No R&D Boost, Say Pvt Players in Defence


The Budget seems to have failed to impress small-scale private sector industries around Pune city. The Pimpri-Chinchwad Municipal Corporation area alone has about 4,000 Small and Medium Enterprises (SMEs), while the total number, including those in Chakan, is 7,000.

“The Budget has nothing for SMEs. We were looking for reforms to motivate SMEs, but besides the Rs 1,000 crore to develop skilled labour, there is nothing to cheer about. Further, the budget has come as a jolt for those who directly sell manufactured goods in the market,” said Deepak Karandikar, chairman, SME sub-committee, MCCIA.

The city also has a number of SMEs working for the defence sector and despite a 17.6 per cent increase in defence allocation, the Budget is blamed for offering nothing to boost Research and Development (R&D) and manufacturing in the private sector. “From a defence allocation of Rs 1.64 lakh crore last year, the FM increased it to Rs 1.93 lakh crore. While the Budget takes into account ongoing acquisitions and procurements, no effort has been made to increase private participation either in production or R&D. SMEs, or for that matter even bigger players in the city, have the capacity to develop critical defence technology but what is encouraged is developing systems and sub systems for ordnance factories and DRDO which is like underestimating the potential of these industries,” said Brigadier (retd) S B Ghorpade, chairman, defence subcommittee, MCCIA.

Vikram Salunke, MD, Accurate Engineering Co Pvt Ltd, said, “Withholding tax on certain sectors such as dams, power, irrigation, airlines was slashed from 20 to 5 per cent. It would have been beneficial had this been made applicable to defence and aerospace manufacturing as well.” Abhijeet Sarkar, MD, Raksha Polycoats Pvt Ltd said, “The PM had recently announced to allot two per cent of GDP to R&D from existing 0.8 percent, which is not there. The question bothering the private sector is how to finance R&D .”