Empowered defence authority can step up FDI inflow: Assocham

NEW DELHI: An empowered defence authority will facilitate the flow of FDI in the sector as investment worth $ 10 bn is expected during 2007-12, industry body Assocham said.

"The Defence offset policy is expected to bring in USD 10 billion during the 11th Five-Year Plan period (2007-12) as every foreign company is required to spend 30 per cent of the value on offsets goods or services purchased from Indian defence companies," Assocham said in a statement.

"Empowering a single defence offset authority will result in a consistent interpretation and implementation of offset guidelines," Chamber President Sajjan Jindal said in a paper on Defence Procurement Policy submitted to the Defence Ministry.

Assocham stressed that the Defence Offset Facilitation Agency (DOFA), which is under the Defence Ministry, needs to be authorised to involve India Inc to participate in defence deals as the domestic defence market was likely to grow over $700 mn in the next five years.