SME Times News Bureau | 23 Nov, 2019
The Ministry of Defence plans to set up 6-8 product testing
facilities to enable the micro, small and medium enterprises (MSME) to test
their products for defence supplies, said a senior official in Chennai.
The first testing facility, likely for drones, is to come up soon, he said on
Friday.
"In order to provide MSME's a level playing field in defence supplies and
also expand the vendor base, the Ministry of Defence has come up with a scheme
to set up 6-8 product testing centres in the defence industrial
corridors," Rear Admiral A. George, Additional Director General Quality
Assurance (Warship Projects), directorate general, quality assurance (DGQA),
told reporters.
He was here to participate in the Quality Assurance-Industry Conclave South
Zone.
The government has allocated about Rs 400 crore for this scheme whereby it
would provide a grant-in-aid of up to 75 per cent of the cost of equipment for
the product testing facility.
The balance 25 per cent has to be brought in by a consortium of private
investors. The product test facility will be a special purpose vehicle (SPV).
According to officials, while the test facilities are to come up in the two
defence corridors planned in the country, one facility outside the defence
corridor may come up early in order the meet the demand.
Officials said discussions are on with the industry players for setting up
product test facilities.
Earlier at the conclave, George formally awarded the 'Green Channel Status' to
L&T Valves - the valve manufacturing division of the Larsen & Toubro
group.
The Green Channel Policy was introduced by the government in 2017 as a part of
its 'Make in India' scheme. This allows manufacturers to self certify their
supplies to the defence services.
The companies with a turnover of Rs 1,000 crore during the last three years and
who are profitable for three years out of the last five years are eligible to
apply for the 'Green Channel Status', said George.
The Green Channel certification is valid for five years and can be renewed.
The L&T Valves caters to oil and gas, power, petrochemicals, chemicals,
water as well as defence and aerospace.
"The Green Channel Status enables the company for automatic enlistment with
all defence establishments offering more opportunities, faster execution and
higher throughput," Mahesh Joshi, Chief Executive and Director told IANS.
He also said a new plant in Saudi Arabia will go into operation soon to cater
to the market needs there.
According to Joshi, nearly 50 per cent of the company's revenue is from
exports.
He said as the company is catering to the different sectors, a slowdown in one
vertical does not impact the business much.
Joshi said the share of government orders for the company is about 14 per cent.