Context: Recently, the domestic small arms manufacturers have expressed their concern over continuing imports of small arms by the Government of India.
Background

• Indian Army has decided to buy 72,000 Sig Sauer assault rifles for its troops from the United States.
• The new assault rifles will gradually replace the flaw-ridden 5.56 mm INSAS (Indian Small Arms System) rifles.
• The rifles are currently being used by US forces as well as several other European countries.

Key Points

• The Army has been attempting to replace the indigenous INSAS (Indian National Small Arms System) rifles with a modern rifle.
• In the last few years, several Indian companies have invested in the small arms segment, given the large requirement and efforts by government to open up ammunition to the private sector and have started production as well.
• However, without any major order from the armed forces, many companies are looking for smaller orders from police and Central Armed Police Forces (CAPF).

Concerns

• Companies would have invested crores of rupees with the hope of business and contract from the Government, but today they are staring at an uncertain future.
• If the domestic industries are not given a chance, it will only undermine the Make in India initiative and companies may shut their operations.

Military budget of India

• In the 2020 budget – the allocation for defence during the fiscal year 2020-21 stood at more than Rs. 470 thousand crores, this amounted to an increase of just below 7%.
• The Indian Army accounts for more than half of the total defence budget of India, with most of the expenditure going to the maintenance of cantonments, salaries and pensions, instead of critical arms and ammunition.
• It may be seen from data of economic survey that Defence Budget as a percentage of GDP may appear to be decreasing due to increasing trend in the growth of GDP. However, it is increasing in absolute terms, implying higher spending.

India’s Defence Imports

• India was the world’s second-largest arms importer from 2014-18, ceding the long-held tag as largest importer to Saudi Arabia, which accounted for 12% of the total imports during the period.
• However, Indian imports decreased by 24% between 2009-13 and 2014-18, partly due to delays in deliveries of arms produced under licence from foreign suppliers, such as combat aircraft ordered from Russia in 2001 and submarines ordered from France in 2008.
• Russia accounted for 58% of Indian arms imports in 2014–18, compared with 76% in 2009-13.

Road Ahead

• By supporting its domestic manufactures, India can become the centre of excellence in the small arms sector. It will also reduce the import dependence of arms and ammunition.
• Promoting domestic manufacturing of small arms, is in line with the government’s Atma Nirbhar (self reliance) Bharat push.
• Domestic manufacturing of arms will also create jobs for Indians.