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which could cause harm to masses) which necessarily will require IL, delinking them
from offsets.
ASSOCHAM recommends a quick and speedy mechanism of renewal of licenses.
ASSOCHAM recommends that the current export procedure for Defence Products (a
significant part of which are governed by SCOMET guidelines) should be rationalized
with the population of category 6 of the SCOMET list
ASSOCHAM recommends that the DPP 2011 consider a higher FDI cap of 49%, subject
to approval by DIPP along with an automatic approval route for the 26% FDI limit. This
should allow for a significant degree of control by the Indian Government on the FDI
inflows while encouraging industry to seek meaningful foreign tie-ups.
ASSOCHAM recommends that The OEM should be allowed to modify offset projects,
valuations, and add additional offset partners after offset contract signature with the
concurrence of MOD
The Offset provisions contained in DPP-2011 and subsequent revisions of the DPP
should be retroactive to previous versions of DPP. This will make the defence offset
programs more executable for the foreign vendors and will enhance the benefits of
these programs for the Indian industry and the MoD. Helps provide increased flexibility
in execution within the confines of the DPP
The Offset Period of Performance should be determined independently of the main
contract. Allowing a longer period of time for the offset period of performance beyond
the main contract delivery period will result in enhanced business opportunities for the
Indian Offset Partners facilitated by longer term relationships with the foreign vendors
and their supplier partners.
Banking of Offsets has not yielded desired results because a large number of proposals
are pending without a decision since its introduction. A clause is recommended to be
added in the DPP stating that proposals will be deemed to be accepted by MoD, unless
instructions to the contrary are received by OEMs within three months of submission.
Banked offset credits should be transferrable between the vendor and any of its
subsidiaries, parent, affiliates, or sub-contractors.
ASSOCHAM recommends strengthening and reorganizing of DOFA to address the
impending offset volume. ASSOCHAM also recommends that this reorganization be
communicated to the OEMs and to the Indian industry at large through the MoD website
to avoid any confusion
Indias massive defence budget has the potential to make her a global manufacturing
and services hub in Defence. We must seize this opportunity and put in place a policy
regime that would facilitate investments (foreign and local), transfer of technology (ToT)
and creation of jobs in India.
The SEZ (Special Economic Zone) policy provides the ideal platform for this and
allowing 100% FDI for A&D manufacturing units located in SEZs would provide further
impetus to both indigenization and promoting India as a global hub.