Inaugurating the 10th 'Aero India' show here, the Prime Minister said while the country needs to increase its defence preparedness and modernise its forces due to security challenges that were well known, it should aim to manufacture 70 percent of military hardware domestically in next five years and remove the tag of being number one importer of defence equipment.

In Pics: India flies high at Aero India show

Stressing that developing domestic defence industry "is at the heart of the 'Make in India' programme", he said, "We will build an industry that will have room for everyone - public sector, private sector and foreign firms".

"From sellers, foreign firms must turn into strategic partners. We need their technology, skills, systems integration and manufacturing strength," he said.

He said the foreign players can use India as part of their global supply chain and India's frugal but sophisticated manufacturing and engineering services sectors can help reduce costs. Also India can be a base for export to third countries, especially because of its growing defence partnerships in Asia and beyond, he said.

He further said the government was reforming defence procurement policies and procedures.
     
Modi noted that his government has raised the permitted level of Foreign Direct Investment to 49 percent and this can go higher, if the project brings state-of-the art technology.      

"We have permitted investments up to 24 percent by Foreign Institutional Investments. And, there is no longer a need to have a single Indian investor with at least a 51 percent stake. Industrial licensing requirements have been eliminated for a number of items. Where it is needed, the process has been simplified," he said.

Read More: Flying start to Aero India 2015 in Bengaluru

The Prime Minister said that effort is on to expand the role of private sector, even for major platforms.

Modi told the participating overseas delegations that for too many of them India is a major business opportunity with the reputation as the largest importer of defence equipment in the world.

"That may be music to the ears of some of you here but this is one area where we would not like to be number one," Modi said at the biennial event, being attended by more than 250 Indian companies and 300 foreign firms.
Ruing that India spends "tens of billions of dollars on acquisitions from abroad", Modi said government's focus is to reduce imports and develop domestic defence industry with a  sense of mission which "is at the heart of our Make in India programme".

The Prime Minister expressed confidence that India will emerge as a major global centre for defence industry. Modi said a strong defence industry would not only make the country more secure but also make it more prosperous.

Also Read: Senior US officials to participate in Aero India show

Modi pointed out that in India, the defence industry in the government sector alone employs nearly 200,000 workers and thousands of engineers and scientists. They produce an output of nearly USD seven billion dollars annually and also supports a very large pool of small and medium enterprises, he said.

Must Read: Aero India 2015: Metal birds awe spectators with aerial aerobatics

Noting that India imports up to 60 percent in defence sector, he said there are studies that show that even a 20 to 25 percent reduction in imports could directly create an additional 100,000 to 120,000 highly skilled jobs in India.
      
"If we could raise the percentage of domestic procurement from 40 percent to 70 percent in the next five years, we would double the output in our defence industry," he said.



Modi underlined that defence budgets around the world are becoming tighter. "India's frugal but sophisticated manufacturing and engineering services sectors can help reduce costs. India can also be a base for export to third countries, especially because of India's growing defence partnerships in Asia and beyond," he said.
     
A strong defence industry can boost investment, expand manufacturing, support enterprise, raise the technology level and increase economic growth in the country, the Prime Minister said.
    
Modi said his government had made export policies clearer, simpler and predictable.
     
Modi also spoke about involving country's scientists soldiers, academia, industry and independent experts more closely in research and development. Government's support for research and development is essential for defence sector and, it should also be accompanied by a degree of assurance on purchase, he said.

Also Read: Hope government will look afresh at US defence foundational agreements: Kohler

The 10th international edition of the aerospace and aviation exhibition has participation of 54 ministerial and other high-level delegations from several countries. Over 600 companies, including 295 Indian and 328 foreign companies, are taking part.

The US with 64 companies has the biggest presence at the event, said to be the largest ever air show to be hosted so far in India, in which 33 other countries are taking part.

France is the second biggest participant with 58 companies, followed by the UK with 48, Russia with 41, Israel with 25 and Germany with 17, organisers said.

Indian Air Force Sarang Team and air display teams from Sweden, UK, Czech Republic and open sky jump by USA Special Forces are among the top draws at the event. Seven of the 11 foreign military aircraft on display are American - two F-15C Eagles, two F-16C Fighting Falcons, one Boeing KC-135 tanker, one C-17 Globemaster III and a P-8A Poseidon maritime surveillance aircraft.

Three Rafale fighters of French giant Dassault - shortlisted for acquisition by the IAF - will fly aerobatics displays.

Latest News from India News Desk