The defence sector is set to do business in a way that is subtle and pronounced. Giving a spin to the Make-in-India pitch of the Narendra Modi government, defence minister Manohar Parrikar has made a strong case for getting Indian institutes like IITs on board.

This, he said, will reduce the country's dependence on imports and will do away with the system of blacklisting firms.

The policy of blacklisting companies had been used to "create a situation of single tender." That is, rivals were blacklisted to suit certain companies and this had left the ministry with hardly any option in many areas, Parrikar said.

In a free-wheeling interaction with the faculty and alumni at IIT Bombay campus, where he was felicitated as a distinguished alumnus, on Sunday, Parrikar said, "We are in a mess that I can't spell out".

Parrikar said he was keen to strengthen defence research base through tie-ups with institutes like IITs for two key: to reduce costs and dependence on imports and to ensure self-reliability in case of emergencies.

"None of the systems – be it American, Russian or Israeli – are free from trouble at all times. Our import bill in defence last year was $6 billion. Most countries do not rely so much on imports," he said.

While pointing out that there was no concrete decision on any of these ideas, he said policies giving shape to his ideas would be in place soon.

"By May-June next year, there will be a lot of synergy; the direction will be clear." A platform for interaction with senior defence personnel, for seamless applicability of research projects, would be created even earlier than that, he said.

Indicating his dissatisfaction with DRDO, Parrikar said that while the defence research organisation gels well with the navy, it is not working as well in most other programmes. The involvement of IITs will "put defence acquisitions in a different orbit," he said.

Parrikar said he would work out an alternative way of penalising errant contractors and companies, so that it doesn't affect future purchases. Secondly, middlemen would be weeded out. "You won't find any kickbacks in my regime," he said.

Prof S P Sukhatme, former chairman of the Atomic Energy Regulatory Board, said the two primary areas of cooperation with academic institutes like IITs would be the Light Combat Aircraft (LCA) and the Main Battle Tank (MBT).

The Arjun MBT was a good idea, but its execution and management were not that good, he said. Tejas, an LCA, was finally into production after decades. Cold weather protection rooms, night vision and bullet-proof equipment are some of the other areas for collaboration.

Modi's 'Make-in-India' mission, in one shot, sought to create employment, technology enhancement, and strengthening the country's capabilities on all fronts, Parrikar said.