Govt eases defence export rules, widens access to global market

OGEL validity has been increased from two to three years, while its country coverage has been expanded, barring sensitive nations and those under UN sanctions

The Ministry of Defence on Friday simplified India’s Defence Export Standard Operating Procedure (SOP) and widened the Open General Export Licence (OGEL) framework to reduce procedural delays and provide defence manufacturers with faster access to overseas markets.

 

The reforms, undertaken by the Department of Defence Production (DDP) under the guidance of Defence Minister Rajnath Singh, remove stakeholder consultation for exports of non-lethal defence items to most destinations, while retaining safeguards for sensitive countries.

 

Consultation has also been removed for exports of all items for international tenders and exhibitions, allowing companies to pursue overseas opportunities more quickly.

 

These changes aim to help Indian defence companies access overseas markets faster and respond more quickly to global business opportunities, while retaining safeguards for national security.

 

 

“The reforms move India’s defence export regime towards a more comprehensive and facilitation-based system,” the ministry said in a media statement, adding that safeguards for sensitive items, technologies and destinations would remain in place.

 

Major reforms

 

The key change is the expansion of OGEL, a one-time export authorisation that allows eligible exporters to self-generate authorisations for multiple consignments of specified defence items without seeking separate approval for each shipment. The government has merged three existing OGEL SOPs covering major platforms and equipment, parts and components, and intra-company transfer of technology into a single framework.

 

The validity has also been increased from two to three years, while the coverage of eligible countries has been expanded from 41 countries to all countries, except negative or sensitive nations and those facing United Nations Security Council sanctions or arms embargoes.

 

“There are two big takeaways from the announcement, especially for innovative MSMEs. First, we are now free to showcase what we have made. Second, we can get one licence and have the world as our market. This means we can focus on innovation while the government takes care of the paperwork,” said Abhishek Jain, co-founder of Pune-based smart and autonomous munitions manufacturing firm Zeus Numerix, emphasising how the simplified export process could allow MSMEs to focus more on developing products and less on navigating regulatory procedures.

 

A new provision also covers Indian companies with long-term contracts or agreements with foreign original equipment manufacturers — with OGEL validity aligned with the contract — subject to conditions.

 

According to a notification issued by the DDP on Thursday, applicants seeking an OGEL need to submit a valid Importer Exporter Code, certificates issued by customs, declarations on sanction compliance, end-user checks and government inspection, along with an item-wise list of exports and destination countries with intended end use.

 

Earlier process

 

Before OGEL, defence exports generally required separate government authorisation for individual export processes, making repeat shipments and regular exports slower.

 

The government introduced OGEL in 2019, following demands from exporters, to make defence exports easier. It was designed as a one-time licence allowing a company to export specified items to specified countries during the licence period without seeking fresh export permission for every shipment. The initial OGEL was valid for two years for selected allied countries.

 

The range of items eligible under OGEL has also been expanded, including permission for civil-use exports of specified parts and components of small-calibre arms and protective equipment. The changes could help manufacturers respond faster to international tenders, exhibitions and long-term foreign OEM contracts. 

Fresh framework 

• No stakeholder consultation for non-lethal defence exports and exports for international tenders and exhibitions
• Three existing open general export licence (OGEL) SOPs merged into a single framework
• OGEL validity increased from two to three years
• Country coverage expanded from 41 to all countries, except those with UN sanctions and embargoes