How to build defence capabilities

There has been considerable discussion about India’s defence industry, including the ongoing debate in Parliament over the purchase of Rafale aircraft, connected offsets and the technical capability of our leading defence PSUs. It is a sad commentary that even 70 years after attaining independence, India is incapable of designing and developing its own MMRCA, and there are doubts whether its premier aerospace company — HAL — is capable of manufacturing these aircraft under transfer of technology. This holds good for most other defence PSUs which may be required to manufacture other complex weapon systems.

Clearly, over the past seven decades, India has failed to put in place a robust defence industrial base capable of meeting the challenges of the 21st century. With the cost of imported weapon systems increasing prohibitively, we can no longer afford to acquire such systems from foreign states/companies that require a steady increase in defence budgets. The country has to move beyond being a licensed weapons producer and must rapidly acquire the capabilities and capacities to design and develop weapon systems that meet its requirement and are globally competitive. 

Among the challenges that arise in setting up a modern defence industrial base, three factors stand out. First and foremost is the requirement to have a large reservoir of research talent in advanced technology disciplines. Without sustained availability of a quality technology base, no country can be globally competitive in the defence sector. Sadly, India lacks advanced technology human resources capable of quality research work. A recent report by Clarivate Analytics that lists 4000 of the world’s most influential researches is most depressing. Only 10 Indians are mentioned in the list (the US tops with 2639, UK has 546 and China 482).

While there are many reasons for this poor performance, one of the most important aspects that promote a deeper understanding of the research work required for complex weapon systems is systems sciences, or systems engineering. This crucial aspect of technological competence is missing from the syllabi of our IITs and engineering colleges. Most leaders and programme managers of high-end technology projects are graduates of systems engineering (MSc/equivalent), while in India, our scientists tend to learn on the job, leading to time and cost over-runs and poor quality.  The country needs tens of thousands of systems engineers if we aspire to be self-contained in our research for design and development of weapon systems.

The second attribute of a defence industrial base is a high-end technology infrastructure that enables research work for design and development. To be fair, at the time of Independence, India had no defence infrastructure in place, strange for a country that had a robust defence manufacturing capability even in the 16th century. The Mughals developed advanced capabilities for manufacture of heavy and light cannon, and the Marathas set up a thriving ship-building industry towards the end of the 17th century. During British rule, this manufacturing capability was suppressed and later demolished.

A concerted effort was put in place in the 1950s and 1960s to set up capacities for research and manufacturing through the creation of the DRDO, Ordnance Factories and Defence PSUs. Crucially, the private sector was ignored, a grave mistake that even 70 years later the country is struggling to rectify. In later years, no effort was made to modernise this infrastructure to respond to the challenge of the 21st century. The result: The weapon systems produced in the country have failed to satisfy our own armed forces, leave alone attracting global attention for exports.

The third and most important requisite for a defence industrial base is the presence of an R&D system that is self-sustaining and economically rewarding. The current system of a state-controlled and monopolistic R&D stifles motivation and is a constant drag on the need for innovation and modernisation of systems and procedures. Up to the end of the Second World War, most defence R&D was state-funded and high-end defence technologies enabled a wide variety of civilian technologies to ride piggyback, especially in the fields of aerospace, electronics and telecommunication. Today the roles have been reversed, with defence technologies borrowing heavily from advances made in the industrial sector. The technologies of today contained in a cell phone may well be used to provide a vital function in a missile system. 

By definition, a defence industrial and technological base incorporates the industrial and technological assets of a country that are of direct or indirect importance for the production of defence equipment and war-fighting capability. It is obvious therefore that the defence sector's needs should be coordinated with other technology-intensive fields such as space, civil aviation, telecommunication, electronics, atomic energy and ship-building. The Indian defence industry must shift its current R&D, which is focused on a “product strategy”, to a broader investment and focus on a “capability strategy” around the various disciplines that comprise the defence industrial base.

At a conservative estimate, India imports over $50 billion worth of telecom and electronics products every year. A broader engagement and investment in R&D projects will enable economies of scale, reduce financial risk in R&D and incentivise private sector participation in the design and development of weapon systems required by our armed forces. This R&D model, also known as “convergence strategy” for its union of technology in defence and industry, is a vital requirement to respond to the wide range of technology applications in the 21st century.

The three attributes of a defence industrial base are connected and heavily dependent on each other. A sustained availability of skilled researchers with access to modern and high-end infrastructure can be harnessed to work on a convergence strategy of R&D that is globally competitive. To achieve this, India needs to lay out a roadmap with clear-cut executive action plans for implementation, to ensure that in 10 years we have an adequate pool of quality research scientists and systems engineers, modernised infrastructure through the setting up of research institutes in collaboration with the private sector, and an entrepreneurial system of R&D in place based on a convergence strategy. A frank and open debate in Parliament is needed and a political consensus arrived at to provide continuity to the implementation of the programme of modernising our defence industrial and technology base.   

The writer is Managing Director,  Firmbase Consulting, a defence consulting company 

Business Standard is now on Telegram.
For insightful reports and views on business, markets, politics and other issues, subscribe to our official Telegram channel