UP DEFENCE CORRIDOR

India is the world’s largest military hardware importer and among top five military spenders. To meet growing modernisation needs of Indian Armed Forces, the Ministry of Defence will need to acquire equipment worth over $25,000 Crore by 2027. However, recent estimate shows that the current delivery capacity of the Defence industry sector in India is $7,500-8,000 Crore annually.

This means the ratio of indigenous to imported equipment is stagnating at 30:70. To achieve the aspirational target of manufacturing 70 per cent of Defence equipment indigenously, it is needed to incentivise private enterprise for development of large scale R&D and manufacturing capabilities. It is therefore necessary to increase the production level of Defence Manufacturing Units and establish new units for defence manufacturing to cater to the growing need of Defence Sector of India. We can also reverse the flow of trade : from being the largest importer of defence items to become the largest exporter of defence goods as well.

So to provide the needed thrust to the Defence Manufacturing in India the Hon’ble Union Finance Minister Mr Arun Jaitley announced setting up of two Defence Industrial Corridors in the country through his budget speech on February 1st 2018.

Thereafter, Hon’ble Prime Minister Mr Narendra Modi during U.P. Investors Summit 2018 held in Lucknow on 21st February announced setting up of Defence Industrial Corridor in Bundelkhand region of Uttar Pradesh. The second Defence Corridor is being set up between Chennai and Bengaluru.

As per the announcement of Defence Production Corridor in U.P. (Bundelkhand) it was proclaimed by the Government to provide all the needed support and assistance to defence manufacturing units through different policies and incentives for active participation in Defence Production in India.

UP Aerospace and Defence Manufacturing Policy 2018 is projected to spur investment of Rs. 500 billion and generate 2,50,000 jobs by 2023 in the proposed UP Defence Production Corridor.

The Uttar Pradesh Expressways Industrial Development Authority (UPEIDA), the nodal agency for the project, has identified more than 5,000 hectares of land for the corridor in six districts where farmers will be compensated at four times the circle rate. At least 40 more companies have also approached the state government officials said. The Defence Manufacturing unit would be offered land on plug and play model.

IIT Kanpur has agreed to set up a centre of excellence for the proposed defence corridor. The primary areas of collaboration between UP government and the institute will be advanced nanomaterials, cybersecurity and electronics as well as communications.

Taking these things in consideration IIA is working on its very best to act as a facilitator for the Defence Manufacturing Establishments in order to make them understand the current scenario of Indian Defence System and the soaring business opportunities in defence manufacturing and supply – augmented emphatically after the announcement of the UP Defence Corridor . IIA is also providing all the needed support to the Defence Ministry of India and UP Govt for ensuring noteworthy and progressive involvement of the industries from Uttar Pradesh in the UP Defence Production Corridor Project.

Department of Defence Production – Ministry of Defence (MoD), Govt. of India entrusted Indian Industries Association (IIA) to organise Consultative Industry Meets on “U.P Defence Corridor” at Agra, Lucknow and Kanpur for direct interaction with the MSME Entrepreneurs of Uttar Pradesh. These Industry Interactive Meets were successfully organised by IIA with the active involvement & support of Department of Industrial Development Govt. of U.P on 8th, 9th and 14th May 2018 at Agra, Lucknow & Kanpur respectively. All the three meetings were highly successful and were attended by more than 600 delegates including more than 450 MSME Entrepreneurs.

IIA was the co-organiser of the Aligarh Defence Conference and Exhibition held on 11th August 2018 at Hotel Royal Residency, Aligarh.

After organising these events IIA is in regular discussion with the UP Govt. and Ministry of Defence, Govt. of India to channelize the efforts being made for inviting the potential investors for the UP Defence Corridor Project and provide the needed thrust to the defence manufacturing entities to establish their production unit in the defence corridor and avail the benefits and subsidies being provided by the State as well as Central Government.