Measures taken to improve domestic defence manufacturing – UPSC

Positive Indigenisation list: Centre has announced positive indigenisation list. The positive indigenisation list essentially means that the Armed Forces will only procure the listed items from domestic manufacturers. The manufacturers could be private sector players or Defense Public Sector Undertakings(DPSUs).

In May 2020, the foreign direct investment (FDI) limit under the automatic route in the defence sector was hiked from 49% to 74%.

In October 2021 the government dissolved the four-decade-old Ordnance Factory Board (OFB) and amalgamated 41 factories under seven new state-owned companies to manufacture defence hardware ranging from munitions to heavy weapons and vehicles.

India has inaugurated two defence industrial corridors, one in Tamil Nadu and the other in Uttar Pradesh, to boost the flagship “Make in India” programme that in turn would attract investment as well as encourage employment generation.