Modi says India now world's most open economy; approves 100 per cent FDI in defence, aviation

ezsasa

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could you pls elucidate a bit on the underlined part?
I was referring to the fact that the current government has let us known their agenda in the last two years, which did not exist in earlier government.

Let me go thru some ministries on some of the key projects and policy:

1) Defence ministry : All of us on DFI agree that there has never been this many equipment either in induction mode , testing mode or procurement mode, in comparison to last 10 years. Moreover the defence procurement policy 2016 has made it clear that MoD prefers domestically procured equipment compared to imported ones. Fundamental change is that defence acquisition council is meeting almost every month, there is movement forward on some topic or other.
2) Transport ministry : They have announced that they are going to extend national highways from 95K KM to 2 lakh KM. going by tenders new projects they are spending 1000 crores for every 100 KM on a average.
3) Shipping ministry : Inland waterways projects and sagar Mala project, both are good ones.
4) Power ministry : other than LED replacement, rural electrification. UDAY project is designed to bring state DISCOMS out of bankruptcy. They also have the target of 100 GW of renewable energy.
5) Ministry of commerce : State wise ranking of ease of doing business has been started by them. They seems to giving approvals to companies at a faster pace. incase of defence FDI, seeing that investments are not coming in for 49% FDI in defence they reacted and changed the policy to 100%.
6) Railways : East and West Freight corridors, Overbridge constructions, revamping the internal financial management within railways.

There are more , but it will end up being a essay.

The point is that there were no concrete growth targets prior to modi, Now that there are targets we now know how much finance is needed for at least till 2022 medium term. the requirement of monies is huge which cannot be fully funded with the existing cash flow in the country or external loans.Mind you our budget for current year is about 20 lakh crores. This is where FDI comes into the picture.

Hope i have made my point clear.
 

Kshatriya87

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It's easy to say "No"..
Can you think of better alternatives, which have a positive impact in a fixed timeframe of 10 years?
Make your own defence industry strong. If necessary, government should open its own manufacturing units in collaboration with Indian companies. FDI should be made 100% in other/civilian industries. NOT DEFENCE.
 

Indx TechStyle

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Wrong move. Modiji is turning from an ordinary US lackey to a complete puppet. Even long time US supporters like me are losing sleep over his lap dog behaviour to US president Obama.
You're exaggerating. Though we must be worrying about FDI in defense sector, there's no way if investments in civilian sector could make us puppet.
 

Peter

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You're exaggerating. Though we must be worrying about FDI in defense sector, there's no way if investments in civilian sector could make us puppet.

No exaggeration. Did you watch Arnab`s debate . Check his views on US Pharma companies and how the price of medicine will be changed by them if FDI without regulations(current status) is allowed.



Goto 38:36 and listen to Arnabs questions to Mr. Patra.
 

Kshatriya87

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‘Made in India’ F-16s on radar, thanks to FDI

U.S. firm Lockheed Martin may make use of liberalised norms
American military manufacturer Lockheed Martin could soon be producing F-16 fighters in an assembly line based in India, taking advantage of the new liberalised FDI conditions announced by the government on Monday.

If the legendary American fighter is deployed with the Indian Air Force after local production, it would signal a historic shift in India’s military posture that could dramatically affect the country’s relations with China, Pakistan and other nations. It could also draw much criticism to the fact that India was inducting a fighter that first took to the skies more than 40 years ago.

At least two senior officials in crucial ministries handling the issue confirmed that the proposal for setting up an assembly line for F-16 fighters in India was discussed during Prime Minister Narendra Modi’s visit to the U.S. earlier this month.

An official said the negotiations with the French government for the purchase of 36 Rafale fighters haven’t succeeded yet in securing a competitive price. “Lockheed Martin, on the other hand, is keen to close down its F16 production facility in the U.S. Talks are on to invite the company to shift its F16 production line, lock, stock and barrel, to India,” he said.

“This will serve the twin purposes: it will be a success story of Prime Minister Narendra Modi’s Make In India initiative plus it will address the Indian defence establishment’s requirement of a new fighter fleet,” the official added.

The second official confirmed that talks were on with Lockheed Martin for the F-16 assembly line in India.

In an interview to The Hindu last month, Defence Minister Manohar Parrikar indicated that India was looking at getting a foreign military firm to manufacture its fighter in India. “I am not looking for assembly at all. I am looking for a company to join with an Indian partner and to start manufacturing here by Transfer of Technology (ToT) in most of the items. I know that 100 per cent ToT may not be possible and 100 per cent indigenisation is not possible. Even with so many efforts, LCA has only around 40 per cent indigenisation,” he had said.

Several foreign defence firms have been expressing their willingness to set up assembly lines in India. Among them are the Eurofighter consortium ad Sweden’s Gripen. Both Lockheed Martin and Boeing from the U.S. in April held discussions in New Delhi in the presence of Pentagon's Director for International Cooperation Keith Webster about the possibility of producing their jets in India. While Lockheed has proposed F-16, Boeing has offered to make F/A-18s in India.

Based on ongoing discussions, sources said the opportunity to open an assembly line in India could ultimately go to Lockheed Martin, that too for a fighter that is going out of production. The company is believed to have orders only for a few more months, with the US military, F-16’s biggest customer, moving to more advanced fighters and foreign orders drying up.

For many in the air force it would be a surprising, and disappointing move, given that F-16s are a critical part of Pakistan air force’s fighter arm. Besides, it would be ensuring that F-16, a 40-year-old design and fourth generation fighter, would remain in the IAF for another 30-40 years.

“It would fulfil both Make in India projections and also give us an advanced fighter,” one source aware of the discussion told The Hindu.

Former Defence Minister A.K. Antony on Monday cautioned: “Allowing 100% FDI in the defence sector means India's defence sector is thrown mostly into the hands of Nato-American defence manufacturers.”

He went on to warn that if Nato-American defence manufacturers came into India then it would “affect India’s independent foreign policy too. It will also threaten the national security.” Further, it would have an adverse impact on the ongoing indigenous defence research activities, he said. “It is very important to note that all such changes happen immediately after PM Narendra Modi’s recent American visit,” he said.
 

Indx TechStyle

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It could also draw much criticism to the fact that India was inducting a fighter that first took to the skies more than 40 years ago.

Okay, I can understand this point.
“Lockheed Martin, on the other hand, is keen to close down its F16 production facility in the U.S. Talks are on to invite the company to shift its F16 production line, lock, stock and barrel, to India,” he said.
That's not a bad sign.
F-16 is still influential in global arms market and manufacturing them in India will benefit us.
I know it's fading now but still it will make our labour further skilled to do same indigenously in near future. Production lines successors could also be moved to India.
The company is believed to have orders only for a few more months, with the US military, F-16’s biggest customer, moving to more advanced fighters and foreign orders drying up.
Former Defence Minister A.K. Antony on Monday cautioned: “Allowing 100% FDI in the defence sector means India's defence sector is thrown mostly into the hands of Nato-American defence manufacturers.”
That goes funny now. Antony who ruined industry for years now expressing concerns. :p
Congis themselves had thrown Indian defense sector into hands of Russians, that even 70-75%.
I know current degree indigenization (40%) isn't good, but it's at least less pathetic than 25% of last time.
Government is targeting for 70% indigenization by 2020 and that can only be done if we don't take time to develop tech (we get it from somewhere) and that can only be done by ToT and FDI is essential to invite companies for Making equipment in India and transferring the tech.
it would “affect India’s independent foreign policy too. It will also threaten the national security.”
Independent foreign policy?
LOL. :hippo:
Congress itself had changed India into almost a Soviet Pet Dog.
This time we are at least balancing between yanks, rusks and chinks.
Plus we are giving more to others.
Further, it would have an adverse impact on the ongoing indigenous defence research activities, he said.
That's why Indigenization degree has been increased by 60% in last two years and defense exports rose to 220%.
Results will even be better after ToT.
Not a single major scam has happened. Killing defense industry with FDI is only possible, if they are allowed explore opportunities wrecklessly, which isn't happening.
Even companies like Finmeccanica was blacklisted.
I can understand if someone says that it will destroy domestic, but they are having Joint Ventures instead of competition. That's enough. :angel:
 

ezsasa

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Make your own defence industry strong. If necessary, government should open its own manufacturing units in collaboration with Indian companies. FDI should be made 100% in other/civilian industries. NOT DEFENCE.
For Domestic companies were good enough, we would have had major technologies being created from within india. But that did not happen.

There are three ways of getting the latest technologies in defence into the country:
1) develop yourself : not been a success so far, because other than Brahmos we don't have many things which can be called state of art. Even Brahmos is foreign collaboration. More over we don't spend enough on R&D.

2) TOT: we have been on this mode for last 30 years, no country gives their critical technologies even on license to other countries. We know this for a fact.

3) Make the foreign companies to setup shop here: this method costs the least to the government. Availability of technology is ensured because the foreign vendor is within our country. As long as L1 process is followed, cost factor is also take care of.

If the fear is that somehow foreign companies will come and subvert the economy and national security, worst case scenario all the people will go back on streets and make the foreigners leave. As citizens we have done it lots of times.

But regulators of individual sectors should take care of any problems.
 

sayareakd

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I dont think this 100% FDI in Defence will help.

We are not giving them definite orders.
We will not give them export of this product to unfriendly or neutral countries (example we wont allow the F16 made here to be sold to Pakistan)
We have lot of export restrictions on domestic companies selling their defence product to friendly countries.

Now the question is because of the all the above, why would any one first set up shop here and then go forward?

BTW read someplace that their was automatic 100% FDI if the company bring in state of the art tech, now they have changed that to modern tech. ( looks like earlier it was F35 now they are allowing F16)

Lets wait and watch.
 

ezsasa

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I dont think this 100% FDI in Defence will help.

We are not giving them definite orders.
We will not give them export of this product to unfriendly or neutral countries (example we wont allow the F16 made here to be sold to Pakistan)
We have lot of export restrictions on domestic companies selling their defence product to friendly countries.

Now the question is because of the all the above, why would any one first set up shop here and then go forward?

BTW read someplace that their was automatic 100% FDI if the company bring in state of the art tech, now they have changed that to modern tech. ( looks like earlier it was F35 now they are allowing F16)

Lets wait and watch.
The question of allowing defence exports to friendly countries has already been answered both by modi and Parrikar, both categorically said that products made can be exported.


There is approval process for defence exports in all countries, companies do not export without their respective country's approval.

In all probability there will be a pre approved list of defence items that can be sold to a list of countries, depending on the demand.

And I don't think F16 will ever be made in india.
 

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