The Defence Defence Offset Policy was introduced in 2005 as a "gamechanger for the private sector" and the first offset contract was signed in 2007. At that time the Indian Ministry of Defence was criticised for being a late starter in introducing an offset policy. The idea was that since India was one of the largest defence importers and its defence expenditure was expected to rise further, it can leverage its buying power towards developing its industrial base, which was the norm- in over 130 countries. Some of the countries had an offset threshold level as low as 20 crores and percentage of offsets to be carried out as high as 70 per cent of the equipment procured. However, India went ahead and introduced the offset policy with a threshold level of 300 crores, which was relatively much higher than the global average.
Over the years, a total of 56 offset contracts estimated at $13.03 billion have been signed and are expected to be implemented by the Year 2027. However, in the last couple of years, certain indications were forthcoming that all is not well when discharging offset obligations. According to a March 2020 report of the Parliamentary Standing Committee on Defence, a penalty amounting to $38.19 million had been imposed till then in eleven of the 56 offset contracts signed for the shortfall in achieving the annual targets. Further, In August last year, it was reported by the print media that the MoD had threatened to ban a US company and put another 11 US, French, Russian and Israeli companies on a watchlist on account of slow implementation of the offset contracts.
Toward this end, Insighteon Consulting ran an interactive wargame on February 23 and 24, 2022, with the aim of ascertaining the following the reasons behind the failure to fulfil offset obligations leading to penalties and options available to hasten the process of achieving closure of defence offset obligations.
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Denne historien er fra April 2022-utgaven av Geopolitics.
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NEW MANTRA FOR DISPUTE RESOLUTION
AMIT COWSHISH explains why the Ministry of Defence (MOD), which is one of the biggest spenders, needs to watch out for the latest mediation rules.
NEW WAVE TERRORISM IN JAMMU & KASHMIR
KARAN KHARB argues that Pakistan's continued use of proxy war tactics against India, particularly in Jammu and Kashmir, poses a severe threat to national security. He advocates for a shift from a reactive to a proactive approach in counter-terrorism efforts, emphasizing the need for a comprehensive review of military strategies and a coordinated national policy to address both external and internal security challenges effectively.
INDIAN NAVY'S PROJECT-751 - GERMAN TKMS LEADS SPANISH NAVANTIA AFTER FIELD TRIALS FOR AIP-SUBMARINE DEAL
German submarine-builder ThyssenKrupp (TKMS) and India's Mazagaon Dockyard Limited (MDL) have emerged as leaders in the Indian Navy's Project-751, which aims to build six submarines with Fuel Cell Air-Independent Propulsion (AIP) and Lithium-ion batteries. Following successful field trials, TKMS and MDL have gained an edge over competitors by demonstrating their proven AIP technology and advanced submarine design tailored to the Indian Navy's needs.
VIKSIT BHARAT FROM A DREAM TO REALITY
The article explores India's ascent as a global influencer, emphasising its strategic advancements in foreign policy, defence, and economic growth. It also highlights India's challenges in achieving sustainable development and strengthening internal security. Adopting a forward-looking approach, the article envisions India's rise as a major economic power and a key player in global stability, as outlined by LT. GEN. A.B. SHIVANE (RETD.).
WILL MODI APPLY THE LESSON LEARNT FROM KOREA IN UKRAINE?
Speculation around Prime Minister Narendra Modi's possible visit to Ukraine raises questions about India's role in mediating peace between Russia and Ukraine. Drawing from its experience during the Korean War, India may seek to leverage its strategic neutrality to foster dialogue in a conflict where China and Turkey have also shown interest, opines PRAKASH NANDA.
UGVS: THE NEXT DIMENSION OF WARFARE
With the rest of the world developing unmanned ground vehicles at a breakneck speed, it is time for India to join the bandwagon at the earliest.
SUPERSONIC DESTROYER
The BrahMos programme has filled a critical gap in the Indian armed forces' missile inventory and continues to attract strong export interest, writes ATUL CHANDRA.
POLICE MODERNISATION: AN URGENT NEED OF THE HOUR
India is facing many internal security threats, and it is time to reshape the strategic dynamics by modernising the police forces.
FUTURE FIGHTER
FIA 24 provided important insights into the Global Combat Air Programme, which will redefine the future of air combat, reports MIKE RAJKUMAR.
FILLING THE GAP
A new Medium Transport Aircraft is essential for the IAF, but it will have to compete with other pressing programmes fighting for limited budgetary resources, analyses ATUL CHANDRA.
