New Delhi: Rejecting the Defence Ministry's view on foreign direct investment, a Parliamentary committee has recommended enhancement in FDI limit to attract foreign companies as it would benefit the Indian defence sector in the long run and save precious foreign exchange. The Standing Committee on Defence took note of the divergent views within the Ministry over the issue. While the Department of Defence Production opposes FDI, the DRDO favours it, the Committee said.
"The Committee desire to recommend enhancement in the FDI limit to attract foreign companies which in a long term would benefit not only the Indian defence industry but also help in providing employment opportunities and saving precious foreign exchange," the Committee said in its report. It noted the Defence Ministry's point of view for not increasing the FDI was, "if there is a war situation and a particular country which has set up a production facility in India withdraws production process, it may prove suicidal for our national interest."
In the Action Taken Report of the Committee, the DRDO chief stated that improving FDI will bring in more players and will also probably bring some technology in the country's industrial sector and R&D area. The Committee also took note of the increasing number of ceasefire violations along the border with Pakistan. "The Committee is perturbed over the beheading of one of our soldiers and killing of the other. The Committee desires that apt and swift action should be taken by the government in order to create deterrance for ceasefire violations in future," it said.
DRDO chief stated that improving FDI will bring in more players and will probably bring some technology in the country's industrial sector and R&D area.