- 29 Aug 2022
- ICICIdirect Research
MOD APPROVES INDIGENISATION OF 780 MORE DEFENCE COMPONENTS
News: In continuous pursuit of self-reliance in defence manufacturing and to minimise imports, Ministry of Defence (MoD) has approved the third Positive Indigenisation List (PIL) of 780 more strategically important line replacement units (LRUs), sub-systems, components with a timeline beyond which they will only be procured from the domestic industry. The list contains items/components used in major defence platforms like aircraft, helicopters, submarines, tanks, missiles, armoured vehicles, etc. With these 780 items, MoD has approved 1238 such items in the last eight to nine months (351 items in first list and 107 items in second list, which were notified in December 2021 and March 2022, respectively).
View: We believe that indigenisation of these components will benefit defence companies in terms of faster execution of major platforms led by procurement of these required items/components from domestic sources. As of now, 2667 such items have already been indigenised (163 items from first list, four items from second list and 2500 items before notifying first list); shows the government commitment towards indigenisation and reducing imports. Out of the 780 items, 360 are for aircraft and helicopters [manufactured by Hindustan Aeronautics (HAL)], 130 items are for submarines (manufactured by Mazagon Dock), 110 items for engines of armoured vehicles (manufactured by BEML) and others for ships, vessels, missiles, missile systems, tanks, radars, etc. Overall, the beneficiary defence companies would be HAL, Bharat Electronics, Bharat Dynamics, Mazagon Dock, Garden Reach and BEML.
Impact: Positive.