It is imperative for Indian SMEs to integrate themselves into the supply chains of national and international defence majors to reduce dependence on foreign supplies and gain a foothold in the international market, Union MSME Minister Kalraj Mishra said today.

“India, till the recent past, relied heavily on foreign manufacturers for procurement of Defence-related equipment. However, there was always, a need for self-reliance. As we all know, small and medium enterprises (SMEs) play an important role in creating a self-reliant base for any industrial sector and that stands true for the Defence sector as well,” he said.

He added that the aerospace and defence industries are of strategic importance to any nation and India needs to increase self-reliance in this sector.

Mishra was speaking after inaugurating the fourth edition of ‘MSME DEFEXPO 2015’, organised by National Small Industries Corporation here.

According to the organisers, around 200 MSME exhibitors, including 10 international Original Equipment Manufacturers (OEMs) like Boeing, Airbus, Honeywell, Zen Air Defence Canada CEMILAC are participating in this exhibition.

“Our focus now is on enabling SME sector for the supply of equipment, machineries and general consumables,” Mishra said, adding that SMEs are crucial in the supply chain of high technology products and services related to defence sector, as SMEs “are real component of indigestion’s.”

A separate fund to provide necessary resources to SMEs to support innovation and R&D activities is also in place now, he pointed out.

Stating that SMEs have inherent strength for innovation despite their limited contribution to R&D activity, he said, “In sectors like aerospace, defence, aviation and home-land security industry, SMEs can contribute most to innovation because of low scale of economies and the high importance of knowledge.”

Noting that in India, a large number of SMEs serve as suppliers to defence PSUs but their contribution has somewhat gone unnoticed, he said. In order to achieve self-reliance in defence production and subsequently emerge as a significant defence player, India has to improve the competitiveness of its domestic SMEs.

Source: Business Standard