While India has not been a threat to any country, due to geo-political position it has always been vigilant to defend its borders. Since Independence in 1947, we have faced hostile neighbours. Time and again our gallant forces have shown competence and skills. The armed forces also need technical superiority to match their courage. India has given due importance to the indigenous development since Independence by setting up Defence Research and Development Organisation (DRDO), Defence Public Sector Undertakings (DPSUs) and Ordnance Factory Board (OFB).
These institutions have done some wonderful work and overall indigenous development and production has significantly increased. At the same time the world has moved at faster pace creating a wide technical gap and high risk to national security. To keep up with threats, India has two options – develop the technology indigenously or import it.
The import of technology is executed under the rulebook of ‘Transfer of Technology’ (ToT), where a foreign firm provides ‘technology’ and enable the buyer to manufacture defence systems locally. The prime purpose of the ‘Transfer of Technology’ is to elevate defence production capabilities and attain self-reliance in that particular domain of technology. One of critical outcomes expected of the ToT is to have technology rubbing, which should enable a thriving ecosystem. Since India has been using ToT route to shore up its defence production capabilities for five decades, we should have become self-reliant in fighter aircraft, helicopters, armoured tanks, artillery guns and various other areas. Today India holds the embarrassing distinction of being one of the largest importers of defence systems in the world.
It is clear that the ToT route has failed to achieve the intended outcome. Where does the problem lie then?
There are many reasons for the ineffectiveness of ToT and both sellers and buyers are responsible to it. From seller’s side, it is true that the sellers impose various restrictions to maximise their economic returns. Setting the boundaries on end use, discouraging further research and development in the field and forcing buyers to purchase critical parts from the seller are some of tricks adopted by technology providers.
On the buyer’s side the lack of managerial skills, shortsightedness and overdependence on bureaucrats for technical aspects are main reasons why India fails to absorb and build on the received technologies. Often the recipient just end up being a local production house under license and the technology does not get transferred in right sprit. Indian production agencies do the value addition in a few parts but still, the dependencies on the critical part remain and technical gap is not bridged. We end up funding the R&D cost of other countries.
So is ToT not a desirable route? Should we keep buying defence systems outright until indigenous development catches up? Or can we manage the ToT differently to make it effective and use strategically to accelerate our capabilities in the area where we are lagging?
The way forward
It is time to define a new framework on “Technology Transfer”. For technology transfer to be effective, there is a need to understand it holistically and address all phase of this process.
Technology Identification: Before taking decision to buy ToT, we must identify and evaluate the technology for our requirements, its newness, its compatibility and our preparedness to accept it. The purpose of ToT is to fill the gap and it will be possible only when we have a consolidated view of developments happening in our labs. As the ToT has high financial cost, we must choose it wisely.
Technology Transmission: Effective transmission of technology cannot be achieved by visits of few from leadership, signing a MoU and making press releases. For it the technical team needs to spend time at each-other’s facilities, follow a structured approach, and make right documentations and walk together closely in initial period. Engagement of academic institutes and research organisations in whole process will bring desired outcome.
Technology Absorption: This is most critical phase of ToT and often most neglected. The recipient company must develop a plan and ecosystems to absorb the technology. It starts with identifying the right team, training them on basic of technology, upgrading your technical infrastructure, improving process controls and other related checks to accept and starts using the technology.
Technology Diffusion: The final aim of any ToT is to have “Rubbing effect” on the local players. The Technology Transfer should not help the recipient alone but also upgrade the Tier-1, Tier-2 suppliers. Over time due to people’s movement, vendors outreach and offset requirements the technology diffuse in the ecosystem and players who are not directly involved in this process also get benefits. Overall quality of the suppliers improves which happens just due to sharing the same technical space.
Today when various defence companies are wooing India and willing to partner in ToT process, it’s time to consider the “Technology Transfer” as a specialised skill. From the start it should not be left as an administrative process but a dedicated Technology Transfer Manager must be identified. With detailed, well thought out and executed negotiations and ToT planning and long term vision, India can make ToT a more effective means of self-reliance in defence.
– The author is Vice President, Avianco Technology, which has developed Indigenous UTM platform for drones. He can be reached at sahaynk@gmail.com
