence is agreed to, details like the suggestion that only one company be selected for a particular segment like warship production or submarine construction - has not found full favour within the ministry and with the industry.