After the thumbs up from India Inc to the Defence Procurement Procedure (DPP), Defence Minister Manohar Parrikar today sought to woo global investors, saying the newly unveiled policy provides a level-playing field for all stakeholders.
"The DPP has raised expectations. I only consider it to be a level-playing field and nothing beyond that. Many of the ideas which could have been executed could not be done so because of the earlier DPP," he said at a Global Investors' Summit organised here by ASSOCHAM on the sidelines of the ongoing Defence Expo at Betul -Naqueri in south Goa.
The minister told the delegates that the new DPP removes several "shackles" and frees the department from procedural tangles.
"The DPP saw around 3,000-4,000 hours of work, which includes reading, re-reading," said Parrikar.
The Defence Minister had unveiled the new DPP on the first day of the Defence Expo yesterday and its text is now available online.
The minister said, "DPP is just a warm up, the final game is yet to begin. Through DPP 2016, we have attempted a good draft. Neither do I claim that we are experts in everything, nor is it that everything we work out is perfect."
He told the industry players that their suggestions and recommendations are welcome. "May be after six months, we will see how the new DPP functions."
Parrikar said, "In the absence of new DPP, whatever is in progress is generally under the old DPP. We have tried to make mini modifications, we have tried to work out solutions to solve the bottleneck. We are for the first time analysing the status of various AONs (Acceptance of Necessity) granted."
He further said, "When I took over, there were 326 AONs worth about Rs 5,09,000 crorevalue pending of which eight were more than 10-years-old.
"There were almost 77 AONs which were more than five years old. We are working on these AONs and will eliminate the items which are today out of technology or not required. This process has been undertaken for the first time," he said.
"By the time the new DPP starts taking effect, we will be
clear on exactly how we are going to proceed, including on the financial aspects of the defence budget," Parrikar said.
Reacting to criticism of the defence budget, the minister said "unnecessary comments" are being made without any attempt to understand the aspects related to defence procurement.
"What I am paying today, 85 per cent of it I have contracted long back. If I have contracted some fighter five years back, I pay for it today. This is termed committed liability in defence capital acquisition," he explained.
"What has been ordered five years back is actually being paid for today. What I ordered last year and this year, only 10-15 per cent payment has been done. Even if I order (purchases worth) Rs 1,52,000 crore, the real payment hardly exceeds Rs 15,000 crore for future procurement," Parrikar explained.
