1. Government Policies

      • MoD has set itself a goal of sourcing 70% of all defence equipment from Indian companies – public, private and MSMEs - by 2020. This cannot be done without MSMEs playing a significant role.

      • The first-ever Defence Production Policy (DPP) released in January 2011 clearly articulates MoD’s agenda of supporting a domestic defence industrial base where a significant role for MSMEs has been envisaged.

      • According to the DPP, the MoD is setting up a separate fund to support research & development by Indian companies including MSMEs.

      • The recently announced new public procurement policy requires all central government ministries and public sector units to source at least 20% of their total annual purchases from MSMEs. Defence PSUs may also come under this rule, their purchases from MSMEs may shoot up.