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MYS Southeast Asia

Defence procurement in
Malaysia.

Malaysia replaced its offset regime with something broader in 2014. The Industrial Collaboration Programme, administered by the Technology Depository Agency under the Ministry of Finance, reaches past traditional offset into investment, market access, knowledge transfer, human capital and R&D. The threshold is low by regional standards — RM 50 million for a foreign contractor — which means the obligation attaches to contracts many suppliers would treat as routine, and it is negotiated with the Ministry of Finance's agency rather than with the defence customer. SIRAT analyst desk · reviewed 2026-09-05

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ProgrammeIndustrial Collaboration Programme
Administered byTechnology Depository Agency
Introduced2014
Foreign thresholdRM 50 million
Local thresholdRM 100 million

At a glance

ProgrammeIndustrial Collaboration Programme (ICP), introduced in 2014 as successor to the offset scheme
Administered byTechnology Depository Agency, established under the Ministry of Finance
Buying ministryMinistry of Defence (MINDEF)
Threshold — foreign contractorRM 50 million
Threshold — locally based contractorRM 100 million
Qualifying activityLocal content, investment, market access, transfer of knowledge or technology, human capital development and R&D
01

Who administers the obligation

The Technology Depository Agency, established under the Ministry of Finance, administers and monitors every ICP activity and enforces compliance with the Malaysian ICP Management Framework. That places the industrial negotiation outside the defence ministry — a supplier who prepares only for MINDEF has prepared for half the process.

02

What is expected back: industrial collaboration

The Industrial Collaboration Programme was introduced in 2014 and deliberately reaches beyond traditional offset. Qualifying activity includes local content, investment, market access, transfer of knowledge or technology, human capital development and research and development, which gives a supplier more routes to discharge an obligation than a pure offset regime would.

03

When it applies

An ICP obligation is triggered at RM 50 million for a foreign-based contractor and RM 100 million for a locally based and owned contractor. The gap is deliberate and it is one of the clearest arguments in the region for bidding through a Malaysian entity.

Compiled from the published material of the Technology Depository Agency and the Malaysian Ministry of Defence, last reviewed 2026-09-05. A public reference note, not an assessment. Something wrong or out of date? Tell us.

Malaysia,
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