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SIPRI Arms Production Capabilities: India

A study has been released by Stockholm International Peace and Research Institute (SIPRI) in October 2022 named “Arms Production Capabilities in The Indo-Pacific Region-Measuring Self-Reliance,” by Lucie Beraud-Sudreau, Xiao Liang, Siemon T. Wezeman and Ming Sun.

Since the armed forces in the Indo-Pacific region remain dependent on the imports of the Weapon system from foreign suppliers, plus the world’s five largest arms importers were from this region for the period 2016-2020, the study draws an essential means to ascertain and quantify the factors and industry-position of the top 12 importer economies of the region as a case study. All importers in the region maintain a common objective of increasing self-reliance in the development of the defence industrial capabilities, including India.

The study used three indicators to assess the level of self-reliance in arms production, in which India stood at the 4th position in South Asia. The three indicators are as follows:

1. Domestic and licensed production as shares of the total acquisitions of significant arms between 2016 and 2020.

2. The size of domestic arms-producing and military services companies.

3. Capabilities in emerging military technologies, as presented by progress in the research and development of uncrewed surface vehicles (USVs) and uncrewed underwater vehicles (UUVs).

Observing the case study of India, which has built up a substantial arms industry since the 1950s. It has been supported by successive governments, till it followed the current policy of broader ‘Make in India,’ which promotes local production in partnerships with foreign companies. The defence as a priority is evident from the budgetary allocation of 2021 military expenditure, which had been earmarked at 64% of its capital outlay for domestic equipment acquisitions.

Indicator 1: Arms Procurement

Globally India remained the largest importer of the major arms, being ranked the second most importer for the period 2016-2020. As per the study, of India’s total volume of procurement in 2016-20, 84 per cent was of foreign origin.

Moreover, licensed production accounted for 69 per cent of the imports (58 per cent of total acquisitions). As the study suggests, an important objective of licensed production is to gain capabilities to develop local design through technology transfers. However, over the decades, the story has been different. For instance, the technology transfer related to the completed large programme for the Russian Su-30MKI was reportedly seen in India as a ‘mistake’ since no real technology transfer took place.

On the other hand, 16 per cent of total procurement has been accounted for as domestic production. Some prominent instances of domestic design that give India’s nuclear forces a high level of autonomy include the land-attack missiles (some with nuclear warheads) and a class of nuclear-powered ballistic missile submarine, Arihant. However, the study states that the recent decades have witnessed a slow and not very successful pace in other categories of major arms such as the development related to the Tejas combat aircraft and some similar progress of the delayed Arjun tank. Thus, it becomes clear that domestic designs remain dependent on imported key components such as engines and radars.

Despite the looming uncertainty of whether India will be able to significantly reduce its dependence on imports in the short or medium term, the country has put forth ambitious programmes for additional nuclear-powered submarines, new combat aircraft designs, autonomous weapons (e.g. a loyal wingman UCAV and autonomous reconnaissance vehicles) and associated components.

Indicator 2: The Arms Industry

India’s arms-producing industry has long been dominated by Public Sector Undertakings and Indian Ordinance Factories under the Ministry of Defence (MOD). Among the largest five state-owned companies for arms production in India, four are the leading producers in aerospace, land systems, electronics and shipbuilding. Moreover, the fifth biggest company, Cochin Shipyard has produced India’s first indigenous aircraft carrier, Vikrant.

There has been a major concern about industrial productivity, their reliance on domestic military orders and their dependence on foreign equipment, given the size and industry dominance. However, the Indian defence industry has begun to diversify its business into the civil market and has set up export offices overseas. Moreover, under the Make in India policy the government has opened an avenue to the private sector, with over 200 companies licensed to produce military items and bid for government projects, often collaborating with major foreign arms producers.

Indicator 3: Uncrewed Maritime Vehicles

In 2019, India established the high-level Defence AI Council (DAIC) and the Defence AI Project Agency (DAIPA) to support the implementation of artificial intelligence projects with military applications. The study believes that ‘the Indian Nava Indigenisation Plan 2015-30 acknowledges UUVs as a critical capability for future warfare and the country’s need to import remotely operated vehicles and AUVs for the shipbuilding programme.’

As per the study, the Defence Research and Development Organisation (DRDO) and the central Mechanical Engineering Research Institute (CMERI) have been considering the development of AUV prototypes. On the other hand, the private sector company Larsen and Turbo has been developing AUV prototypes on its own and in collaboration with foreign partners, such as Italy’s EdgeLab.

[Compilation by Harshita Singh Panwar]

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