Defence Minister Arun Jaitley on Thursday held a meeting with representatives from the industry over the proposed Strategic Partnership model, with sources saying that it is likely to come into force for a few of the identified sectors and might be approved by the Defence Acquisition Council (DAC) soon.
The DAC, which is chaired by the Defence Minister, is set to meet on Monday, when it may discuss the Strategic Partnership model, proposed to select key Indian private players for defence manufacturing projects, sources said, adding that its approval in the upcoming meeting has not been confirmed.
Jaitley's meeting with representatives of the industry came as an official statement said the government is looking towards institutionalising a "transparent" mechanism to encourage broader participation of the private sector in defence manufacturing under the Make in India framework.
The statement said the proposed Strategic Partnership model is intended to "enhance competition, increase efficiencies, facilitate faster and more significant absorption of technology, create a tiered industrial ecosystem, ensure development of a wider skill base, trigger innovation and enable participation in global value chains as well as promote exports."
As per sources, unlike the recommendations of the committee under former DRDO chief V.K. Aatre, the Defence Ministry may not unilaterally nominate a Strategic Partner in the identified segments but a two-stage selection process will be put in place.
Under this process, a pool of six Indian companies will be created, and based on competition, one of them will be selected as the Strategic Partner.
Only one company can be the strategic partner for one segment.
"This would gradually ensure greater self-reliance and dependability of supplies essential to meet national security objectives," the statement said.
It said that the industry representatives "welcomed" the efforts and made several suggestions, though the government did not give out any details.
The Strategic Partnership model was proposed after a report from a committee under former Director General (Acquisition) Dhirendra Singh suggested finding strategic partners for high-end defence production. A task force was constituted by the Defence Ministry under former DRDO chief V.K. Aatre, which among other things suggested fnalising only one or two partners for each sector.
The committee's report has been submitted, and it has categorised the sectors in two groups.
The first group includes aircraft, helicopters, aero engines, submarines, warships, guns, including artillery guns, and armoured vehicles including tanks, and it has been suggested that only one partner should be finalised for these.
The second group includes metallic material and alloys, non-metallic material, including composites and polymers, and ammunition including smart ammunition, for which the Task Force said two partners can be identified.
According to sources, the partnership model will be kick-started in four of the 10 identified sectors - single-engine fighter aircraft, helicopters, submarines and armoured vehicles and main battle tanks.
The private industry will also have a tie-up with an international original equipment manufacturer for these.
A chapter on this model was supposed to be there in the new Defence Procurement Procedure that was released by former Defence Minister Manohar Parrikar last year.
--IANS
ao/rn
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