Why devolving more financial powers to DRDO is good

By: |
New Delhi | June 29, 2018 2:45 AM

Devolving more financial powers to DRDO is good, but more must be done if it is to become efficient

Empowering DRDO

The Centre devolving greater financial power to the Defence Research and Development Organisation (DRDO) will perhaps give the body some much-needed autonomy. To “enhance its (DRDO’s) efficiency and effectiveness”, the defence ministry has reposed greater decision-making powers with the secretary, defence research and development—who serves as DRDO chief—and its seven directors-general (DGs) who serve as cluster-heads for the broad areas of DRDO’s research-focus. The DRDO chief can now sanction projects/procurements up to Rs 150 crore (versus the `75 crore cap so far), while the DGs can sanction projects up to Rs 75 crore (up from `50 crore). However, India continues to be the world’s largest defence equipment importer while its defence research body has been pumping resources into developing dental implants and mosquito repellents. In fact, the Rama Rao Committee, in 2008, had asked the government to limit the DRDO’s research focus to just “core technologies” of “strategic importance”.

In March, Parliament’s standing committee on defence, headed by BC Khanduri, hauled up the DRDO for serious delays in projects and wastage of tax-payers’ money by ditching projects mid-way. The panel, in fact, suggested that independent agencies be brought in to conduct “scientific, technical and concurrent audit(s) of every ongoing project.” It said that project delays have become a “part and parcel of DRDO’s functioning”, citing how the LCA project was originally supposed to be completed by 2008, but, the date of completion has now been revised to June 2019. Similarly, the Kaveri aero engine project was supposed to be completed by 1996, but was only completed by 2009. Such delays not only have a cost implication, but also keep the armed forces waiting for critical capabilities. The panel said that it “understands that research activity is an open-end programme and closing a project midway is a possibility”, but, this should not be allowed to become a regular practice, as it has with DRDO. The DRDO’s own dysfunction aside, the fact is that it is also hobbled by lack of adequate funding—it receives just 5-6% of the defence budget, while the comparable figure for China is 20%. So, greater decentralisation is certainly welcome, but, the government needs to do much more if DRDO is to become truly efficient.

Get live Stock Prices from BSE, NSE, US Market and latest NAV, portfolio of Mutual Funds, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.

Financial Express is now on Telegram. Click here to join our channel and stay updated with the latest Biz news and updates.

Next Stories
1An Indian SpaceX: Policy to tap private sector talent for space taking shape in India
2EPFO investments in market: Second-guessing everyone will kill all initiative
3GST compensation: Why the Centre needs to yield a little more