wintry January morning in Bengaluru saw the coming together of two very unlikely sets of people. Bharat Electronics Ltd (BEL), Hindustan Aeronautics Ltd (HAL) and Bharat Earth Movers Ltd, all suppliers of various defence equipment to the armed forces, were hosting an event at the BEL Officers Club. It was a mission to woo startups—an officious sounding seminar called ‘Role of startups in defence’ where about 50 startups showed up. Senior officials in ill-fitting suits from these three companies took turns to talk about their companies, their R&D prowess and how their guns protect the borders. In the middle of this three-hour PR pitch, there was one very cautious voice that said it like it is.

“Control your aspiration and expectation,” advised Ajit Kalghatgi, BEL’s director for R&D, to a room of expectant and bright-eyed startups. Kalghatgia post graduate in microwave and radar engineering from IIT Kharagpur and a PhD from Leeds Universitydid not, even for a minute, want to entertain the thought that the startups could expect to work with such bellwethers and become the next Facebook.

Attention, startups!

India imports nearly 60% of its defence equipment, spending close to $6.4 billion every year. And the government’s incessant messaging to Make in India, which is reflected even in the Defence Procurement Policy (DPP), released in 2016, was the stimuli that jolted the PSUs into action.

Data source: Stockholm International Peace Research Institute

Moreover, the sector stares at a tantalisingly delicious $15 billion offset opportunity in backlogs. Offsets are a way by which the government brings back some business that local manufacturers lose due to imports. And according to the new DPP, foreign manufacturers securing orders worth more than Rs 2,000 crore from India need to source components worth 30% of the order value from India. But to absorb it, PSUs would do well with the new technology that startups bring to the table.

“We began looking at startups only after the government’s mandate, and now we are looking at ways to support them,” said A Selvaraj, general manager, indigenisation at HAL, from the sidelines of the event. He says startups were not on their radar earlier because, for the kind of equipment they were making, the capability just did not exist in India so they relied on imports. And once they began importing, they didn’t look to break that cycle as they would have to go through the cumbersome process of getting it re-certified, he said.

They were some hard habits to break, and only a mandate from the very top could make them do it.

Even the seminar was the result of a nudging from the ministry of defence, says a senior official, who was a part of the event.

AUTHOR

Arundhati Ramanathan

Arundhati is Bengaluru-based. She is interested in how people use money in the digital age and how new economies will take shape based on that interaction. She has spent over 10 years reporting and writing on various subjects. Previous stints were at Mint, Outlook Business and Reuters.

View Full Profile

Available exclusively to subscribers of The Ken India

This story is a part of The Ken India edition. Subscribe. Questions?

MOST POPULAR

Annual Subscription

12-month access to 200+ stories, archive of 800+ stories from our India edition. Plus our premium newsletters, Beyond The First Order and The Nutgraf worth Rs. 99/month or $2/month each for free.

Rs. 2,750

Subscribe
 

Quarterly Subscription

3-month access to 60+ new stories with 3-months worth of archives from our India edition. Plus our premium newsletters, Beyond The First Order and The Nutgraf worth Rs. 99/month or $2/month each for free.

Rs. 1,750

Subscribe
 

Single Story

Instant access to this story for a year along with comment privileges.

Rs. 500

Subscribe
MOST POPULAR

Annual Subscription

12-month access to 150+ stories from Southeast Asia.

$ 120

Subscribe
 

Quarterly Subscription

3-month access to 35+ stories from Southeast Asia.

$ 50

Subscribe
 

Single Story

Instant access to this story for a year along with comment privileges.

$ 20

Subscribe

Questions?

What is The Ken?

The Ken is a subscription-only business journalism website and app that provides coverage across two editions - India and Southeast Asia.

What kind of stories do you write?

We publish sharp, original and reported stories on technology, business and healthcare. Our stories are forward-looking, analytical and directional — supported by data, visualisations and infographics.

We use language and narrative that is accessible to even lay readers. And we optimise for quality over quantity, every single time.

What do I get if I subscribe?

For subscribers of the India edition, we publish a new story every weekday, a premium daily newsletter, Beyond The First Order and a weekly newsletter - The Nutgraf.

For subscribers of the Southeast Asia edition, we publish a new story three days a week and a weekly newsletter, Strait Up.

The annual subscription will get you complete, exclusive access to our archive of previously published stories for your edition, along with access to our subscriber-only mobile apps, our premium comment sections, our newsletter archives and several other gifts and benefits.

Do I need to pay separately for your premium newsletters?

Nope. Paid, premium subscribers of The Ken get our newsletters delivered for free.

Does a subscription to the India edition grant me access to Southeast Asia stories? Or vice-versa?

Afraid not. Each edition is separate with its own subscription plan. The India edition publishes stories focused on India. The Southeast Asia edition is focused on Southeast Asia. We may occasionally cross-publish stories from one edition to the other.

Do you offer an all-access joint subscription for both editions?

Not yet. If you’d like to access both editions, you’ll have to purchase two subscriptions separately - one for India and the other for Southeast Asia.

Do you offer any discounts?

No. We have a zero discounts policy.

Is there a free trial I can opt for?

We don’t offer any trials, but you can sign up for a free account which will give you access to the weekly free story, our archive of free stories and summaries of the paid stories. You can stay on the free account as long as you’d like.

Do you offer refunds?

We allow you to sample our journalism for free before signing up, and after you do, we stand by its quality. But we do not offer refunds.

I am facing some trouble purchasing a subscription. What can I do?

Please write to us at [email protected] detailing the error or queries.