On Saturday, Finance Minister Nirmala Sitharaman stated the FDI limit in defence production will be raised to 74% from 49% for FDI through the automatic route.
“The FDI limit in the defence manufacturing under automatic route has now been raised from 49% to 74%. This decision will unleash the true potential of Indian defence production capabilities through ‘Make in India’. The announcements made today will prove to be a Game Changer,” said Rajnath Singh, defense minister of India.
The reforms include imposing ban on importing certain weapons and corporatization of defence ordinance factories.
The finance ministry announced to notify a list of weapons or platforms that will be banned for imports with year-wise timelines. This would mean that India will have to compulsorily develop technology for those defence systems/platforms.