Procedures to reduce delays
Defence Acquisition Council to take all decisions Generic requirements to be placed on Internet
NEW DELHI: The Union Government on Wednesday announced radically revised defence procurement procedures to reduce delays and eliminate corruption in vendor selection.
The new policy comes as the country is poised to procure defence equipment worth over Rs. 1 lakh crore in the next five years.
The new norms seek to involve Indian companies in designing and producing hard-to-obtain equipment, allow closure of dead-end projects and ensure that the cascading effect of local taxes does not make the companies' products costlier than foreign equipment.
"It is a moment of great personal satisfaction for me as it marks the completion of the policy reforms process initiated by me two years ago," said Defence Minister Pranab Mukherjee at a news conference.
Outlining the salient features of the policy that will take effect from September 1, he said the Defence Acquisition Council (DAC) would take all major decisions collectively and generic requirements for equipment would be placed on the Internet. Vendors can register themselves online.
There would be joint meetings with vendors before and after field trials. They would be told about shortcomings, if any, in their products.
The policy would address the need for a procedure to acquire equipment based on local research and development.
Two companies would be identified and encouraged to develop prototypes and one would be selected for induction into the armed forces.
"This would pave the way for increased participation of industry in the defence sector and for attaining the goal of self-reliance in defence production," said Mr. Mukherjee.
The previous Government's fast track procedure, framed after the Kargil War, had been revised by adopting a "top down" approach and the DAC would take all critical decisions.
The procedure for warship building had also been reviewed, so that companies could integrate foreign systems with indigenous ones. This would minimise time and cost overruns in the construction of naval ships, he said.
The new norms take into account observations by the Central Vigilance Commission and the Comptroller and Accountant-General of India.
"The Defence Procurement Policy-2006 and Defence Procurement Manual-2006 is now a comprehensive document. The Offset Policy is firmly in position. The long pending request of industry for a level playing field has been addressed. With these measures, we have effectively opened the doors for industry to participate in defence research, development and production," said the Minister.