NEW DELHI — India has inked 17 defense offsets worth $4.28 billion from arms contracts signed since October 2007, Defence Minister A.K. Antony told Parliament.
Since 2005, foreign defense vendors have been required to execute offsets worth 30 percent of a contract’s value when the deal is more than $60 million.
The ongoing $11 billion Medium Multirole Combat Aircraft program, which requires defense offsets worth 50 percent of contract value, will sharply increase total offsets in coming years.
Antony said offset contracts worth about $3.43 billion were signed for procuring aircraft, radars, drones and other systems for the Air Force, and $843 million for the Navy to buy fleet tankers, maritime reconnaissance aircraft, radars and UAVs.
Last month, foreign defense companies were allowed to fulfill their offset obligations through technology transfer, in addition to direct offsets. This would mean that acquisition of technology from overseas by India’s Defence Research and Development Organization will also be treated as offsets under the technology transfer category.
Banking offsets have already been allowed, under which a defense company can credit its offsets now for future use to claim benefits of offsets.