Defence firms seek simplification of norms to achieve Make in India goals

Aequs SEZ, a Belagavi-based aerospace SEZ, has urged the defence minister to create Single Window Agency for private firms to register with defence agencies

Private sector firms, engaged in the manufacture of defence equipment, have urged the government to simplify procedures so that they can contribute effectively to the Make in India programme. They have asked the defence ministry to create a single window for registration of their entities and products to cut down the time taken for the process.

Currently, entrepreneurs need to register with each of over 40 defence agencies, and this process takes more than three years to complete. “The process for registering private entrepreneurs interested in serving the Indian defence, needs to be dramatically streamlined. The current process is a needlessly expensive and time consuming process,” said Rajeev Kaul, CFO and Managing Director, Aequs SEZ said.

Creation of a single window agency would simplify procedures for private enterprises to register their entities and products meant for defence use, he said.

Making a presentation to Defence Minister Manohar Parrikar during his visit to Aero India, here last week, Kaul said, in order to exploit the full potential of Make in India, it was necessary to create a world-class infrastructure including water, power, roads, telecommunication, ports and airports for manufacturing enterprises to flourish. This would bring dozens of Tier-2 and Tier-3 cities into the manufacturing ecosystem, he said.

Aequs SEZ in Belagavi is specialised in engineering, machining, sheet metal fabrication, assembly, forging and special processing for the aerospace, automotive, and oil & gas industries. Its customers include Airbus, UTAS, Eaton, Baker Hughes, Halliburton, and Bosch.

He also emphasised the need skilled machinists, turners and related technicians to operate advanced manufacturing machinery. The current pipeline of such talent is inadequate. The country needs many more these and upgrade the existing ones to provide hands-on learning on equipment and processes actually used in the precision engineering industry, he said.

“The government can accelerate this process by incentivising the private-public-partnerships (PPPs) between ITIs and private manufacturers to increase and upgrade technical training institutes,” Kaul said.

Further, he said the shortage of technical talent in the manufacturing industry is exacerbated by rigid labour laws which restrict the number of overtime hours employees may put in. These labour laws slow growth of the indigenous manufacturing sector, stifle India’s ability to capture a larger share of the global market of precision engineering, thus denying Make in India a “win-win” opportunity for employees and manufacturers alike, he said.

As regards to the financial incentives provided to the manufacturing Special Economic Zones (SEZs), removing the Minimum Alternate Tax (MAT) for the highly capital-intensive industries, such as aerospace manufacturing, would accelerate Make in India, he said.

“India has so much potential in terms of the demographic dividend, a strong domestic demand, strong IP protection and legal framework, investment-friendly policies, and a diverse manufacturing base. By focusing on a few high leverage economic factors, we will enable India to capture the full potential of Make in India,” Kaul added.