New defence procurement policy from April 2

At Make in India event, the Defence Minister said that the new policy will ensure modernisation of defence forces

Defence Minister Manohar Parrikar said the DPP would give priority to indigenous manufacturers under the Make in India initiative but it wouldn’t be a mandatory condition to award contacts. The new policy would modernise the defence forces.

Parrikar said, “The DPP will have a new category of indigenously designed, developed and manufactured (IDMM) as the most preferred category for procurements. It aims to boost domestic private and small-scale industry. The government promises to make the defence market more lucrative for Indian industry.”

The policy would focus on reducing delays in procurements by eliminating repetitive procedures.

The minister said the government would include skill development in the guidelines, to be issued in two months, for offsets. “This is necessary as over 100,000 skilled persons will be required in view of a proposed increase in the production of defence aircraft and helicopters. Even though there are a large number of youth who need jobs, they lack necessary skills.”
 
Parrikar said the government had attempted to bring in transparency, especially in defence procurement. He said the Indian Air Force was not keen on procuring 20 Tejas single-seat, single-engine, lightweight, high-agility supersonic fighter aircraft but now an order for 100 had been placed. “Tejas travelled to Bahrain to participate in an air show and it has been accepted by the world. When our participation was accepted, some withdrew from the air show.”

The minister said if the system was cleaned up, defence expenses can be reduced by 25 per cent without sacrificing quantity, quality and the requirement of the forces. “You can save money by better discounts,” he said.

Parrikar said the government had issued 370 licences and signed 40 to 50 MoUs in the defence sector.

On the Indian economy, especially in the wake of the Make in India initiative, Parrikar said the economy was expected to grow at least by eight per cent next year against a prediction of 7.5 per cent.