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Illustration: Binay Sinha
India, the world’s largest arms importer, has received more than $7 billion in compensation from international entities that had sold defense goods to the country.
Defense companies that win large orders must compensate this by investing in local industry or by purchasing from them. This is called defense compensation and is essentially a mechanism whereby the outflow of resources for defense is offset by the development of local industry or technology transfer.
According to Defense Department data, the total amount covered by defense compensation as of March 2020 was $2.9 billion.
First print: January 16, 2024 | 10:01 PM IST