74 pc FDI in defence not DIPP view, says Sharma | business | Hindustan Times
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74 pc FDI in defence not DIPP view, says Sharma

business Updated: Jun 13, 2010 16:20 IST

Commerce and Industry Minister Anand Sharma has said that 74 per cent FDI in defence production, flagged in the concept paper of his ministry, cannot be taken as its "view", because the issue is open for national debate.

"Let me (make it) clear that it is not a DIPP (Department of Industrial Policy and Promotion) view. It is a discussion paper," Sharma told PTI.

The DIPP, under his charge, had said in the discussion paper on May 17 that for the country to have state-of-the-art technology, "we have to permit anything above 50 per cent, if not 100 per cent." It had even said that 100 per cent FDI would be desirable.

The minister said that the decision on hiking foreign direct investment in the defence sector would be taken "only after taking on board the views of the defence establishment."

Under the present policy, 26 per cent FDI is allowed in defence. Industry chambers like CII and Assocham have suggested that the cap be revised to 49 per cent.

The defence establishment has so far been opposing any hike beyond the 26 per cent threshold. However, it is willing for case-to-case permission up to 49 per cent, as in the case of the Indo-Russia joint venture for BrahMos missile production.

Sharma said the discussion paper has been floated to have a "nationwide debate, where all the stakeholders, industry, civil society or defence establishments give their views."

However, in line with the DIPP paper, the minister underscored the need for India to become a global leader in technology development and innovation.

"We are very clear that we need to be more innovative and forward-looking when it comes to defence production," he said.