NEW DELHI, Oct 30 (Reuters) – Indian defence companies will gain access to a potential $100 billion market over the next 10 years, following a new policy that allows domestic firms to bid for large defence contracts, officials said on Friday.
India, one of the world’s biggest arms importers, wants to increase the role of its private sector, which holds around 20 percent of the defence industry market but has the potential to grow significantly.
Under the new policy, the government will allow domestic companies to bid for key projects on their own.
Indian companies until the policy change were not invited by the government to bid for big government defence projects and were left to supplying locally made non-combative equipment for the defence forces.
With foreign countries reluctant to share advanced technology with India, the government wants to encourage private defence companies to enter the arms market, officials say.
"The field is now open for them to come and bid for any project along with the world’s best. The government is giving them an opportunity to expand their capabilities," Sitanshu Kar, the defence ministry spokesman said.
Local companies are free to bid for projects involving tanks, artillery and aircrafts, Kar said.
"This move can also save costs and help us turn India into a major production hub in the near future," Kar said.
The new policy will provide more opportunities to Indian companies such as Tata Motors <TAMO.BO>, Mahindra and Mahindra <MAHhM.BO>, Ashok Leyland <ASOK.BO> and Larsen and Toubro <LART.BO>, defence experts and officials said.
"The current review is primarily focused on two essential areas of promoting and facilitating wide participation of defence industry and enabling transparency and integrity in all acquisitions," defence minister A.K. Antony said at a conference.
"Over the next five to six years, the total budgetary provision for capital acquisition is likely to reach $50 billion," Antony said. Defence and company officials say it will touch the $100 billion mark in 10 years.
India wants to upgrade its largely Soviet-era arsenal to counter potential threats from Pakistan and China. The government plans to spend more than $30 billion over the next five years to upgrade its defences.
Foreign defence companies have welcomed the government move.
"The government is very forward leaning and the steps we view as a sign of the government’s confidence in the maturity of the Indian industry," Vivek Lall, India country head for Boeing Integrated Defense Systems <BA.N> said on Friday. (Editing by Matthias Williams and Sanjeev Miglani)
NEW DELHI (Reuters) – India has advised its citizens against travel to Pakistan, citing security reasons, the home (interior) ministry said on Tuesday, as ties between the two nuclear rivals continue strained.
Thousands of Indian pilgrims, mainly Sikhs, travel to Pakistan’s Punjab province, home to some of the most revered Sikh sites including the birthplace of Guru Nanak, the 15th century founder of their faith.
NEW DELHI, Oct 20 (Reuters) – India’s prime minister on Tuesday warned of a fresh militant attack and urged the armed forces to take measures to tackle security challenges nearly two weeks after a bomb attack on its embassy in Kabul.
"There are regular intelligence reports of imminent attacks in the country. This is a matter of deep concern, and there is no room for complacency," Prime Minister Manmohan Singh told a conference of the country’s combined armed forces.
"The terrorist attack on our embassy in Kabul on October 8 is yet another grim reminder of the forces we are pitted against," Singh said.
The overall security situation in the region, he said, had worsened.
The Kabul blast, for which the Taliban claimed responsibility, killed 17 people but harmed no embassy staff.
Singh said India had taken steps to strengthen its intelligence network and policing to thwart any attacks since the Mumbai attacks last year, which it blames on Pakistan-based militant groups.
Last month, Israel and Australia issued travel warnings to its citizens based on intelligence inputs on militant strikes.
Australia’s Victoria state Premier, John Brumby, cancelled his trip to Mumbai after the Australian government issued a travel warning to avoid Mumbai.
India has always accused Pakistan-based militant groups of orchestrating attacks on India and Singh told defence heads on Tuesday that both "state" and "non-state" actors were involved in militancy, without elaborating.
"We have, therefore, to improve our defensive mechanisms against all forms of terrorism, asymmetric warfare and aggravated militancy," he added.
India suspended a 2004 peace process with Pakistan after last November’s attack on Mumbai that killed 166 people, saying it could be resumed only if Pakistan acted to dismantle the "terrorist network" on its soil.
New Delhi blamed the attack on Pakistan-based militants who it said were supported by some official agencies. Pakistan denied official involvement, but accepted that the attack was partly planned on its soil. (Editing by Ron Popeski)
NEW DELHI, Oct 14 (Reuters) – India urged China on Wednesday to stop building projects inside the Pakistan-ruled part of the disputed Kashmir region, the latest salvo prompted by a decades-long border dispute between the Asian giants.
The sharp exchanges between the two sides underline the fragility of their relations despite a warming of ties in recent years, primarily on the back of burgeoning trade. The two sides fought a brief but bloody war in 1962.
"We hope that the Chinese side will take a long-term view of the India-China relations, and cease such activities in areas illegally occupied by Pakistan," an Indian foreign ministry statement said. India was reacting to a comment by Chinese President Hu Jintao reported by the official new agency Xinhua that China was "glad" to carry on the Pakistani projects.
It came a day after Beijing said it was "seriously dissatisfied" at a visit by India’s prime minister to the disputed Himalayan region of Arunachal Pradesh that is controlled by India but claimed by China.
Prime Minister Manmohan Singh travelled to the mountainous state, twice the size of Switzerland, earlier this month to woo voters ahead of a state assembly election.
Both countries jostle for resources and influence as they seek a global role. India has several anti-dumping cases against China pending with the WTO.
There has been a flurry of reports in Indian media of Chinese incursions along the border — shrugged off by both governments — and India this month protested against a Chinese embassy policy of issuing different visas to residents of Kashmir.
Beijing lays claim to 90,000 sq km (34,750 sq mile) of land in Arunachal Pradesh, and had already expressed its anger about a planned visit by the Dalai Lama in November. New Delhi sees Beijing as backing Pakistan and says Chinese involvement in Pakistan-held Kashmir was to undermine India.
India holds 45 percent of the disputed Himalayan region while Pakistan controls a third. China holds the remainder of Kashmir.
India and Pakistan, which claim Kashmir in full, have fought two of their three wars over Kashmir since their independence from Britain in 1947.
"The Chinese side is fully aware of India’s position and our concerns about Chinese activities in Pakistan Occupied Kashmir," the Indian statement said.
China is helping build a hydro-electric power plant and highways in Pakistan-ruled Kashmir.
New Delhi also expressed concern on Wednesday over increased incursions by Pakistan-based militants into Indian Kashmir that has led to sudden spurt of separatist violence in the region. (Additional reporting by Sheikh Mushtaq; Editing by Krittivas Mukherjee and Alex Richardson)
NEW DELHI (Reuters) – India and the United States began a massive joint military exercise on Monday, underscoring their deepening security ties they view as crucial in a troubled South Asia region.
Hundreds of soldiers using heavy transport aircraft and battle tanks are participating in the biggest-ever war games between the two countries which were on the opposing side of the Cold War but now seek to build strategic and military ties.
I have been noticing a debate in newspapers and television channels about the need to call in the army to tackle the Maoists and wonder whether it is indeed time to turn towards them before the movement spirals out of control.Last week, hundreds of Maoists, who are expanding their influence in India, chased away police from a tribal area based around the town of Lalgarh about 170 km (100 miles) from Kolkata, capital of West Bengal state.By attacking Lalgarh and then keeping the police at bay for four days, the Maoists demonstrated their growing influence over poor villagers and their capability to strike close to a big city like Kolkata.(For Analysis on how Maoist insurgency can hurt industry in India, click here )Thousands of villagers caught in the crossfire have left their homes in panic and have been put up in makeshift government camps. They are clearly shaken by the siege and the subsequent police campaign to sanitise Lalgarh.Indian states have time and again asked the central government that it might need the army to fight the Maoist movement, which is rapidly spreading in the country.But for the moment, India is banking on the police to tackle the Maoists and equipping its forces with modern weapons and training to fight the Maoists in their own den.Experts say it is clear that the strategy of the rebels with their 22,000 plus combatants is to encircle bigger towns and cities and could hit industry.Maybe Indian authorities should also rework their strategy as the police with their limited prowess have always been soft targets in rural areas and have failed to gain confidence of poor villagers.Will India look to deploy the army at some stage?(Reuters photo of a paramilitary soldier keeping watch from a tree in Jhitka near Lalgarh June 21, 2009)