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BW Businessworld

Time To Step Up Defence Innovation & Modernization; Services Must Be The Primary Driving Force Behind All Defence R&D

Modernization is an inescapable and inexorable need of the defence forces in India. The thrust on technology and innovation is an imperative for both the establishment and industry. Instead of adopting a lead role in technological innovation in drone and anti- drone capability by virtue of the available expertise in IT, the country scrambled to hastily acquire even basic equipment. In the face of each crisis, the Armed Forces end up looking far and beyond and yet again initiate a complex cycle of procurement with Original Equipment Manufacturers (OEM), mostly foreign. What is the way out then? The Indian Armed Forces must step into the role of the soldiers- scientist, taking ownership of the weaponry and technology that they depend on, to defend our country, writes Manish Kumar Jha.

Photo Credit :


BW Businessworld (Cover Issue is Published in the Print Edition (19 July-02 August ) includes the special interaction with COAS)

DEFENCE MODERNIZATION IN INDIA has traditionally been prompted by the exigencies of national security. While the security of the nation is still the core concern, modernization of the defence forces is being driven by a goal to build long-term strategic capability through the acquisition of new-age technology and equipment. Driven by innovation though it is, the modernization of defence equipment in India does not always seem to be in step with the security exigences the armed forces have to grapple with. The recent drone attack at the Indian Airforce (IAF) base in Jammu highlighted this lack of preparedness and the inadequacy of the process of research and develop­ment (R&D) and innovation.

The fallout of the state of affairs has been a mix of hasty acquisition of expensive technology and clumsy prototyping of under-developed solutions. Instead of adopting a lead role in technological innovation in drone and anti- drone capability by virtue of the available expertise, the country scrambled to hastily acquire even basic equipment. 

The defence moderni­zation space, collectively has seen much action on the policy front, but little on the acquisition front. It is obvious that some changes in the Defence Acquisition Procedure (DAP) 2020 are poised to support indigenization under the ‘domestic purchase clause’ – a commendable policy inclusion – leading to far-reaching gains for the domestic defence industry. 

The problem that surfaces periodically is the actual development of such equipment and the lack of accountability of the R&D framework. 

In the face of each crisis, the Armed Forces end up looking far and beyond and yet again initiate a complex cycle of procurement with Original Equipment Manufacturers (OEM), mostly foreign. What is the way out then? The Indian Armed Forces must step into the role of the soldiers’ scientist, taking ownership of the weaponry and technology that they depend on, to defend our country.


The Indian Army (IA) has been historically in favour of medium and heavyweight tanks. At the same time there is absence of a consequential or at least, a basically signifi­cant light-tank component in its armoured corps. The ongoing India-China standoff at the line of actual control (LAC) in Ladakh has highlighted the need of a light tank for high altitude mobility.

In an exclusive interaction with BW Businessworld, Army Chief, General M. M. Naravane, highlighted the importance of the light tank. He said, “It could also fill the vacuum of the medium weight tank with greater firepower.”

But broadly speaking, the Indian Army’s moderni­zation plan rests on two critical projects, the Future Ready Combat Vehicle (FRCV) and Future Infantry Combat Vehicle (FICV).

Indian Army Chief General M.M. Naravane 

The delay in procuring these critical future capability enablers for the Indian Army is as much about the capital as the conflicts within it over the qualitative requirements. The lack of complementary defence budgeting, disregard for reforms in the higher echelons of defence organizations, procurement stalemates and bureaucratic decision paralysis have impeded the path to defence capability enhancement. 

Lt. Gen. R. K. Jagga, who was the Director General of the Mechanized Forces (DGMF) of the Indian Army, talks about the need for such equipment. “Light tank is needed on our northern front for both tactical and operational mobility. However, with modern technology, we can meet all three parameters of Firepower, Mobility and Protection by having a light tank whose weight is between 25 to 30 tonnes.”

While this should be something that should ideally have been long deliverd by the Ordnance Factory Board (OFB), it is public knowledge that the institution has failed in its primary objective. The recent corporatization of the OFB – which has often been described as the ‘the elephant in the room’ – speaks volumes about its hitherto dysfunctional nature.


The FICV is a time critical replacement of the obsolete 2610 BMP II (procured in the mid-1980) which began its turbulent journey through an AON (Acceptance of Necessity) in October 2009, under DPP 2008, Make Chapter. Since 2009, the FICV project has already been launched twice through an Expression of Interest (EoI) in 2010 and another one in 2015. The last EoI of July 2015 was evaluated in an objective, transparent and fair manner and submitted after the tedious evaluation by the IPMT, for approval in November 2016. 

The impasse commenced with the same MoD office who had approved the EoI evaluation criteria, raising con­cerns about its approved parameters and weightages, at a stage when results were placed on file. The case was ulti­mately referred to a panel of Independent Expert Monitors (IEMs) by the MoD, who found the EoI evaluation to be up to the mark. The deci­sion paralysis has now extended to budgetary allocation for development cost to two private industry players, which was then to be funded 80 per cent by the government and 20 per cent under DPP 2008.

(Universal combat weapon platform concept by DRDO)

Later to save on the initial cost of development it was placed under Make 2 of the Defence Procurement Procedure (DPP) 2016, which refers to full private fund­ing. Now the cycle of delays have cost FICV a full decade and more at the concept stage itself, meaning that even if the FICV does get the final nod now, the fleet replacement will be complete, at the earliest by 2040.

A detailed analysis of SP (Strategic Partnership) Model, Make1 and Make 2 for FICV clearly weighs the balance in favour of progressing FICV under Make 1, in terms of time sensitivity, life cycle management, technology induction and indigenisation. The progress under Make 1 will also have the effect of invigorating the otherwise sluggish defence ecosystem.

Chief of Army Staff (COAS) General Manoj Mukund Naravane says, “The Army is making efforts to push its ten- year-old plan to acquire 2,600 future infantry combat vehicles for the Indian Army at a cost of around Rs 60,000 crore by 2026-27 and have held interactions with stakeholders on progressing the procurement case expeditiously.” 

A fresh RFI has already been prepared and is likely to be released to the industry soon. Tata Motors, L&T, Mahindra, Reliance Defence are some private firms that have shown interest in the development of FICV for the Indian Army. Tata Motors and L&T are the only two pri­vate firms to have developed prototypes of the FICV.

The FICV will be a Fully Tracked Vehicle which will be capable of operating in any type of rough terrain with Fully Amphibious capabilities. The FICV will be Transportable by in service C-17/I-76 aircraft by road or by rail. It can be armed with the Main Gun, ATGM, Medium Machine Gun (MMG), Smoke Grenade Launcher, Automatic Grenade Launcher and other offensive weapons.


The Ordnance Factory Board in collaboration with the DRDO, is developing a futuristic infantry combat vehicle (FICV) for the Army, which is likely to see the light of day in a three-to-five year timeframe. At present, the OFB manu­factures infantry personnel carrier with a 30 mm gun - the BMP II. An official from DRDO said, “Depending upon interaction with Army officials, when the product comes to an acceptable stage and the Army gives its nod, production will start. It will be tentatively named Mark I. While Mark I of FICV is expected in three to five years, Mark II may be visible on the horizon in five to ten years.”

(Future threat scenario for the battlefield)

The FICV will have enhanced firepower such as an auto grenade launcher with a range of 1,500 metres and anti-tank guided missile capability, which launches missiles at a range of 4,000 metres, backed by an automated command system. The new FICV comes equipped with a gun system with a thermal imager fire control system con­taining advanced gunner and commander sights. It is also equipped with NATO STANAG Level 4 protection against heavy machine gunfire at the sides and its enhanced mobility enables speeds of up to 80 km per hour.

The new FICV will now be equipped with a hydro jet propel­ler system that enables it to travel at 10 km per hour in static water. The modern suspension system allows fire on the go. The OFB, Medak, had in the past developed Abhay IFV, which was based on the Soviet-era BMP-2 Infantry Combat Vehicle but did not find much favour with the Indian Army. According to the OFB, the new FICV which has been designed and developed by OFB Medak, has already gone through internal developmental trials, including weapons trials of its main gun along with ATGM fir­ing. However, apart from this ini­tial progress, there is little within the vision of the OFB at the moment.


India so far has had a varied port­folio of tanks: T72M1 Ajeya main battle tanks (MBTs), T90S Bhishma platforms, along with 124 indigenous Arjun Mk1 MBTs. Earlier this year, on 1 June, the Army sent out RFI’s to OEMs for its planned acquisition of 1,770 medium weight Future Ready Combat Vehicle’s by 2030 at a yet undefined cost. No other army in the world has as many tanks. The question naturally is what the strategy behind this is?

In an exclusive interview with BW Businessworld, the Army Chief clarified, “We don’t have many types of tanks. T-72s and T-90s belong to the same family. We envisage their deployment to continue for the next ten years and our RFIs underline the essence of our long-term requirements. At this time our focus is on FRCV. We need a diverse range of tanks as one type doesn’t fit in all terrains.”

The FRCV will form the base platform for the main battle tank and its variants and will replace the existing T-72 tanks, which have been in service since the 1980s. The Main Battle Tank – FRCV being the forerunner, it will pave the way subsequently for a family of supporting plat­forms, based on a modular approach and base platform standardization. The Indian Army is set to finally place an order for 118 indigenously man­ufactured Arjun Mark 1A ‘Hunter Killers’. The Mark 1A weighs 68 tonnes and features a 120 mm main gun which has been developed by DRDO’s Chennai-based Combat Vehicles Research and Development Establishment (CVRDE).

THE ARJUN MBT MARK 1A: The third element in the artillery modernization is the MBT, with an improved gun­ner’s main sight, integrated with automatic target tracking. The gun is controlled via a comput­erized integrated fire control system. The gun’s day-and-night stabilized sights, coupled with automatic target tracker, guarantee accurate engagement even in dynamic conditions. Other than conventional fin sta­bilised armour piercing discard­ing sabot and high explosive squash head ammunition, the Mark 1A also comes with thermobaric and penetration-cum-blast ammunition.

But this is not what the Indian Army is looking for in its heavy tanks. It needs the much lighter 40-45 tonne tank, compared with over 60 tonnes. While the Arjun Mk 1A has seen a 118-unit order and Arjun Mk 2 is also under consid­eration, the Army does not seem interested in buying any more. The Army talks about the mismatch of the require­ment and role of the MBT Arjun. The DRDO is also taking up issue with the MoD under the Make in India initiative and pushing the Army to order more. The Indian Army on the other hand, is looking for best-in-the-world design ele­ments in line with the lightweight- high mobility concept of FRCV. The Army says, “Let all compete even Indian’s main MBT Arjun 2 and then we will decide.”

According to the Army Chief, “The Request for Information was uploaded in November 2017 with the date of submission of 30 June, 2018. We have received responses of four OEMs for the complete platforms. The process for ratification of Qualitative Requirements for the FRCV is currently under progress. The FRCV project is progressing as per the guidelines of the Strategic Partnership Model. Including the family of variants such as lighter tanks, the total number of vehicles to be manu­factured under this project is over 2,600.

(Future Tank Concept DRDO)

The RFI responders are South Korea’s Hyundai Rotem; UK’s Bae System; the US’s General Dynamics; Germany’s Krauss-Maffei Wegmann; Russia’s Rosoboronexport Export; Ukraine’s Ukrainexport and Poland’s Polski Holding Obronny. Indian private players who will form joint ventures with OEMs include the Mahindra Group, Bharat Forge, Punj Lloyd, Tata, Reliance Defence and Engineering Limited, Titagarh wagons.


Finally, the long overdue reforms have started to take shape but what has been done is too little to bring about any drastic change. The Ministry of Defence notified on 16 June that there is no proposal to privat­ize Defence Public Sector Undertakings (DPSUs) and the Ordnance Factory Board under the administrative control of the Department of Defence Production.

However, to enhance functional autonomy, efficiency and unleash new growth potential and innovation in ord­nance factories, the Cabinet Committee on Security (CCS) in its meeting, approved the conversion of the production units of OFB into seven DPSUs. However, the fact remains that the Indian Army’s artillery modernization will remain a pipe dream unless the OFB takes a leap forward and invests in new technology and replaces its archaic factory assembly lines with modern equipment. Corporatization of the OFB is just not sufficient. What is needed is a com­plete overhaul. Why not call for disinvestment?

Ordnance Factory (OFB)'s Archaic Assembly Line needs overhaul

It seems to be a wait-and-watch situation, although based on discussions with analysts, the picture looks bleak. The Army Chief has pointed out that the mantra for mod­ernisation is ‘Modernisation through Indigensation’. While critical requirements have been progressed through import, primarily due to lack of indigenous capability, our focus has always been indigenisation. But this is not the case on the ground. The OFB is not even remotely close to completing the projects, as in the case of the ready-to- fire prototype gun. The DRDO is on the job, but there remains ambiguity. The DRDO‘s Chairman G. Satheesh Reddy, informed this writer of the development of the light tank for high altitudes. But that remains to be seen. The OFB has not issued any statement in this regard. Defence experts have opinioned that the OFB needs a complete restructuring and overhaul, beginning with investment in Industry 4.0 technologies in areas of Manufacturing, Supply Chain and other broader digital transformation initiatives.

The OFB needs to focus on the emerging areas of Artificial Intelligence, Data Fusion, Web Technologies, Data Analytics, 3D Printing, Networking and Cybersecurity. Its archaic assembly lines consist of World War II technology even as globally, new technologies are being incorporated into products and systems at the design stage itself. Another important aspect is the change in the traditional ToT based manufacturing approach to a more proactive co-development and co-production approach. 

India’s Defence Secretary Ajay Kumar favours such coop­eration in bringing greater efficacy. He was instru­mental in launching the indigenization portal - SRIJAN in August 2020 for DPSUs, the OFB and the services with an industry interface to provide development support to MSMEs and startups for import substitution. He said, “So far more than 10,945 defence items, which were earlier imported, have been displayed on the portal. Private industry has expressed interest in indigenising more than 2400 items.” The extent to which industry takes advantage of such initiatives is yet to be seen.

“What is lacking is regular interaction meetings between the DRDO and users,” said a senior commander, adding, ‘It happens for specific requirements and issues only.”

“How the new set-up will change the pattern is yet to be seen. The DRDO, OFB, DPSUs and the Armed Forces being part of the same ministry, they should ideally regu­larly interact with one another for design, development and production of defence equipment, based on the requirements of the Defence Forces,” said Maj. Gen. S. Asthana (Retd) who has worked very closely with the OFB.

It will be important to focus on modernization of pro­duction facilities through higher capital expenditure. The question is: will the OFB’s corporatization drive such a change? If the answer is no, then disinvestment is the ulti­mate solution.


The most crucial aspect of defence manufacturing in the context of India is the ability to initiate R&D and develop prototypes. This has been the area where government took total control of under the banner of national security. The recent policy announcement in this domain has been around the iDEX and StartUp fund.

An innovation ecosystem for Defence under the name Innovations for Defence Excellence (iDEX) was launched in April 2018. iDEX is aimed at the creation of an ecosystem to foster innovation and technology development in Defence and Aerospace by engaging industry, including MSMEs, Start-ups, Individual Innovators, R&D institutes and Academia, and provide them grants and funding as well as other necessary support to carry out R&D which has potential for future adoption for Indian defence and aerospace needs.

Innovations for Defence Excellence (iDEX) has been given budgetary support of Rs. 498.80 crore for the next 5 years from 2021-22 to 2025-26. The objective of the scheme is to provide financial support to nearly 300 Startups, MSME and individual innovators as well as about 20 partner incubators through the Defence Innovation Organisation (DIO). 

What difference can this make for this nascent industry? L&T’s Jayant Patil who led the project K-9 Vajra understands the need for massive investment at the development stage of equipment. On the innovation aspect and contribution from the government, he points out the insufficient support, he said: 

"The policy directives currently in vogue for promulgating R&D efforts in the private defence industry comprise of only two major initiatives, namely the iDEX and Technology Demonstration Fund. iDEX strives to promote innovation and R&D for smaller solution offerings and amongst startups with a maximum cap of Rs. 1.5Cr per initiative and the entire funding being around Rs. 500 Cr only.”

Indigenous effort --Swarms of Drone ( Displayed by Indian Army )

The Defence Acquisition Policy on the other hand provides a framework for enabling funding for Private Sector through its Make-I Category of acquisitions where up to 90% of the prototype funding would be released in a phase manner. 

“Despite multiple acquisition cases being initiated under this category, not even a single one has taken off as on date, however the MoD leadership has recently assured at least five Make-I programs to be awarded every year here-onwards,’’ points out Patil. 

The best way out is what is suggested by Lt Gen (Dr) R S Panwar who developed the “Data Concentrator” during his stint at IIT Mumbai and transferred this sophisticated tech to Bharat Electronics. He calls for a pivotal role of military in the R&D laboratories, besides providing boots on the ground.  The premise has always been that the DRDO and Industry, with the MoD in the lead, are solely responsible for the poor performance of our DSTI sector, with the role of the Defence Services being restricted to drawing up QRs and projecting demands. 

However, Gen Panwar believes that the Services need to be the primary driving force behind all defence R&D, with the DRDO and certain new organizational structures like a Defence Innovation Unit (DIU) and Indian-DARPA being placed under military control.  

Such an enhanced role with military “soldier scientist” at the helm, which would make the Armed Forces directly accountable for the performance of the DSTI sector, is quite at variance with the existing views of our military leadership.

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Indian Army Chief with BW Businessworld (Cover Issue is Published in the Print Edition (19 July-02 August ) includes the special interaction with COAS)