NEW DELHI, JULY 23: With the Left safely out of the way after the trust vote, the Government is set to push key deals in the defence sector — including reforms in the private defence manufacturing industry and a set of missile procurements from Israel.

One of the first things the Government will ensure is that Indian companies are granted the Raksha Udyog Ratna (RUR) status, which will allow them to act as system integrators and manufacture complete weapon systems for the armed forces.

The RUR policy, initiated in 2006 to bring private sector companies at par with Defence PSUs, has been stuck for more than two years due to objections raised by the Left parties. This has created major problems as the country is expecting an inflow of over $10 billion in the defence sector over the next five years due to the offset policy.

On several occasions, Union Defence Minister A K Antony himself admitted that the present public sector setup was not adequate to absorb the offsets. The private sector needs to step in and assume a bigger role, he had said. The current defence procurement policy mandates a 30 per cent direct offsets for all defence deals worth over Rs 300 crores.

Although a list of 13 companies, which are to be granted the RUR status were shortlisted by an expert committee last June, the policy has been stuck for over a year even after two meetings were initiated on behest of the Left between PSU unions and the MoD.

On the procurements front, the ministry is set to push through a group of urgent missile deals — that have been stuck over the past few months as relations with the Left deteriorated — with Israel for the Navy and Air Force.

Topping the list is a $120 million deal to procure additional missiles from Israel’s Rafael Advanced Defence Systems Ltd to arm the Navy’s Barak ship defence systems. The Navy has an urgent requirement of 250 missiles for its 10 Barak systems.

While the deal has been given a go-ahead by the CBI, which had named the company in an FIR for alleged kickbacks in the Barak missile defence system deal, a political decision to clear it was stuck with the Cabinet Committee on Security (CCS) for a few months due to the political uncertainty. A similar $325-million deal to procure Rafael’s Spyder Air Defence System for the Indian Air Force has also been stalled for over a year.