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Press Information Bureau
Government of India
Ministry of Defence
05-February-2018 16:37 IST
Manufacture of Ammunition by Private Sectors

The Government has approved a proposal for manufacturing of selected ammunition for Indian Army by Indian Industry.  Request For Proposal (RFP) for the same have already been issued.

The Defence Production Policy promulgated by the Government, aims at achieving substantive self-reliance in the design, development and production of equipment, weapon systems & platforms required for defence.  It also aims at creating conditions conducive for private industry to play an active role in the sector, enhancing the potential of Small & Medium Enterprises (SMEs) in indigenisation and broadening the defence Research & Development base in the country.  In pursuance of this policy and ‘Make in India’ initiative, the Government has undertaken several measures which, inter-alia, include:-

  • Introduction of a new category of capital acquisition viz. ‘Buy (Indian-IDDM)’ in Defence Procurement Procedure (DPP-2016).  Under this category, indigenously designed equipment with minimum of 40% Indigenous Content (IC), or equipment with 60% IC will be considered for acquisition.  This category will be the most preferred acquisition category and above the ‘Buy (Indian)’ category.  Under ‘Buy (Indian)’ category minimum IC of 40% is required and under ‘Buy & Make (Indian)’ category a minimum IC of 50% will be required in ‘Make’ portion of the scheme.  The ‘Make’ Procedure has been refined to ensure increased participation of Indian industry.
  • Industrial licensing with respect to Defence sector has been revised and most of the components, parts, sub-systems, testing equipment and production equipment have been removed from the Defence Products List for the purpose of Industrial Licenses so as to remove entry barriers for industry, particularly with respect to small & medium segments.
  • Under the new FDI policy, foreign investment up to 49% through automatic route and beyond 49% through Government route has been allowed in the Defence sector.
  • Creation of level playing field between public sector and Indian private sector with regard to Exchange Rate Variation protection and levy of Excise and Customs duty.
  • Incorporation of a Policy on Strategic Partnerships in the Defence Sector in DPP-2016 intending to institutionalise a transparent, objective and functional mechanism to encourage broader participation of the private sector, in addition to Defence PSUs and Ordnance Factory Board (OFB).

The indigenous production in terms of Value of Production (VoP) in respect of OFB and Defence PSUs during the last three financial years are as under:-


Value of Production

(Rs. in Crore)









This information was given by RakshaRajyaMantriDr.SubhashBhamre in a written reply to Shri Harivanshin Rajya Sabha today.