Defence Minister A. K. Antony has shot down the Commerce Ministry’s proposal to raise foreign direct investment (FDI) in defence from 26 per cent to 49 per cent, saying it will be a ‘retrograde’ step and ‘stymie’ the growth of the domestic industry while increasing dependence on foreign manufacturers.
Mr. Antony has written a letter to Commerce Minister Anand Sharma, saying the FDI cap could not be raised as the country “cannot afford to be dependent on foreign companies and vulnerable to policies of their countries of origin” in the field of defence on the long-term basis.
“Allowing foreign companies to set up manufacturing/assembly facilities here would be a retrograde step as it will stymie the growth of indigenous design and development, and our dependence on foreign countries and OEMs for modern weapons will get perpetuated,” he wrote in the letter.
