New procurement policy is well-meaning, with a clear focus on indigenisation. Test will be in the execution.
- Defence Minister announced the contours of the long-awaited new defence procurement procedure (DPP)
- V.K. Aatre Committee, formed to recommend policy on selection of strategic partners in defence manufacturing, is expected to submit its report this week.
- The policy is critical for the business development plans of India’s top private defence manufacturers.
- The defence ministry has accepted 90 per cent of the recommendations made by Dhirendra Singh committee.
- Two major highlights of the new DPP – the creation of a new category called the “IDDM” or indigenously designed, developed and manufactured platforms.
- This will get top priority for buying equipment and incentivise domestic manufacturing .
- Raising of the value of contracts for 30 per cent offsets from Rs 300 crore to Rs 2,000 crore.which satisfies foreign vendors.
- Policy on blacklisting of defence suppliers and authorised defence agents will also be unveiled along with the DPP.
- Those policies are critical to creating a well-defined landscape for the operation of both Indian and foreign defence manufacturers.