New Delhi, Feb 06: India today invited higher foreign direct investment in the defence sector in order to meet rising domestic requirements as well as make a greater thrust in export markets. Speaking at the ongoing Defexpo 04 here, Minister of State for Defence Chaman Lal Gupta said the government was making efforts for attracting greater FDI flows and investment by non-resident Indians and overseas corporate bodies in the defence sector. ''The basic objective to allow FDI in the defence sector is to pool capital and induct latest technology to manufacture state-of-the-art equipment to meet the requirements of our armed forces and also enter export markets at a significant scale,'' Gupta said. In May 2001, the government had decided to open the whole defence production to the private sector, subject to licensing. Also, FDI up to 26 per cent has now been permitted to facilitate infusion of foreign technology and additional capital. The minister stressed that the private sector should also play a more pro-active role to fulfill India s defence needs and work in close synergy with the public sector undertakings. ''It is important to note that in 2002-03, defence PSUs outsourced to the extent of 30 per cent from the private sector whereas in case of ordnance factories, it was about 80 per cent,” he said. However, he added that the PSUs, which had been contributing to the defence sector since the country s independence, could not be ignored in the race for attracting private participation. “The government, having made huge investments in the private sector, cannot allow the installed capacity to remain idle. We are for getting the best value for money that indirectly implies that competitive prices should be the basis of procurement,'' he said. ''Therefore, we feel that a healthy competition is developed between the public and the private sector and even envisage a joint effort from both in enhancing capacities for development of sophisticated items,” he added. Bureau Report