Friday, December 18, 2015

New Defence Procurement Procedure and Defence Procurement Manual, 2016 on the Anvil: Def Min Manohar Parrikar

The Defence Minister Shri Manohar Parrikar today said that MoD will soon be coming out with a new DefenceProcurement Procedure as well as the DefenceProcurementManual, 2016. Addressing the Consultative Committee attached to his Ministry in New Delhi the Defence Minister said that the currentDefence Procurement Procedure is under amendmentand is under the consideration of his Ministry after a Committee of experts headed by Shri Dhirendra Singh had submitted its report. The Committee was appointed to evolve a policy framework to facilitate Make in India in defence manufacturing, align the policy evolved with DPP-2013 and suggest requisite amendments in DPP-2013 to remove bottlenecks in the procurement process and also simplify/rationalize various aspects of defenceprocurement. Alongwith this, the Defence Procurement Manual is under the process of internal vetting and is expected to be finalized by end June, 2016. 

The DPP has evolved to DPP-2013 through an iterative process since the first DPP in 2002 (2003, 2005, 2006, 2008, 2011 and 2013). It encapsulates the experience gained in implementing the procurement process over the years, feedback from the stakeholders, i.e. User Services, Quality Control and Maintenance Agencies, Defence Finance, Administrative Wing and Industry. Amendments are carried out continuously keeping in view the requirements of all stakeholders. 

In DPP-2013, the acquisition of Weapon Systems and equipment for the Armed Forces flows from the Long Term Integrated Perspective Plan (LTIPP). The current LTIPP spells out the capability desired to be achieved by the Armed Forces over 15 years duration (2012-27) The Categorization Committees while considering categorization of all capital acquisition under the Defence Procurement Procedure (DPP), follow a preferred order of categorization, in decreasing order of preference, as indicated below: 

(i) Buy(Indian) 

(ii) Buy & Make (Indian) 

(iii) Make 

(iv) Buy & Make 

(v) Buy (Global) 

This hierarchy of Categorization clearly marks a shift towards indigenous equipment. Department of DefenceProduction with its OFs and DPSUs has been a major instrument to foster Indigenization. However, over the last few decades, provisions such as “Make” and BUY+Make(Indian)” categories have been introduced to facilitate the participation of the private sector in defence production. 

Taking part in the discussion, Members of Parliament suggested that Government should give incentives under the Buy(Indian) and Buy & Make(Indian) categories. They also said that PSUs should also be allowed to bid for Buy(Indian) category and that offsets should be in terms of overall requirements of users. 

The Members of Parliament who attended the meeting included Shri Pinaki Mishra, Prof. Saugata Roy, Prof. A. SeetaramNaik, Shri Rajeev Chandrasekhar, Dr. Mahendra Prasad, Shri T.K. Rangarajan, Shri Bhupender Yadav, and Shri Samsher Singh Manhas. 

The DefenceSecretary Shri G. Mohan Kumar, Defence Production Secretary Shri Ashok Kumar Gupta, DG, DRDO Shri S. Christopher and other senior officials of MoD attended the meeting. 

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