DEFENCE INDUSTRIAL CORRIDORS DESERVE HONEST APPRAISAL

AMIT COWSHISH explains how after more than four years of the government decision, the impact of the DICs on defence production remains hazy

- AMIT COWSHISH

Presenting the annual budget for 2018-19 on February 1, 2018, Late Arun Jaitley, then Finance Minister in the union cabinet, announced that the government planned to develop two defence industrial production corridors in the country. It took many by surprise as the establishment of defence industrial corridors (DIC) was not among the priority items on the Indian defence industry's agenda. Nevertheless, sensing that something good may, after all, come out of it, the move was hailed by the industry which dubbed it as a shot in the arm for promotion of defence manufacturing ecosystem in India.

Following up on the announcement, the government established two DICs connecting several nodes along the length of these corridors. While Uttar Pradesh Defence Industrial Corridor (UPDIC) has six nodes running through Aligarh, Agra, Chitrakoot, Jhansi, Kanpur, and Lucknow, the Tamil Nadu Defence Industrial Corridor (TNDIC) in Southern India connects five nodes of Chennai, Coimbatore, Hosur, Salem and Tiruchirappalli.

These nodes were ostensibly selected, based on high potential for creation of end-to-end ecosystem for aerospace and defence sector development covering design, engineering and manufacturing, with an eye on attracting investment of about ₹10,000 crores in each corridor by 2024-25. More than four years later, the impact of these DICs on defence production remains hazy.