Industry Largely Welcomes, Experts Cautious On Hiked FDI In Defence

"This is a huge opportunity for SMEs to build up their manufacturing capabilities as the 'Make' category (in the Defence Procurement Procedure) will ensure Indian companies benefit," Haridas told IANS.

Salt-to-software conglomerate Tata Sons too was upbeat.

"We do see the need for significant investment in the sector and such investment, including from the Indian private sector, deserves encouragement. The Tata group's presence in the sector, as demonstrated in the Defexpo this year, is substantial, growing and reflects our commitment to playing our role in the growth of the sector," a Tata Sons spokesperson told IANS in Hyderabad.

Tata Advanced Systems Limited (TASL), a wholly owned subsidiary of Tata Sons, has four units in the Aerospace Special Economic Zone at Adibatla in Hyderabad. It has partnerships with Sikorsky, Lockheed Martin and RUAG Aviation for different units.

Echoing the general sentiment was the Punj Lloyd Group that manufactures a range of equipment for the armed forces.

The hiked cap "will now encourage foreign defence firms to partner with Indian companies and yield better returns on the investment. It will also encourage OEMs to bring in latest technologies to Indian partners which will further stimulate technological and manufacturing capability in the sector," Group chairman Atul Punj told IANS.

*We congratulate the government on finalizing a nuanced and optimal approach towards FDI in the Defence Sector and welcome the raising of FDI limit to 49 percent," SP Shukla, Member-Group Executive Board and President- Defence Sector & Group Strategy, Mahindra & Mahindra, told IANS in Mumbai.

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