New set of conditions for defence procurement stipulate foreign firms to support development of Indian capabilities by way of technology transfer and local procurement. In this context, lessons learned in implementing Phased Manufacturing Programme by DGTD prior to liberalisation could still be relevant:
- Technology transfer is a commercial decision involving two private firms and for government wishes/ contracts to be enforced, liberal funding support need to be provided simultaneously to Indian firms to take up R&D projects to develop technology absorption capacity.
- Innovation is driven by demand and defence needs to give a fair opportunity to Indian firms by giving out long term (10-15 years) development contracts.
- Do away with pre-approved (budget) funds for DRDO, let all funds flow thru developmental contracts from Defence.