Guns, tanks displayed as India spends on defense

Hundreds of top defense companies displayed everything from guns to tanks Monday at the largest arms fair in Asia as India plans to spend billions of dollars to upgrade its military hardware.

The country is becoming one of the largest military buyers in the world as its economy grows and it replaces outdated equipment, much of it Soviet-era relics, to supply a 1.3 million-person army.

Some 650 defense companies are participating in DefExpo-India 2010 through Thursday. The United States, Israel, Russia, France and Germany are among countries represented, and the companies attending include Boeing, Lockheed Martin, Thales and BAE Systems.

In the current fiscal year, which ends March 31, India plans to spend $26 billion (1.05 trillion rupees) on defense, a 10 percent increase from a year earlier. The country earmarks about 40 to 45 percent of this budget on purchasing new equipment.

Currently about 70 percent of the country's military hardware is imported, a figure India hopes to reduce.

"Our ultimate goal is self-reliance and we will give more opportunities to Indian companies," Defense Minister A.K. Antony told reporters at the fair.

State-owned companies long dominated the domestic defense market, but in recent years the government has been encouraging private sector participation.

At this year's fair the largest contingent - 350 companies - is from India, up from 200 in 2008, Antony said.