Defence stocks in focus as MoD puts 108 items on import ban list; HAL, Bharat Electronics stocks outperform

Raksha Mantri Rajnath Singh has approved a proposal of the Department of Military Affairs, Ministry of Defence (MoD) to notify the ‘Second Positive Indigenisation List’ of 108 items.

June 01, 2021 1:44 IST | India Infoline News Service
Bharat Electronics Limited
Shares of Hindustan Aeronautics Ltd, Bharat Electronics Ltd (BEL), Garden Reach Shipbuilders, Bharat Dynamics, Astra Microwave Products, BEML, Bharat Forge, Mishra Dhatu Nigam, and Mazagon Dock Shipbuilders were in demand in an otherwise volatile market.

The defence stocks came into the limelight after the Ministry of Defence (MOD) on Monday has approved imposing restrictions on the import of 108 military weapons and systems such as next-generation corvettes, airborne early warning systems, tank engines and radars.

Raksha Mantri Rajnath Singh has approved a proposal of the Department of Military Affairs, Ministry of Defence (MoD) to notify the ‘Second Positive Indigenisation List’ of 108 items. This will give a further boost to indigenisation with the active participation of the public and private sector for fulfilling the twin objectives of achieving self-reliance and promoting defence exports.

All the 108 items will now be procured from indigenous sources as per provisions given in Defence Acquisition Procedure (DAP) 2020.

Bharat Dynamics climbed 1.88%, Garden Reach Shipbuilders rose 1.64%, Hindustan Aeronautics Ltd, Bharat Electronics gaining 1%,

As per Ministry of Defence data released on Monday, the second list (enclosed) lays special focus on weapons/systems which are currently under development/trials and are likely to translate into firm orders in the future. Like the first list, import substitution of ammunition which is a recurring requirement has been given special focus. Not only does the list recognise the potential of the local defence industry, but it will also invigorate impetus to domestic Research &Development by attracting fresh investment into technology and manufacturing capabilities.

The ‘Second Positive Indigenisation List’ comprises complex systems, sensors, simulator, weapons and ammunitions like Helicopters, Next Generation Corvettes, Air Borne Early Warning and Control (AEW&C) systems, Tank Engines, Medium Power Radar for Mountains, MRSAM Weapon Systems and many more such items to fulfil the requirements of Indian Armed Forces. This second list is planned to be implemented progressively with effect from December 2021 to December 2025.

Towards this, the Ministry of Defence, Defence Research and Development Organisation (DRDO) and Service Head Quarters (SHQs)  will take all necessary steps, including hand holding of the Industry, to ensure that the timelines mentioned in the ‘Second Positive Indigenisation List’ are met, thereby facilitating an environment for Indian Defence Manufacturers to create world-class infrastructure, assist in Government’s ‘Make in India’ vision to make India self-reliant in defence and develop the capabilities for defence export in the near future. The Second Positive Indigenisation List will be hosted on the MoD website.

Meanwhile, equity benchmark indices revered early morning gains and slipped in the negative zone with the Nifty slipped below 15,600-mark. BSE Sensex is currently 51,946.71 up 9 points and Nifty50 is currently 15,573.45 down 9 points.

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