A few days ago, the Indian Army announced that it is scrapping what was to be the world's largest procurement of assault rifles, involving a purchase of over 65,000 multi-calibre weapons and domestic production of over another 113,000 at an estimated budget of Rs 4,850 crore. A seven-year-long exercise in providing Indian troops with a modern rifle thus came to a fruitless end.
In May this year, the Comptroller and Auditor General tabled a report to Parliament on its review of ammunition management in the armed forces: it found that the army was able to stockpile only 20 days worth of ammunition as against the required 40 days reserves. As of March 2013, the army was critically short of around half of the different types of ammunition it needed. In the CAG's opinion, "the critical shortages impacted the operational preparedness and training regimen of the Army." This was because the ordinance factories weren't producing enough, the defence ministry wasn't able to purchase enough, the quality control was not good enough and supply chains were not being managed well enough.
In other words, the armed forces are short of guns and bullets. Mercifully, a "two-front war" that our troops are asked to prepare for is unlikely, but the ability to prosecute even a half-front war successfully is in question. Note, this is not about some high-technology platform like an aircraft carrier or a long-range missile: it's about replacing the foot-soldier's frontline weapon and about providing adequate weapons to frontline fighting units. Though Defence Minister Manohar Parrikar has spoken of significant improvements in the ammunition reserves and promised a closing of the gap by end-2016, a review of the supply chain does not inspire confidence that the shortfall will be bridged in that timeframe.
So it's not only that India's production/procurement of tanks, missiles, field guns, aircraft and carriers that is in a mess. It seems we do poorly even in relatively simple purchases like rifles and ammunitions. It is normal at this point to blame everything on corruption, middlemen and scams. That is, of course, generally true. But corruption is almost always a symptom of a deeper malaise. Yet, because every government tries to tackle this symptom, it ends up exacerbating it while ignoring the underlying, systemic problem.
Consider how the procurement process works. The defence ministry compiles a Long Term Integrated Perspective Plan (LTIPP) for a horizon of 15 years. This is essentially a sum of the requirements drawn up by the army, navy and air force. Under the LTIPP, there are five year plans, under which, in turn, are annual acquisition plans. The qualitative requirements are framed by the three services. The Defence Acquisition Council approves the LTIPP and the five year plans, and the Defence Procurement Board approves the annual acquisition plans. Procurements are carried out under the procurement policies that are complex, cumbersome, controversial and amended often. Notice that the Cabinet Committee on Security is not involved in the process, which means that the finance ministry is not in the loop in all these plans.
Even if the planning process works as intended, it still means that the defence ministry merely adds up the individual requirements and goes about buying them. This is sub-optimal: consider a particular emerging threat that everyone agrees India needs to be prepared for. The army, navy and air force then prepare their own strategies and operational plans, for which they draw up a list of requirements. At the back of their minds, they know that the defence budget is more-or-less divided in a fixed ratio among them.
The defence ministry then tries to buy all these items. Even when it does not lose its way in the maze of rules it has created to reduce corruption and increase indigenisation, there is very little inter-service coordination in the preparation of the shopping list. The Integrated Defence Staff headquarters is too weak relative to the individual service headquarters to harmonise the plans and purchases.
This means we have both inclusion and exclusion errors. As a whole, India's armed forces might be buying too many of the same things, and might missing some items that are necessary for effective national defence. We will never know what's being duplicated and what's missing until the process of planning is "joint" from the root.
As we see in practice, the current method produces unsatisfactory outcomes, all the more because the procurement policy is famously byzantine and the domestic defence production eco-system is unable to match up due to a whole set of problems. The visible symptoms are a shortage of equipment and excess of corruption.
The only way is for the LTIPP to be prepared jointly among the three services, even without waiting for a Chief of Defence Staff to be appointed. More than an omnibus procurement plan, the LTIPP should answer how India ensures that the gestation time of the defence capacity is adequately ahead of the gestation time of the threat. Finally, the plan must be endorsed by the Cabinet. Reforming the planning process will transform India's defence preparedness.
What should concern the Indian citizen is not the fact that the world's biggest assault rifle purchase was scrapped. What should is the fact that the tender was for a type of rifle that has never been produced.
The writer is co-founder and director of the Takshashila Institution, an independent think tank and school of public policy
Disclaimer: These are personal views of the writer. They do not necessarily reflect the opinion of www.business-standard.com or the Business Standard newspaper
