What is defence industrial production corridor?

Representative Image.

Defence Minister Nirmala Sitharaman on Thursday stated that the first defence corridor will be built starting from Tamil Nadu, linking Chennai and Bengaluru.

While presenting the Union Budget 2018 on February 1, Finance Minister Arun Jaitley had stated that the government will develop two defence industrial production corridors to promote the defence sector.

What is a defence industrial production corrridor? 

A defence corridor refers to a route or a path along which domestic productions of defence equipment by public sector, private sector and MSMEs are lined up to enhance the operational capability of the defence forces.

The government has now opened up private investment in defence production including liberalising foreign direct investment.

Apart from improving the connectivity of the defence forces, the move will encourage domestic production of defence equipments and benefit all small and medium manufacturers along the corridor.

"A number of initiatives have been taken to develop and nurture intrinsic defence production capability to make the Nation self-reliant for meeting our defence needs," Jaitley said in his Budget speech.

Jaitley added that the government will also bring out an industry friendly Defence Production Policy 2018 to promote domestic production.

The locations of these corridors are strategically decided by the Defence Ministry while taking into account a natural ecosystem that could be utilised for enhancing the existing defence network.

Last month, Nirmala Sitharaman had asked the government of Tamil Nadu to plan a defence corridor connecting Kattupalli port, Chennai, Tiruchirapalli, Coimbatore, Hosur and Bengaluru.