Defence Minister Rajnath Singh on Wednesday called for the need to come up with new innovative methods in order to increase the value of money spent on the country’s security needs. Inaugurating the three-day International Conference on Defence Finance and Economics in the national capital the minister pointed out that the legal and procedural defence-finance framework is an integral part of a mature state system.
He observed that the frameworks that include expenditure control as per guidelines, financial advice by professionals, audit, payment authentication mechanism, make sure that defence spending does not cross the limit that is allocated in the budget and that the full value of money is realised.
Even as the armed forces of the country need a superstructure of defence ecosystem including R&D organisations, industries, soldier welfare organisations, among others, they also need a well-funded system with a robust architecture for proper use of financial resources, Rajnath Singh said.
The minister felt that while there is a difficulty in applying the economic concept of full value of money in defence expenditure, there is no visible stream that is visible. He also stressed the need to follow the competitive bidding through open tender in defence procurement.
“In the case of procurement of defence platforms/equipment, either under capital or revenue route, the gold standard of Open Tender should be adopted to the extent possible. A competitive bid based procurement process, which is open to all, is the best possible way to realise the full value of the public money being spent,” he said.
Rajanth Singh further added, “There would be some rare cases when it may not be possible to go for an open tender process. Such instances should come under exceptions and exceptions should not become the rule.”
Also read: LAAD 2023: MKU to unveil MK-19 Grenade Launcher and create wall of fame, says VP International Sales
Speaking at the event, the minister also pointed out that the government has formulated Blue Books in the form of Defence Acquisition Procedure 2020 that play an important role in capital acquisition, as also Defence Procurement Manual for revenue procurement and Delegation of Financial Powers to Defence Services.