The world’s second largest importer of military equipment is getting serious about becoming a global exporter of defence goods.
India—which imported Rs36,900 crore ($5.57 billion) worth of arms, ammunition and related goods last year—has taken the first step to align its defence export programme with the Wassenaar Arrangement, a multinational agreement between 41 countries that controls the exports of certain conventional arms and military technologies. India’s defence exports are currently worth less than 2% of the military equipment it imports.
On Aug.17, India’s defence ministry unveiled a list comprising 16 categories for defence export equipment. These include armoured vehicles, ammunition, rifles and small arms, military training equipment, electronic warfare devices, software, bombs and torpedoes.
According to the Wassenaar Arrangement, member countries maintain export controls on listed items and report on transfers and denials of specific controlled items to destinations outside the arrangement. They also exchange information on technology.
“This is one step before being part of the Wassenaar Arrangement,” Laxman Kumar Behera, a research fellow at New Delhi’s Institute for Defence Studies and Analyses, told Quartz. “The list helps identify items that can be controlled by the government and brings about clarity to the private sector who are focussed on exports. This is also part of the larger ‘Make in India’ plan to promote defence production.”
“There was so much confusion about defence equipment before,” Dhiraj Mathur, executive director at PwC, said. “For the private companies who are keen on manufacturing in India, this list gives them the much-needed clarity and improves the ease of business. It also tells them clearly about the items that could be manufactured and if they are allowed foreign direct investment (FDI).”
India hopes to join the agreement later this year to give its defence export regime a boost. The Wassenaar Arrangement is one of the four multilateral regimes—apart from Nuclear Suppliers Group, Missile Technology Control Regime and Australia Group—that India wants to be part of.
Although a massive importer of arms, India is keen on growing its defence exports. In September 2014, a few months after Narendra Modi took charge as India’s prime minister, the country launched a new defence export strategy, in line with the “Make in India” campaign to boost defence manufacturing in the country.
India’s defence exports in 2015 stood at Rs670 crore ($100 million), according to research firm IHS Jane’s, in stark contrast to the huge amount of military equipment that it imports.
Last year, India’s defence exports ranged from avionics kits to helicopters, sent to countries including Afghanistan, Ecuador, Oman, Singapore and Namibia.