Defence Ministry assuages procurement norms/regulations

The defence ministry has relaxed its procurement norms, making it easier for Indian companies, including start-ups, to supply equipment and other products to the armed forces. Under the so-called Make II category of the Defence Procurement Procedure, (where no government funding is involved in production) industries, can now make suo motu proposals to the armed forces, offering to supply products based on their own assessment of requirements. The defence ministry also said that start-ups will now be allowed to develop equipment for the Indian Armed Forces. To hand-hold industry and start-ups, the government will now set up project facilitation teams to provide technical inputs, trial infrastructure and other facilities as required by the vendor, and also the teams would act as the primary interface between government and the industry during the design and development stage.

The defence ministry said, that even if a single individual or firm offers innovative solutions, Service Headquarters will now have the option to accept and process the vendor’s development initiative and also the Service Headquarters will be further allowed to hire domain experts/consultants from private sector to increase outreach and enhance awareness among the industry. Most importantly, there will be no foreclosure of project after the project is sanctioned, except on default by the vendor, to ensure that the successful vendor has assured orders, which could mean the small start-ups may no more need any ratings from credit rating agencies, which in turn will help the SMEs (small and medium enterprises).

The Defence Acquisition Council (DAC) also cleared procurement of assault rifles and carbines worth Rs 3,547 crore on “fast track basis” to meet the immediate requirement of troops deployed on the borders. Also the defence minister has cleared the proposal, under which, 72,400 assault rifles and 93,895 carbines will be procured, reckoning to address the shortage of weapons for the armed forces.

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