After assuming office, dealing with scams was biggest challenge: Parrikar

New Delhi: Defence Minister Manohar Parrikar on Wednesday said the biggest challenge he faced after assuming office was to "deal with scams".

"The biggest challenge was to deal with the scams. We formed laws after some scam was unearthed. It finally led to several stringent laws coming into force and halting entire defence procurement procedure," he said.

Terming as "not practical" the blacklisting of companies or entire group for the fault of its subsidiary, Parrikar said there are only 17-20 group of companies across the globe that are into defence equipment manufacturing and supply.

"There should be a practical approach while initiating any action against the faulty component or product supplied by particular company or arm of a major group. We could blacklist that particular part or arm. It is a subjective issue," he said speaking on "Strengthening India's Defence Capabilities", anchored by security analyst Nitin Gokhale, in suburban Bandra here.

The Defence Minister said the Union Law Ministry has approved the draft policy for black-listing the companies. "We will take it further soon".

Parrikar pitched for indigenisation of manufacturing of weapons, as Indian government spends lakhs of crore of rupees on its import.

"Self-reliance in weapons manufacturing is an imaginary thing. If a country achieves around 70 per cent indigenisation in weapon manufacturing, then it should be sufficient and (India) achieving it would be a good thing," he said, adding that by 2019, we will achieve that 70 per cent benchmark.

"There is no constraint of funds for defence procurement till 2027. Our requirement is projected on Union Finance Ministry's graph," he said.

Asked about the progress in development of weapons, the defence minister said, "Based on the Howitzer model, a light gun is in its final stage. Its weight would be 30 per cent of the existing canons deployed in mountains. Artillery guns of 155x52 calibre are also going to be replaced soon. These two are major achievements in development of weapons," he said.

Clarifying on the OROP issue, he said some people are creating a wrong perception. "Of the Rs 8000 crore demand, we have so far approved a package of Rs 7500 crore," he added.

Speaking to reporters on the sidelines of an industry exhibition on technology and material sciences in Navi Mumbai, Parrikar said "During the past 23 months that I have been in charge, we have signed contracts worth Rs 2.2 trillion.

Recently, we signed a letter of intent with a government-run shipyard for about Rs 32,000 crore, taking the total orders to Rs 2.5 trillion."

"Over the next six months, I hope to sign another Rs 50,000-60,000 crore worth of contracts, taking the total to Rs 3 trillion," he said.

"The Make in India initiative has seen defence exports from Rs 500 crore to Rs 3,000 crore, though the ministry figures will show only Rs 2,100 crore. One reason for this is that export of aviation sector items are not included in this as it has been delicensed."

When asked about the inflows through the FDI route after foreign direct investment cap was hiked to 49 per cent, he said so far it has been about USD 100 million but will go up as foreign capital flows in.

Parrikar also said his Ministry is finalising a new strategic materials policy so that we can promote production as well as storage of defence-related strategic materials.

"We have set up a study team to draft a new strategic materials policy to promote the sector, which involves production and storage of these materials," he said.