Eight private firms cleared for defence contracts

Friday, 16 May 2003, 19:30 IST
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KOLKATA: India's defence ministry has identified eight private firms for producing military peripherals and spares for the armed forces, a senior official said Thursday. These companies will produce bulletproof jackets, avionics and other related equipment, Alok Perti, defence ministry joint secretary (Production and Supplies) told reporters here. After years of debate, the defence sector has been opened to the domestic private sector, with foreign direct investment (FDI) in this limited to 26 per cent. Letters of Intent (LoI) had been issued to the eight companies including Mahindra & Mahindra, Larsen & Toubro, Jindal, Max Aerospace and Aviation and Ramoss India. They were selected from a shortlist of 15 firms. Perti, speaking after a Confederation of Indian Industry (CII) meet, said the defence ministry would regularly monitor the products of the private firms. "The LoIs will be converted into licences once the companies begin production," Perti said adding that the partial opening up of the defence sector to private companies would mean greater opportunities for Indian industry. The Indian military's procurement budget during the current fiscal is 140 billion. Besides producing for the Indian defence establishment, the eight firms can also sell their wares to "other parties" after furnishing the details of the quantity and nature of products sold.
Source: IANS