The development of a manufacturing base in the country is a top priority for the government, especially in the aerospace and defence sector. A critical focus area to further develop the defence industrial base is defence testing infrastructure. Domestic defence production would be well supported by an easily accessible state of the art testing infrastructure. However, this is another capital-intensive segment and would require continuous upgradations and modifications to be in sync with changing technologies and requirements. Hence, it is not an economically viable investment for individuals, particularly smaller defence industrial units to set up facilities in-house. This is where the Government can step in to provide the thrust that is required to set up the requisite testing infrastructure.

The Government has released a draft scheme aimed at setting up greenfield defence testing infrastructure for aerospace and defence related production. The facility would be a common facility under the private sector with government assistance. A major objective of the scheme is to encourage MSMEs and start-ups participation as the infrastructure, once set up, would provide easy and feasible access to the domestic defence industry. Given the fact that the very nature of setting up Defence Industrial Corridors (DICs) is to support large number of industries in the sector, the scheme provisions for giving a preference to DICs for setting upDTIs.

The private sector is expected to set up testing and infrastructure facilities with financial assistance from the central government in the form of grant-n-aid for setting up these DTIs. The segments for which DTIs can be set up include

Testing facilities for drones/ UAVs/ RPAs

EMI / EMC testing for radars and electronic/ telecom equipment

Specialised test-driving tracks

Ship motion testing

Radiated noise and shock testing

Ballistic and blast testing facilities

Electronic warfare

Environment test facilities

Rubber testing for defence and aerospace sectors

Test facilities for aerospace industry

Software testing

Any other area lacking testing infrastructure

Each DTI will be set up via a Special Purpose Vehicle (SPV), a Section 8 company under the Companies Act 2013, which would he the Implementation Agency (IA) comprising private entities including private companies, industry associations, and R&D institutions. The grant in aid from the central government would be limited to a sum total of Rs 400cr while the assistance for individual DTIs would not exceed 75 per cent of the project cost. The grant broadly covers 3 small, 3 medium and 2 large facilities with estimated costs at less than Rs 20crore, between Rs 20 and 50crore and greater than Rs 50crore respectively. The number at facilities under each category could however be altered if need arises.

At least 7 private entities could constitute the IA but eachsuch constituent should not have more than 25 per centof totalshare capital of the IA. There are other conditions to be fulfilled as well. The roles and responsibilities of IAs have also been spelt out.

This scheme is expected to support start-ups and MSMEs, which will then bridge gaps in defence testing infrastructure In the country. The government expects these new facilities, once established, to resolve three critical bottleneck in defence production. A few large private companies in India have reportedly spent huge amounts to create their own laboratoriesto validate their manufactured products. However, not all firms/ companies can afford this given the fact that there are only few assured orders. These facilities would, therefore, remove this bottleneck, thereby increasing work on the research and development front.