Transparency in the new defence procurement policy

It will ensure developing a robust indigenous defence sector

With many defence deals mired in controversies, the Union government on Saturday promulgated a new policy that aims at enhancing transparency and probity in purchases.

“The Defence Procurement Procedure (DPP) 2013 aims to balance the competing requirements of expediting capital procurement, developing a robust indigenous defence sector and conforming to the highest standards of transparency, probity and public accountability, while laying a strong emphasis on promoting indigenisation and creating a level playing field for the Indian industry,” the Ministry of Defence (MoD) said in a release here.

Last month-end, Prime Minister Manmohan Singh admitted that the government was conscious of the fact that adequate defence preparedness was “critically dependent on sound acquisition policy.”

The new procedure gives the first right of refusal to Indian vendors to promote indigenous industry.

In his remarks in the foreword of the new policy document, Defence Minister A.K. Antony expressed the hope that “the defence industry as well as the procurement agencies will find the DPP-2013 to be a ‘progressive step’ aimed at giving impetus to indigenisation, creating a level playing field and expediting the procurement process as a whole.”

Terming defence acquisition a “complex” process, he said it needed to balance the competing requirements of expeditious procurement, development of an indigenous defence sector and conformity to the highest standards of transparency and probity.

In the new policy, the MoD has accorded a “higher preference explicitly to the Buy [Indian], Buy and Make [Indian] and Make categorisation, besides bringing further clarity in the definition of the ‘Indigenous Content’ and simplifying the Buy and Make [Indian] process.”

The DPP 2013 stipulates that if forces have to procure from foreign vendors under the Buy (Global) category, they will have to justify “not considering the other higher preference categories. This is expected to give a stronger impetus to indigenisation.”

Seeking to expedite the procurement procedure, the new policy has reduced the validity of Acceptance of Necessity (AoN) from two years to one year with a stipulation to freeze the Service Qualitative Requirements before the accord of the AoN.

“A higher delegation of financial powers to the Service Headquarters and the Defence Procurement Board (DPB) has also been made. Together, these measures are expected to make the procurement procedure more efficient and reduce delays,” the MoD release said.

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Policy gives first right of refusal to Indian vendors to boost indigenous industry

Antony hopes policy will be a ‘progressive step’