On 30 Apr 2020 the Prime Minister (PM) held a meeting with various stakeholders to discuss ways to boost the Defence and Aerospace sector¹. Within a fortnight of this important meeting, the Defence Minister has launched the Defence Testing Infrastructure Scheme (DTIS) at an investment of Rs 400 Crores².

This article connects the above two developments and tries to identify the emerging pattern which actually reflects a kind of mind set of the Govt in pursuing a consistent policy in matters defence.

The 30th Apr Meeting

When the world at large was deeply embroiled in managing the grim realities of the global pandemic, the PM was busy in discussing ways to boost the defence and aerospace sector. He held a meeting with the stakeholders on this issue on 30 Apr 2020. What could have driven this action so much apart from the usual stuff of managing Covid-19. Probably the following:-

1. It appears that the PM realises it too well that Covid or no Covid, nothing much is likely to change in the threat equation with our potential adversaries. The same will revert to pre-Covid days in the time and pace which the countries’ economies would permit.

2. With the defence budgets that would take a big hit, the modus- operandi must shift to ‘sustenance’ rather than new procurements; especially the big ticket items.
3. Rather than looking at the foreign Original Equipment Manufacturers (OEMs) who would also have been hit with multiple Covid blues (liquidity, lay-offs, unsold inventory etc.), it is time to look inwards and strengthen the indigenous muscle (a sentiment reiterated later in his nation-wide call on 12 May 2020 for ‘Atmanirbhar Bharat’).
4. Of particular importance at this stage are three issues; one, holding the hand of private sector, two, pulling the public sector out of its default ‘complacency stance’ and three, clearing the malice that plagues institutions and procedures related to defence procurement and by implication, defence preparedness.
5. The ‘Make-in-India’ vehicle has already got a move on, the requirement is to accelerate its pace to realise the self-reliance dream.

Thrust Areas

Probably guided by the above thoughts , the PM drove the agenda on 30 April 2020 by laying on the table six thrust areas as under^3,4:-

1. Going ahead with the corporatisation of the Ordnance Factories – a need identified for decades and an agenda point in the 167 transformational ideas of the current Government pledged to be completed within 100 days in office.
2. Streamlining procurement procedures which refuse to shed their sub-optimality despite many an efforts through successive revision of Defence Procurement Procedure (DPP) Manuals or pushing corrections though institutional Govt-Industry interaction forums (CII, FICCI, PHD etc).
3. Carry out a focussed resource allocation; a fait accompli option in the post-Covid scenario. The aim being to ensure that pandemic notwithstanding, there is no shortfall in defence preparedness to fight ‘immediate wars’ that may be thrust upon the country.
4. Encouraging R&D and innovation as being the only route to ‘atmanirbharta’. In that, mopping up the gains of the ongoing initiative called ‘Innovation for Defence Excellence or iDEX (not elaborated further).
5. Hand-hold the defence industry through economic packages, subsidies, GST relaxations and more (hope that the talk will be walked), especially, as it relates to the Micro Small and Medium Enterprises (MSMEs) many of which (19-43%) are facing existential crises.
6. Boosting defence exports, firstly, by shunning the myth that the nation has no worthwhile defence exports and, secondly, realising that if the laudable export target of 5 billion USD by 2025 is to be realised, the private sector must be fully supported.

The deliberations of the meeting gives a clear insight into the mind of the current leadership which appears to be determined to ensure that the country’s ‘surakshakavach’ is up and ready; Covid or no Covid. The Government also seems determined to push the Make-in-India agenda with all the means at its disposal.

In the Make-in-India follow up actions, one of the strong thrust areas of the Government has been to incentivise the defence private sector making it realise its full potential.

Make-in-India: a Journey Over the Years

In fact, ever since the Make-in-India got launched in Sep 2014, there have been many initiatives by the Ministry of Defence (MoD) to move positively forward as regards the defence private sector especially the MSMEs.

This journey has been uphill; dotted on one side with several successes and on the other, with many a failures, un-fulfilled promises and an alleged stance of much noise and sloganeering on Make-in-India while the actual order books of the private players remained nearly blank for years…. Some of the positive developments have been the following:-

1. Despites all the confusions and doubts, the enabling vehicles of Make- I (Govt funded) and Make-II (Industry funded) procedures have started to move forward.
2. The promised reservation for MSMEs in Make-II which remained only in name for many years has started to show allocation in certain procurements. In this context, the statement of the Finance Minister on 15 May 2020 that the tenders up to 200 Crs will be for the domestic industry is relevant.
3. The Strategic Partnership Model and Public Private Partnership model has shed much of its ambiguity after having been discussed repeatedly in many Government-industry interactions on institutional platforms.
4. After years of NO GO and lip service, the private players have lately started tasting initial successes in big ticket procurements. Here are some examples:-

1. Mahindra Defence was selected by the US major BAE systems to establish a huge Assembly, Integration and Testing (AIT) facility for the production of M 777 ultra-light Howitzers in India as a part of a high value contract valued at 5070 Crs⁵.
2. Establishing a record of sorts, four major private sector players, namely, Bharat Forge, Tata Power Strategic Equipment Division (SED), Mahindra Defence and Punj Loyd are jointly participating in the biggest Public Private Partnership ( PPP) model with Ordnance factories Board (OFB) for the indigenous production of 155mm Advanced Towed Artillery Gun System (ATAGS); a contract valued at 3365Crs.⁶.
3. For the first time in the history of Private sector, Larsen and Toubro (L&T) in collaboration with the South Korean OEM Hanwha Land Systems (HTW) has won a global contract on international level for the supply of 100 K9 Vajra howitzers to the Indian Army. Out of the above hundred L&T is to make 90 of them in India while only 10 will come from HTW based on a contract valued at 4366 Crs⁷.
4. Tata Power SED has won a global tender worth 1200 Crs for supplying 23 numbers of three dimensional ship-borne surveillance radars to the Indian Navy.
5. Very recently (Apr 2020) L&Thas won a contract for 2500-5000 Crs for establishing a comprehensive unified Network Management System for the Indian Army⁸

   This List can go on…

Writing on the Wall – Implications

The above pattern indicates that despite all its woes and problems the private sector is coming of age slowly but steadily, wherein, it is marking its entry in the co-development and co-production and manufacture of big ticket items and weapon platforms.

One of the very big requirements for the above type of weapon platforms is ‘integration’ and ‘testing’; especially the later. For executing these tasks, huge and specialised infrastructure is required.

Just to illustrate the above point, following types of tests are required for a typical weapon platform consisting of a sensor (implying radars) , shooters ( missiles, guns) and battle management command and control system called BMC2 system (implying headquarter element). This list is only illustrative and is nowhere near complete:-

1. The radars will have to go through hundreds of tests to check out the following:-
1. The claimed technical characteristics such as peak power, pulse repetition frequency, band width are actually being achieved.
2. The beam formation from the antenna is as per the pattern claimed.
3. What is the compatibility of the sensor to operate in a dense electronic environment (called electromagnetic compatibility and electromagnetic interference or EMC/EMI tests).
4. Capability of the sensor to operate in a hostile electronic warfare (EW) environment.
   …. And many more.
2. Similarly the missiles have to go through hundreds of tests such as the following:-
1. Checking the dynamic performance of missiles in flight (for this, especially created wind-tunnels are required).
2. Checking out the performance of booster and sustainer rocket motors.
3. Checking out navigation system, auto-pilot system and data flow bus.
4. Checking out the dynamic performance of active seeker in acquiring the targets.
5. Checking the efficacy of warhead.
6. Once the missile is actually in flight, electronic, as well as, Electro-optical Tracking system (EOTS) are required to check out the missile flight from launch till end game
3. Similarly a typical BMC2 system will go through performance checks, EMC/EMI tests, operability in EW environment test, checks of data flow bus, check for connectivity with similar and dissimilar systems in a net-centric environment.

Testing and Integration – Some Facts

In fact, itwill require a separate volume to simply list out what a rigorous and a comprehensive test schedule has to be gone through to get a weapon system validated. Initial production of the prototype is only the start point.

All this testing costs huge amount of funds, specialised infrastructure resources and time which is a big burden on most of the private players working with tight budget.

Most of the private players, devoid of such facilities are compelled to pick up huge costs and time penalties in sending their equipment abroad, or hire facilities in India (rarely) to get their products tested.

On the other hand, the country’s public sector has a full regime of integration and testing resources. Just to mention a few:-

1. Defence Research and Development Organisation (DRDO) has a network of 52 laboratories. Each laboratory is well equipped for the testing and integration of the product it makes. This could include armaments, aerospace products, missiles, combat engineering equipment, live sciences, naval systems, aeronautics, unmanned systems and more.
2. Besides this, the Defence Public Sector Undertakings (DPSUs) have an elaborate regime of integration and test facilities. For instance Bharat Electronics Ltd has recently established an elaborate Defence Systems Integration Complex with an investment of more than $120 million. ⁹
3. The Integrated Test Range of the DRDO is state-of-the-art test and evaluation facility that is capable of providing all the facilities for a missile launch end-to-end, besides having a network of radars to track the missile flight from start till the end. ¹⁰

The First Major Step by the Govt in Facility Sharing

Fully aware of the above skewed position between the private and public sector, the MoD took a major step in Aug 2019. In fact the first announcement by the MoD came in Jul 2018¹¹, which was reiterated by the Defence Minister in Aug 2019). Salient points:-

1. The Defence Minister announced that the test facilities of the Govt and the Services will be shared with the private players. This was a long pending demand of the private sector to provide a level playing field¹².
2. This announcement was followed up by the MOD in issuing a Standard Operating Procedure that gave out the details of the nodal officers and the list of test facilities offered¹³.

The test facilities offered covered almost the entire canvass to include the test assets of OFB, DPSUs, DGQA, DRDO and the Services.

The facilities provided a full-spectrum activity like testing, trials, proof firing, field firing and more.

As the time passed, it was realised that while the facilities were offered but the private sector could not derive much advantage. There were several reasons for the same. For instance, the work schedule was so packed already by the prime user that there were hardly any slots that were free to be offered. Besides this, there were a lot of procedural hassles of reservations, bookings, approvals etc.

The Current Announcement by the Defence Minister

While all this and more was happening came the announcement by the Defence Minister on 15 May 2020. Salient details of the same are given below:-

1. TheMoD announced a huge investment of 400Crs in unrolling the Defence Testing and Infrastructure Scheme (DTIS).
2. For execution of DTIS, the Ministry will invite consortiums from Industry, associations and academia to set up and run (Built Operate Maintain or BOM model) eight greenfield ranges for defence and aerospace related production.
3. The said ranges will provide diverse testing facilities for a variety of combat equipment such as unmanned aerial vehicles, EW equipment, software tools and algorithms, blast testing facilities for variety of warheads, drive test of vehicles on specially designed tracks, testing of ship motion etc.
4. For Implementing the DTIS, a Special Purpose Vehicle (SPV) has been created which will be constituted by industry, industry associations, academic institutions, R&D organisations etc.
5. The MoD will pick up 75% of the cost of setting up the DTIS the balance 25% will be borne by the private consortium as stated above.
6. The DTIS infrastructure is planned to come up in the existing Defence Industrial Corridors (DICs). Reportedly two DICs located at Tamil Nadu and Uttar Pradesh will house major infrastructure. It has also been clarified that the DTIS will not only be confined to the DICs alone; some facilities may be established outside of it also.

Some Thoughts on DTIS

Some points on the DTIS are outlined below:-

1. DTIS is a major step forward.
2. It marks a continuity of thought and action from the initial decision taken in July 2018 to allow the public sector test and integration facilities to be used by the private sector players.
3. In all probability, the MoD would have been aware that while the decision was made way back in Jul 2018, the fruits of the same have actually not been enjoyed by the private players for reasons mentioned earlier.
4. DTIS is step-2 which takes the idea forward on a major scale but without the problem set of the July 2018 model.
5. The scale of DTIS is massive and in fact in conformity with the range and depth of equipment being handled or likely to be handled by the private players in times to come.
6. Also, the same is in sync with the clarion call given by the Prime Minister to boost the Defence and Aerospace Sector when much of the world is struggling out of the Covid-19 imbroglio.
7. The only challenge to the realisation of the DTIS will be ‘system inertia’ in getting the approvals through the labyrinth of the bureaucratic chain, timely setting up and operationalisation of the SPV, release of funds and creation of infrastructure in a mission mode.

Having reached this far, WE WILL that is the hope.

References

1. “PM holds a meeting to discuss ways to boost defence and aerospacesector,”atwww.pmindia.gov.in. Accesses on 16 May 2020.

2. “Rajnath approves Rs 400 Cr scheme foe testing infrasture,” at www.hindistantimes.com.Accessed on 16 May 2020.
3. 1 ibid.
4. “A visionary leader gives a clarion call- far beyond covid,” aw www.sadr.com. Accessed on 16 May 2020.
5. Ibid. Accessed on 16 May 2020.
6. “ In policy reversal, Private companies to build Indian howitzer, “at www.defensenes.com. Accessed on 16 May 2020.
7. “Indian Army : Indian Army gets new teeth, K 9 Vajra . M777 howitzers inducted,” at www.m.economictimes.com.Accessed on 16 May 2020.
8. “Larsen and Toubro wins large contract from Indian Army for Advanced IT-enabled network,” at www.indiatimes.economictimes.com.Accessed on 19 May 2020.
9. “India’s BEL eyes missile integration market,” at www.defensenews.com.Accessed on 19 May 2020.
10. “Integrated Rest Range 9ITR) ‘/DRDO.” At www.drdo.gov.in.Accessed on 19 May 2020.
11. “Test in India: Military ranges, labs opened to private players to test equipment,” Accessed on 19 May 2020.
12. “Govt defence test facilities to be opened up to te private sector,” at www.thehindu.cm. Accessed on 19 May 2020.
13. “Test facilities for private sector,” at www.makeinindiadefence.gov.in.Accessed on 19 May 2020.

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