The Innovations for Defence Excellence (iDEX) initiative was launched in April 2018 with the goal of achieving self-reliance and fostering innovation and technology development in defence and aerospace by engaging MSMEs, start-ups, and innovators. In a short period of time, the platform has been able to engage with over 6,000 defence start-ups, zero in on over 300 start-ups, and is currently working with nearly 200 of them.
With the increasing use of technology and dependency on digital for modernisation in military operations and handling of sensitive information makes defence forces vulnerable to a wide range of cyber-attacks, a senior official said that cybersecurity has become a key ‘priority' for defence ministry's start-up arm.
“In the past two to three years, as the iDEX has stabilised and gained credibility from start-ups, incubators, and innovators, we have decided to focus on specific areas to strengthen our defence forces. In this context, we have identified cybersecurity as our next focus area. During the upcoming Aero India event, we will launch a set of problem statements related to cybersecurity,” Vivek Virmani, PO (G) & COO, iDEX, Defence Innovation Organisation (DIO), Ministry of Defence, said in an interview with TechObserver.in
“Cybersecurity is a critical and delicate aspect. Service personnel are understandably cautious about it, but we must find a balance between caution and practical implementation where necessary. With the numerous ways that systems can be compromised, it is impossible to completely avoid it. However, we can add additional layers of security for sensitive information, or in the first instance, we can avoid putting sensitive information in a digital mode and we can go for it in a gradual way. As we proceed with digitisation, it is crucial to constantly upgrade our systems to ensure security,” he added.
Over the last 2-3 years, iDEX has launched many startup ‘Challenges' to solve problem statements of the Indian defence forces. How has been your evolution so far and what is going to be the key focus for you in the next year?
iDEX began its journey by solving small, specific problem statements of Services (Army, Navy, and Air Force) which earlier used to take them years to materialise as a procurement order, even if something was available off the shelf. We started by developing solutions that would then be procured within a short timeframe of two to four or five years. The initial problem statements we received were carefully selected and launched as a ‘challenge' for the startup. In the past two to three years, as the system has stabilised and gained credibility from startups, incubators, and innovators, we have decided to focus on specific areas to strengthen our defence forces.
In this context, we have identified cybersecurity as our next focus area. During the upcoming Aero India event, we will launch a set of problem statements related to cybersecurity. It is important to note that cybersecurity is a critical and delicate aspect. Service personnel are understandably cautious about it, but we must find a balance between caution and practical implementation where necessary. With the numerous ways that systems can be compromised, it is impossible to completely avoid it. However, we can add additional layers of security for sensitive information, or in the first go, we can avoid putting sensitive information in a digital mode and we can go for it in a gradual way.
As we go along with digitisation, it is crucial to constantly upgrade our systems. Without upgrading, it is likely that someone will find a way to break in. However, this also means that we must first procure the previous system for the startups to sustain themselves. Thus, it is a cycle that will have to continue.
What role do you see for the iDEX startups, especially in defence modernisation and India's tryst with defence indigenisation?
iDEX focuses on innovation through startups. Indigenisation is not our primary focus, but it is a natural trajectory that comes as we advance in innovation. We already have ‘Challenges' that require significant innovation, but at the same time, Services and defence Public Sector Units (DPSUs) have also requested that startups help make existing systems more dynamic and rugged.
Given the active startup community, along with new innovation, there are some parts that can be replaced or, at the very least, some modules can be indigenised at a sub-component level. Services and PSUs are aware of the input and output functionalities, and if startups can help replace them with something new or more dynamic but also rugged, it will add significant value to them. This is the kind of indigenisation we are looking at, but it is being done through innovation.
The extended sales cycle and rigorous follow-up make government business difficult for most companies. The defence may be more complex than the traditional government business. How did you attract startups to join defence procurement?
Our initial challenge was to get startups to believe that defence is serious about engaging them. You are right, the cycle of procurement is so long, that it is almost very challenging for a startup to sustain itself in that system. Yes, we were giving grants, but then a startup is not merely looking for grants. At the end of that cycle of prototype development, they are looking for orders. That is where the real kill is. Once a startup receives an order, particularly one from the defence forces, which are typically quite large, we knew that thousands of other startups would follow suit. This has been our approach from the beginning.
We are pleased to report that two startups have already received confirmed orders and are currently in the process of supplying them. Additionally, 14 other cases have been issued with acceptance of necessity by the Defence Ministry. This proactive approach has been well-received by startups, as acceptance of necessity has even been given to products that are still in the final stages of testing. This serves as an indication that the defence industry is willing to work closely with startups, even if their products are not yet at the 100% readiness level or have not been fully tested. As a result, we received a large number of applications when we launched the Defence India Startup Challenge (DISC).
Another important aspect of our efforts is that the Defence Acquisition Plan (DAP) has been modified to support startups. As you may know, every procurement in the defence is done through the defence acquisition procedure (DAP), which serves as the “bible” for procurement in the defence forces. Till 2018, there was no mention of iDEX in DAPs. This meant that iDEX startups had to go through the routine procurement process, which could take at least two years. In 2020, we were able to include iDEX as an avenue in the defence acquisition procedure. This means that any startup developing a product through iDEX will be considered for procurement and no other agency will be considered.
We also realised that, even after development, the Indian-Indigenously Designed, Developed, and Manufactured (Indian-IDDM) avenue would take another two years to sell the product. As a result, in the last DAP reforms, which were implemented in March-April 2022, the period of 104 weeks was reduced by 80% to 22 weeks. This has been well-received by startups and has encouraged them to continue their efforts in the defence sector.
We have observed that product testing for defence startups has been a time-consuming and tedious procedure. How has iDEX managed to make it hassle-free?
When a startup begins development and considers getting it incorporated into any sector, not just defence, the general idea is that they need to allocate 70% of their time and resources towards development, and the remaining 30% towards liaising and testing to get it inducted. However, in the defence sector, the situation is reversed, with startups having to spend 30% of their time, focus, and resources on development and 70% on testing and liaisoning. This can be a test of patience for startups. That is why the Defence Acquisition Procedure (DAP) has been reformed, but even then, the mindset of the procurement agency also needs to change. Historically, trials took place in several stages in different locations at different periods of time. There had to be a summer trial, a winter trial, and environmental trials that could take months or even years. To address this, a concept of single-stage composite trials has been introduced. While it may not be possible to do everything in one place at one time, the intent is to minimise cost and save time by conducting as much as possible together, to minimise the level of hassles faced by startups.
Next-gen technologies such as AI and ML are gaining momentum, especially for high-end automation. What are your observations on the level of interest in next-generation technologies among defence forces and defence startups?
You are right that the next-generation technologies such as AI and ML are gaining momentum among both service and defence startups. These technologies have the potential to revolutionise the way our forces operate and provide a competitive edge. In the defence sector, AI and ML are being used to improve decision-making, increase situational awareness, and enhance the capabilities of weapons systems. We have seen at least two to three cases where acceptance of necessity has been given for AI-based application procurements by the Services. These are in the fields of intelligence and maintenance. In addition, we are seeing a lot of interest in using AI for geo-satellite imagery analysis, robotics, and AI-based mind detection systems using unmanned ground vehicles (UGVs). These technologies are also being deployed for scanners and swarm UAVs are under development.
One of the most interesting developments is that many of these technologies are being developed in India as first-of-their-kind, custom-made instrumentation systems. For example, a virtual reality-based system that allows users to see outside an armoured vehicle at a certain distance is India's first-ever made, and it is not currently used in any other military worldwide. Additionally, India has developed its first electric loitering munition with a one kg payload warhead, made by a joint venture between Cell Motion and Solar Group. India has also developed its first rescue watercraft, a remotely piloted watercraft, with the Navy already placing orders for 100 units. Furthermore, in the satellite imagery analysis space, an IIT Delhi startup is doing very promising work.
There is considerable startup interest in cybersecurity, drones, and the utilisation of technology, but defence space remains a black box for startups. Why is this the case?
You are right, the biggest elephant that we have is defence space. The challenge in the defence space sector is that there is very little information available, even to the user, about what is required, and what the specifications of those requirements are. ISRO primarily deals with civilian applications, while our focus is on creating a deterrent rather than being aggressive, but we need to know the specifications of what we actually want.
Another challenge is that not many startups and SMEs are working in this domain. The third challenge is funding. Typically, our contracts are 18 to 24 months, but we readily accept that any space-related challenge will take much longer than that. And due to funding constraints, we could not limit it to iDEX alone. So, we have divided our ‘Challenges' among iDEX and the MAKE procedure, which is also one of the entities used in defence for development and procurement. Now that we have involved MAKE, we have to synchronise our efforts with them to ensure that deliveries are streamlined and taking place together.
We need to have a sufficient talent pool to assess the applications. And after that, our very important role is to guide the development process. This is a challenge, not just for us, but also for our incubators. The DefSpace Mission has already been launched, but it is also part of our future, as it will continue for at least three to four years. That, along with cybersecurity, will be our immediate next ‘Challenge'.
Additionally, just before the DefSpace Mission, we launched a set of seven different Navy ‘Challenges'. This is currently taking up about 60% of our focus and manpower, and we are targeting to close most of those cases within this coming year. So, you can see that the Navy and the defence space constitute about 75-80% of all our ‘Challenges'. All these 80% of ‘Challenges' have been launched within the last six months. Therefore, our scaling up has been exponential. And it becomes a challenge to maintain the level of quality that we were providing earlier.
How many startups has iDEX engaged with to date?
iDEX has received a large number of applications, approximately 6000, and we have chosen to provide grants to around 300 startups. Currently, iDEX is engaged with almost 200 startups, and recently we celebrated our 150th agreement. It took us three years to sign our 100th contract, and only four more months to sign our 150th. We plan to reduce the time frame for the next 200 agreements.
iDEX has implemented three levels of participation for startups: the first is an open-base challenge, where the problem statement comes from the innovator; the second is the Defence India Startup Challenge (DISC) where iDEX presents the challenge to startups; and the third is a Prime Challenge, which is similar to the DISC challenge, but with a different funding structure. The DISC challenge is for a grant of Rs 1.5 crore and the Prime Challenge is for a grant of Rs 10 crore, with an equal matching contribution required from innovators.
To improve our reach to startups and understand the problem statements of defence forces, we have taken two major steps. First, iDEX has dispatched personnel to forward regions to understand the equipment being used by defence forces, the challenges they face, and their need for customisation. Second, iDEX has opened a window for open challenges, where anyone can apply for a solution they have developed. If the solution is accepted by the Services, the startup can be declared a winner. iDEX has received positive responses for open challenges, but many of the applications were not limited to defence. They were also relevant for internal security, including the Ministry of Home Affairs, Border Security Forces (BSF), and Assam Rifles, among others. We hope that other departments will either create their own mechanisms like iDEX or join our platform, as iDEX already has a strong base of startups.