"Public procurement can shape industrial ecosystems." Discuss with historical and contemporary examples, including India's defence indigenisation drive.

Public procurement means the state buying goods, services and works. The state is usually the largest single buyer, so its orders create assured demand. That demand can start, grow or redirect whole industries. History and India's defence indigenisation drive show this power, and also why it needs safeguards.

Historical examples

• State as anchor customer: In 1926 the British War Office replaced open blades with safety razors for soldiers. This was a bulk order for a new mass-produced consumer good. The supplier also had to take over more than 100,000 long-handled razors from Army stocks [1].
• Economic nationalism: In Parliament, members questioned why the supplier had a "well-known American name". The Government replied that the firm was of "entirely British character" [1]. Procurement was already being used to decide who counts as domestic.
• Wartime mobilisation: By February 1942, Gillette's Boston razor plant had been converted to make tool posts for war production [2]. State demand re-tooled a consumer industry.

Contemporary India: defence indigenisation

• Ownership-based priority: Under DAP 2020, the top-priority category, Buy (Indian-IDDM), is open only to Indian-owned vendors with FDI of no more than 49%. Foreign OEMs can take part through Buy (Global–Manufacture in India) [3].
• Deeper supply chains: At least 50% of indigenous content must be material, components and software made in India [3]. This builds up MSME suppliers and prevents simple assembly of imported parts.
• Reserved demand: In 2020 the Ministry of Defence notified 26 items to be bought only from local suppliers, whatever the purchase value [4].
• Local-content rules: Under the PPP-MII Order, 2017, a Class-I supplier needs at least 50% local content and a Class-II supplier at least 20%. The 2020 amendment lets nodal ministries set higher levels [5].

Limits and risks

• Life-cycle lock-in: The 1926 razor swap created repeat demand for blades. Yet Parliament debated the supplier's nationality, not the long-term cost [1]. Defence spares and servicing create the same dependence on the first seller.
• Cost and delay: Reserving orders where local capacity is thin can raise prices and slow down the forces' modernisation.
• Accountability: Large contracts need transparent and competitive trials, which DAP 2020 itself stresses [3], along with parliamentary oversight.

Procurement is therefore industrial policy by other means. If India pairs assured demand with life-cycle costing, competition and scrutiny by the Public Accounts Committee, defence indigenisation can build a competitive, export-ready ecosystem. That would advance Atmanirbhar Bharat and SDG 9 (industry and innovation).