India’s defence sector has long been the fief of sprawling public sector institutions, with research and development, in particular, seeing little private participation. However, the Union government has begun ramping up its efforts to bring more private sector participation to the field, especially from start-ups working on innovative solutions.
Earlier this week, the Centre announced that it would set aside Rs 500 crore to invest into start-ups working on defence products and solutions, with government officials including Union Minister for Defence Rajnath Singh pointing out at DefConnect 2019 that as many as 250 start-ups may be funded by the programme.
The announcement was made during the launch of the third phase of the Defence India Startup Challenge (DISC) under the Innovations for Defence Excellence (iDEX) platform, which is focused toward boosting innovation in the defence manufacturing space by recognising talent amongst the youth, MSMEs, start-ups and fast emerging private sector and harnessing it.
“India will emerge as an exporter of defence technologies and it can be achieved through ideation, innovation and incubation in cutting-edge technologies,” Singh said, adding that with the talent Indians possess, he was confident that “we can become $10-trillion economy in the next 10-15 years”.
Singh also highlighted other government initiatives like Make in India, Startup India and the Atal Innovation Mission and said that the priority was to create a conducive environment for innovation. “The incubation of ideas in the most critical challenge. Unless the process of careful and passionate incubation provides the ideal environment for nurturing and hand holding a creation, projects might fail,” he said.
The substantial fund for defence-oriented start-ups is not the first such incentive the Centre has announced for the critical field. Earlier in October, the Defence Ministry relaxed rules for start-ups in procurement regulations. The ministry had stipulated that for defence contracts valued at less than Rs 150 crore, start-ups will be encouraged to make a clear distinction between large firms and start-ups in terms of contract awards.
The third phase of the Defence India Startup Challenge, however, is part of its plans to increase localisation of defence R&D. Under the programme, selected startups will work on solving three challenges from the Army, Navy, and Air Force.
India’s arms imports second largest in the world
According to iDEX, India was the world’s second-largest importer of arms between 2014 and 2018 with a 9.5 per cent share of the global trade and is shell out another $220 billion over the next decade in order to modernise its forces.