What are Defence Corridors?
India is one of the top 5 military spenders and one of the emerging defence manufacturing hubs in the world. In order to support the growth of the defence sector and enhance the manufacturing capacity, two Defence Industrial Corridors have been set up in India, one in Uttar Pradesh and another in Tamil Nadu by the Central Government.
On 26 July 2021, the Ministry of Defence informed Rajya Sabha about the land acquisition for the two Defence Industrial Corridors. The lands in both the states at the identified nodes have been acquired for DICs. The information was shared by MoS Defence Ajay Bhatt in a written reply to SP leader and Rajya Sabha MP Rewati Raman Singh.
As of 19 July 2021, the total investment made by the Public/private sector in the UPDIC and TNDIC is Rs.1236.10 crore and Rs.2252.28 crore respectively. The production of armament/ammunition, components of aerospace industries, missile systems, and establishment of research & development facilities has been envisaged in the two DICs. Since the two DICs are in formative stages, it may not be possible to assess the number of likely employment. However, as per present estimates reported by the respective State Governments based on MoUs signed by them with the Industries, the UPDIC has the potential to generate employment for more than 16,700 persons, and the TNDIC has the potential to generate employment for 25,000 persons in the coming years.
The establishment of Defence Industrial Corridors in India was announced in Budget 2018-19. In pursuance of this announcement, the Ministry of Defence identified six nodes in Uttar Pradesh Defence Corridor and five nodes in Tamil Nadu Defence Corridor.
In 2020, investments of approximately Rs. 3,700 crore were announced by Ordnance Factory Board (OFB/Defence Public Sector Undertakings (DPSUs) & Private Industries for Uttar Pradesh Defence Corridors and investment of approximately Rs. 3,100 crore were announced by OFB/DPSUs & private industries for Tamil Nadu Defence Corridor.
Uttar Pradesh Defence Industrial Corridor
Uttar Pradesh Defence Industrial Corridor is being set up by the Uttar Pradesh Expressways Industrial Development Authority (UPEIDA). It consists of the following six nodal points:
As per the official sources, Plug and Play support will be provided to the industries in the corridor having the below-mentioned facilities:
1- Assured water and uninterrupted electricity supply (132 KVA) along with pelican wire fencing boundary wall at the site.
2- Connectivity with 4-lane heavy-duty highway connected with Bundelkhand Expressway and Delhi-Jhansi.
3- Single Window approvals and clearances to Defence and Aerospace (D&A) manufacturing units via Nivesh Mitra (single window system of the state).
4- Labour permits for Defence and Aerospace (D&A) industry for flexible employment conditions.
5- Simple procedures and rationalised regulatory regime with easy reimbursement of incentives and subsidies.
In the UPDIC, Uttar Pradesh Expressways Industrial Development Authority (UPEIDA), the nodal agency, has inked 55 Memorandum of Understandings (MoUs) with private industries, worth potential investments of Rs.7449.33 crore.
Tamil Nadu Defence Industrial Corridor
Tamil Nadu Defence Industrial Corridor is being set up by the Government of Tamil Nadu. It consists of the following five nodal points:
Tamil Nadu has the below-mentioned strategic advantages, making it a suitable destination for the defence sector:
1- Large coastline having three large government seaports, one large private seaport and 22 minor ports.
2- Tamil Nadu has four international airports at Chennai, Coimbatore, Trichy, Madurai, and two domestic airports at Tuticorin and Salem.
3- It is a power surplus state with a renewable energy capacity of 11,113 MW.
4- The capital city Chennai is connected with the world via three submarine cables providing a bandwidth of 14.8 Tbps.
5- It is the largest recipient of Korean Foreign Direct Investment (FDI) to India.
In the TNDIC, Tamil Nadu Industrial Development Corporation (TIDCO), the nodal agency, has inked 22 Memorandum of Understandings (MoUs) with private/public industries, worth potential investments of Rs.4800 crore.
Land Acquired for Defence Corridor
Land Acquired in 2020-21
Aim of Defence Industrial Corridors
The establishment of the DICs aims at providing a fillip to the defence manufacturing ecosystem through synergistic development of technologies, promote the growth of private domestic manufacturers, including MSMEs and Start-Ups. At present, both DICs are in their formative stages.
Significance of Defence Industrial Corridors
Along with promoting Make in India campaign, the Defence Industrial Corridors will catalyse indigenous production of defence and aerospace-related items, thereby reducing our reliance on imports and promoting exports of these items to other countries.
The joint efforts of the Government of India and several private players will help India in realising its goal of self-reliance in defence, generate direct and indirect employment opportunities and spur the growth of private domestic manufacturers, Micro Small and Medium Enterprises (MSMEs) and Start-ups.