Global trade tensions and escalating tariff wars have exposed significant flaws in the ‘Just-in-Time’ (JIT) supply chain model, as highlighted by Defence Minister Rajnath Singh.

Addressing senior defence officers and private sector representatives, Singh noted that until recently, global defence manufacturing heavily relied on complex, international supply chains, with timely deliveries enabled by a stable global environment.

The JIT model, which minimises inventory by sourcing components as needed, functioned effectively under these conditions.

However, recent years have seen a dramatic shift. Trade restrictions, tariff wars, and geopolitical instability have revealed the vulnerabilities of over reliance on foreign components and logistics networks.

Disruptions caused by these factors have led to delays, increased costs, and uncertainty, exposing the limitations of the JIT approach. Singh emphasised that the defence sector worldwide is now transitioning towards a ‘Just-in-Case’ (JIC) model.

This approach prioritises resilience by maintaining backup plans, larger inventories, and localising the production of critical components. The JIC model aims to ensure manufacturing continuity even amid global disruptions, by stockpiling essential goods and developing domestic or regional supply chains.

Singh also highlighted the Indian government’s efforts to promote self-reliance in defence manufacturing. He contrasted the current administration’s belief in India’s capabilities with previous governments, noting significant achievements in indigenisation.

The corporatisation of ordnance factories has resulted in increased efficiency and profitability. Initiatives to support start-ups and MSMEs, including procurement approvals worth over ₹2,400 crore and technology development projects exceeding ₹1,500 crore, further underline this shift.

India has made notable progress in areas such as aero engine manufacturing, with ongoing collaborations with global firms like Safran, General Electric, and Rolls Royce.

The country’s shipbuilding sector has also advanced, with indigenous aircraft carriers like INS Vikrant and over 90 warships now built domestically. More than 97% of Indian Navy and Coast Guard vessels are produced in Indian shipyards, and exports to friendly nations are rising.

The current global trade environment, marked by protectionism and volatility, has forced a re-evaluation of supply chain strategies.

The move from JIT to JIC reflects a broader trend towards supply chain resilience and self-reliance, especially in critical sectors like defence. India’s policy response, focused on domestic capability and reducing external dependencies, is positioning the country to better withstand future global shocks while fostering innovation and export growth.

ANI