Defence Industry

New defence procurement policy gets mixed reaction from industry

The defence industry has expressed mixed reactions to the proposed Defence Procurement Procedure of 2020 (DPP-2020), which the Ministry of Defence (MoD) released in draft form on February 20.

The MoD has invited suggestions and recommendations by April 17. After that, DPP-2020 will be promulgated and will govern all acquisitions initiated thereafter. It will supersede DPP-2016 as the MoD’s handbook for purchasing of weapons, warships and equipment from the defence capital budget.

A Business Standard survey of small, medium and large defence firms reveals broad agreement that DPP-2020 has been hurriedly finalised and uploaded. Important annexures and appendices have been left out and even page numbering has not been done.

Like successive DPPs since the first in 2002, the draft DPP-2020 is longer and more complex than any other that preceded it. This despite the MoD’s stated aim of simplifying acquisition procedures to speed up the military’s modernisation. A 719-page long, the draft DPP-2020 is far wordier than its predecessor — the 430-page DPP-2016, which has, over the past four years, been amended 47 times for business process reengineering.

This is so, even though the draft DPP-2020 excludes an entire chapter on the Strategic Partnership Model of procurement since no changes are being recommended to the version in DPP-2016.

Abhishek Jain of software firm Zeus Numerix sees a change of soul in DPP-2020. Unlike previous DPPs, which he says primarily laid out guidelines on procuring foreign equipment, this time around there is a full chapter on indigenous innovation, including how single vendor purchase is acceptable for an innovative product developed by an Indian company, which has 50 per cent indigenous content.

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