Foreign Direct investment-Defense Sector-big opportunity- safeguards to be in place
The government of India has recently announced large scale liberalization in the defense sector including up to 100% of foreign ownership under approval route. On the one hand this has given major boost to Indian entrepreneur like Reliance, TATA, Baba Kalyani and thousands of others to plan large scale production units in high tech defense sector. A Large number of International companies including the top five defense manufacturers in the world are very swiftly firming up their plans to make defense equipment in India
In the backdrop of majority and up to 100% foreign ownership, major apprehension on the sovereign, safety and integrity of India are being raised. While we support the latest initiative of liberalization, at the same time sovereign risk needs to be addressed by adequate safeguards. We Suggest as a mandatory condition while granting approval, the Indian government should provide for rights of regular inspection, regulation of sales including export, scrap disposal, , placement of permanent security including military personnel and regular visit of security agency. The sale, scrap, information and raw material and components movement need close 100 % monitoring. The license condition should provide for sovereign action including right to recall the license, in case of any risk or even potential of any risk. We can’t and we will not repeat East India Company. India is capable,
Competent, strong, credible and is fully confident.