American defence firms that have offered to set up production lines in India have now sought assurances from the Indian defence minister that they will still get to keep their proprietary technology, Reuters reported on Tuesday.
In a letter to the Indian defence minister dated August 3, the United States-India Business Council has said that these firms also do not want to be held liable for any defects in the products that would be manufactured in collaboration with Indian partners as part of the Make in India initiative.
“We recommend the Ministry of Defence affirm that foreign OEMs [original equipment manufacturers] will not be liable for defects outside their company’s control,” the group said.
The Make in India initiative was launched by Prime Minister Narendra Modi in September 2014 to create jobs in the country and make India a global manufacturing hub by easing processes to do business in the country.
“Control of proprietary technologies is a major consideration for all companies exploring public and private defence partnerships,” the business lobby group, which represents around 400 firms, said. Foreign original equipment manufacturers must be given the opportunity to retain control of their proprietary technology so that they can provide the most advanced technologies, it added.
India, which is the world’s largest importer of arms, had offered to buy at least 200 fighter jets from foreign companies if they are manufactured in India with a local partner. After this, many foreign firms like US-based Lockheed Martin, Swedish Saab, and France’s Dassault Aviation expressed their interest to produce aircraft locally under the Make In India banner and the Defence Ministry’s “strategic partnership” policy. As part of this, a foreign company can collaborate with a local firm to develop India’s aeronautical base, and will hold 49% of the shares.