Raise FDI in defence sector, says Naresh Chandra panel.

NEW DELHI: Batting for increasing FDI limit in the defence sector from the present 26%, the Naresh Chandra panel has said it would attract foreign vendors to offer their latest technologies for manufacturing military hardware in the country.

The committee was formed by the Prime Minister's Office (PMO) recently to suggest reforms in the national security apparatus.

At present, the FDI limit in defence sector is 26% as the defence ministry has been opposing any increase in it.

"There is every need to support higher FDI so that the latest technologies already developed by foreign entities and owned by them find their way into manufacturing defence items within India," the Committee has recommended in its report.

"The limit of FDI in defence industries should be raised for partnerships both with defence public sector units and with private Indian companies," it said.

On the FDI issue in the defence sector, global and Indian firms have been demanding that the limit should be increased upto at least 49% saying this would help in encouraging foreign vendors to offer high-end technology.

Recently, the US deputy defence secretary Ashton Carter had also demanded that if India increases FDI ceiling, it would increase commercial incentives to invest for global firms.

Source : timesofindia.indiatimes.com