The long- awaited Defence Procurement Procedure (DPP) with focus on ‘Make in India’ initiative is expected to be delayed again.
The DPP-2013 is being amended based on the draft submitted by Dhirendra Singh-headed committee of experts which had submitted its report last year. The committee suggested a task force of 10 members under Dr Atre to recommend the parameters based on which ‘Strategic Partners’ could be identified by the MoD. The Dr Atre Committee has not yet submitted its report.
“The task force under Dr Atre has to suggest partners that could be nominated as the Indian partners who would manufacture (and later maintain) the equipment in India in Buy and Make cases (Buy from the foreign OEM a certain quantity followed by manufacturing of the remaining quantity in India with ToT from the OEM),” explained a senior MoD official.
The Dhirendra committee had apparently made this recommendation to ensure private sector participation in such cases on a long-term basis (as they could possibly be involved in providing life cycle support for the equipment, apart from being involved in upgradation, etc.).
Explaining the procedure of implementing the amendments, officials say there there is nothing laid down but, “once the report is submitted, MoD will examine it and take a call on whether to accept the recommendations and incorporate them in the new DPP.”
“The ongoing contracts will not be impacted by the delay. The cases in which Acceptance of Necessity (AoN) has already been accorded may also not be impacted, unless a decision is taken to apply the decision on strategic partners retrospectively,” points out Amit Cowshish, a former financial adviser (acquisition), MoD.
“There is no point in waiting for the report to be submitted, which will be followed by another couple of months of deliberations before necessary changes are introduced in the DPP, assuming, of course, that the recommendations will be acceptable to the industry,” he added.
However, “not every case will require a Strategic Partner. Therefore, at least those capital procurement cases which do not require such partner can be processed in accordance with the provisions of the new DPP,” he adds.