Modi government to make investment of Rs 30 billion in UP Defence Corridor

UP setting up Defence Production Management Cell for Rs 200 billion project

The Narendra Modi government would invest about Rs 30 billion in the proposed UP Defence Corridor, which in turn is expected to generate a total investment of Rs 200 billion.

The central government investment would be made for creating necessary infrastructure such as ammunition blast testing centre to facilitate ‘plug and play’ model by the private sector companies in setting up their facilities.

Union minister of state for defence Subhash Bhamre today said here the central investment of Rs 30 billion would be in addition to the Rs 200 billion projected to flow in the form of private investment in the corridor.

Bhamre was in town to interact with the Micro, Small and Medium Enterprises (MSME) as part of the consultative programme to handhold local industry and encourage them to set up their defence production units. A similar programme was held at Agra yesterday, while Kanpur would host another edition on May 14. The meeting was attended by senior officials of the army and air force apart from UP government representatives.

“We want to encourage the private sector to contribute to defence manufacturing in a big way just like it is the case with USA, China and Israel,” he said adding the previous regimes were depended upon government companies for defence ware or on imports.

Meanwhile, the Yogi Adityanath government has decided to set up a Defence Production Management Cell to speed up the corridor projects by hiring experts, including retired armed forces personnel. Last month, defence minister Nirmala Sitharaman had visited Jhansi, the eponymous ground zero of the proposed Defence Corridor in Bundelkhand.

Meanwhile, Lt Gen Subrata Saha, who is director general Society of Indian Defence Manufacturers (SIDM), said of the two defence corridors proposed in UP and Tamil Nadu, the UP project was vital since it was near the Northern Front of China.

UP industry minister Satish Mahan said the state would provide a slew of incentives and subsidies to the private sector with regards to land, R&D, testing unit, capital expenditure, infrastructure etc.

UP infrastructure and industrial development commissioner (IIDC) Anup Chandra Pandey said the government had appointed a consultant for a pre-feasibility report on the corridor, which would be prepared within three months.

The Centre on its part is encouraging the foreign defence manufacturers to forge alliances with the Indian companies for joint production with the terms of technology transfer.

After inaugurating UP Investors Summit 2018 in Lucknow on 21 February, Modi had announced the setting up of the defence corridor in Bundelkhand. The hub would comprise 6 districts viz. Aligarh, Agra, Jhansi, Kanpur, Lucknow and Chitrakoot.

The state has identified 3000 hectares for the proposed corridor and on-boarded Indian Institute of Technology, Kanpur (IIT-K) and Banaras Hindu University (BHU) as knowledge partners owing to their expertise in defence, aviation and ammunition related researches.

UP possesses skilled metal workmanship, besides an established defence manufacturing base in Kanpur spanning 6 public sector units of arms and defence ware. India is the world’s largest military hardware importer and among top five military spenders. While Kanpur has ordnance units, Lucknow has a Hindustan Aeronautics Limited (HAL) unit.

The Centre wants the Adityanath government to leverage its large MSME base and the presence of defence related units in UP to boost the prospects of the UP Defence Corridor for both import substitution and promoting exports.