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Over Rs one lakh crore paid by India for defence acquisition in last five years, says Parrikar


New Delhi (Nov. 25, 2014): India has directly paid over Rs one lakh crore to foreign firms for acquisition of equipment for the armed forces during the last five years, Defence Minister Manohar Parrikar said on Tuesday.

The government, he said, constantly reviews the security scenario and accordingly decides to induct appropriate defence equipment. This is a continuous process undertaken through procurement from various indigenous as well as foreign vendors to keep the armed forces in a state of readiness, he said, adding that procurement from indigenous vendors accounts for a significant share in capital acquisition.

"The total expenditure on direct payments to foreign vendors for capital acquisitions for the army, navy and air force during the last five years was Rs 103535.52 crore," he said in a written reply to Rajya Sabha. Parrikar said that defence production policy focuses on greater self-reliance in defence production. "Government has also raised the FDI limit in defence production from 26% to 49% and liberalised the licensing regime," he said.

The Defence Procurement Procedure 2013 lays emphasis on providing the desired boost to indigenous defence industry by mandating a higher preference to the 'Buy (Indian)', 'Buy & Make (Indian)' and 'Make' categorisation in capital procurement, the Minister said.

In a separate reply, Parrikar said acquisition of weapons and equipment for defence forces during the last 14 years was carried out as per the defence procurement procedure (DPP), as revised from time to time and as per long term integrated perspective plan (LTIPP), services capital acquisition plan and annual acquisition plan. Capital procurements for defence are currently being progressed as per the current LTIPP (2012-27), he said.