India needs to build a military industrial complex by enlisting large and medium cluster of industries, said BrahMos Aerospace founder Dr. A Sivathanu Pillai at the Deftronics 2014 in Bangalore.
Addressing the event organised by India Electronics and Semiconductors Association (IESA), Dr. Pillai pushed for a stronger public and private partnership to advance the defence sector in view of the rapidly growing electronic system and design and manufacturing (ESDM) ecosystem in aerospace and defence.
IESA, along with PwC, has released a report stating that India's defence budget has grown to ?224k crores, with 40 per cent of it allocated to capital spends, and this may grow to ?137k-?154k by 2018. With the growth in demand, Electronic Manufacturing Services organisations are expected to provide employment to more than 200,000 skilled and semi-skilled workers by 2015.
The report has also indicated India's plans to achieve 50 per cent of demand for high impact products through high-value added manufacturing, which will also boost the growth of the country's defence sector.
Dr. Pillai said the scenario of warfare had changed from the use of weapons to electronic and cyber warfare. In the future, computer intelligence will gain more importance, and the use of electronic components would be more than 70 per cent. Therefore, India must capitalise on this, while players in the defence sector need to step up their role.
The noted scientist said the country needed to export more and rely less on imports, since the world is now entering the "hypersonic era." This is expected to pour in $150 billion investments, giving more opportunities to local companies.
"Today, a huge portion of India's defence budget goes towards making payments for equipment imports," Defence Minister Arun Jaitley said during the event. "A thriving local industry will address this imbalance and also create many jobs in both manufacturing and engineering services."
He also noted that India is uniquely poised to build a local defence industry that could cater to its domestic needs and export demands. "Our relatively lower cost of manufacturing, in addition to an expanding pool of skilled workers, makes India an attractive global destination."
