Launched in 2016 and executed by the Defence Research and Development Organisation (DRDO) under Make in India programme, the government has allocated Rs 260 crore under the scheme since its inception.
MSMEs in Defence sector: The Defence Ministry’s Technology Development Fund (TDF) scheme, which aims to encourage the participation of MSMEs and startups to design and develop various defence technologies indigenously, has so far supported 41 MSMEs and 20 startups. Launched in 2016 and executed by the Defence Research and Development Organisation (DRDO) under Make in India programme, the government has allocated Rs 260 crore under the scheme since its inception.
Sharing the data in a written reply to a question in the Lok Sabha earlier this week, Ajay Bhatt, Minister of State in the Defence Ministry noted that out of the amount allocated, Rs 64.35 crore was disbursed as a grant-in-aid to industries for the development of defence technologies.
According to the scheme, two types of funding mechanisms are available. First, the DRDO share of the project cost is paid in a maximum of five instalments in the form of reimbursement upon successful achievement of milestones by businesses. Second, advance funding of the project subject to a maximum of five milestones of the project.
Meanwhile, over 30,000 defence items by defence public sector units (DPSUs) and services on the Srijan portal were offered to the industry including MSMEs to become partners in the indigenisation process, Bhatt had informed Parliament last month. The value of defence production had crossed Rs 1 lakh crore for the first time ever during FY23.
Moreover, the Defence Ministry had nearly doubled its online procurement of goods and services from MSMEs and other sellers in the financial year 2022-23 from the previous fiscal via the Government e-Marketplace (GeM) marketplace. The ministry had bought goods worth Rs 28,732.9 crore in FY23, up by 90.4 per cent from Rs 15,090.8 crore worth of goods and services bought in FY22.
In February this year, SIDBI — the principal financial institution in the country to promote and finance MSMEs had signed a memorandum of understanding (MoU) with the Society of Indian Aerospace Technologies and Industries to “facilitate mutual co-operation between the institutions for the overall benefit of MSMEs in aerospace and defence and other sectors.” SIATI is the industry body for enterprises including MSMEs in the aerospace sector.