The Telegraph
Wednesday , May 28 , 2014
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Arun hint at FDI relook in defence

Army chief General Bikram Singh (right) greets Arun Jaitley after he took charge of the defence ministry on Tuesday. (PTI)

New Delhi, May 27: Arun Jaitley took over as interim defence minister today but, in what should be music to foreign arms majors’ ears, immediately signalled that the government was taking a re-look at the policy on foreign direct investment in the defence industry.

Jaitley has been given “additional charge” of the ministry of defence (MoD) along with the finance portfolio.

“MoD is only an additional charge with me till alternative arrangements are made with a full-time minister. But I will be spending a reasonable amount of time here every day,” he said after taking over.

He said it could take “a couple of weeks” for an expansion of the cabinet with a full-time defence minister.

But he said he had come with an agenda to “clear the backlog of work” and speed up equipment acquisition for the armed forces.

Jaitley sought to put a lid on a simmering row over the appointment of Lt General Dalbir Singh Suhag as the army chief-designate who is to take over after General Bikram Singh retires at the end of July.

“I firmly believe that there should be no controversy or issue (over the appointment of the army chief). There may have been some issues over the process but that does not reflect on the person in any way,” he said.

In the run-up to the elections, Jaitley’s ministerial colleague, General (retired) V.K. Singh, had suspected aloud that the Manmohan Singh government was acting in haste to name the current vice-chief, Lt General Suhag, as the next chief.

Jaitley’s debut as defence minister coincided with the crash of a MiG-21 fighter aircraft in which the pilot was killed near Avantipur in Kashmir. The outdated MiG-21 is the oldest among the fighter aircraft in the Indian Air Force fleet.

It is still being flown because the IAF has not been able to replenish its inventory with adequate numbers of fighter aircraft.

“Speeding up acquisitions is a priority area. In the last few years, there has been a slowdown,” he said.

He said the issue of increasing the 26 per cent FDI cap in the defence industry had already figured in preliminary discussions he had had with officials while taking over as the finance minister earlier in the morning.

Contrary to doubts that he would find it too demanding to be both finance and defence minister, Jaitley said the two portfolios could actually “supplement” each other. The defence establishment has often complained that the finance ministry has not been sensitive to, or has been too tardy with, funds for equipment purchases.

In his first address to defence ministry officials later in the afternoon, Jaitley said that he was keen on clearing the backlog in defence purchases, especially because the ministry dealt with external security threats.

Taking a leaf out of predecessor A.K. Antony’s book, he told the officials they must ensure there is no controversy and that they stick to the rulebook. Jaitley said he would devote three hours to the ministry every afternoon.