Defence Acquisition Procedure 2020 amended to promote ‘Make in India’ & ‘Aatmanirbharta’ in defence

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Defence Acquisition Procedure 2020 amended to promote ‘Make in India’ & ‘Aatmanirbharta’ in defence

All modernisation requirements of the three Services & Indian Coast Guard to be indigenously sourced irrespective of nature of procurement

Requirement of Integrity Pact Bank Guarantee dispensed with to reduce financial burden on domestic industry

By PIB Delhi

To further promote ‘Make in India’ and ‘Aatmanirbharta’ in defence and enable Ease of Doing Business, Defence Acquisition Procedure (DAP) 2020 has been amended based on the approvals accorded by Defence Acquisition Council (DAC) in respect of the following:

· Going forward all modernisation requirements of the Defence Services and Indian Coast Guard are to be indigenously sourced irrespective of the nature of procurement. Import of defence equipment/sourcing from Foreign Industry of capital acquisitions should only be an exception and undertaken with specific approval of DAC/Raksha Mantri.

· As advised by the Ministry of Finance and to reduce financial burden on the Indian Defence Industry whilst maintaining financial safeguards, requirement of Integrity Pact Bank Guarantee (IPBG) has been dispensed with. Instead, Earnest Money Deposit (EMD) will be taken as a bid security for all acquisition cases with Acceptance of Necessity (AoN) cost more than Rs 100 crore. EMD will be valid for the selected vendor up to signing of contracts and returned to remaining vendors post declaration of selection. Post contract, Integrity Pact will be covered through the Performance Cum Warranty Bank Guarantee (PWBG). Further, as per extant Government of India policy, EMD is not required from Micro and Small Enterprises (MSEs).

· To encourage wider participation and broad base indigenous defence manufacturing sector in the country, the total order quantities in acquisition cases are to be split between shortlisted vendors, wherever viable. Further, the other technically qualified bidders who have not been awarded contract will be issued a certificate by the Services indicating that the product has been successfully trial evaluated, to facilitate vendors to explore other markets.

· To create an ecosystem which fosters innovation and encourages technology development in Defence by engaging R&D institutes, academia, industries, startups and individual innovators, the iDEX framework was launched by Prime Minister Shri Narendra Modi in April 2018. Existing provisions of DAP 2020 links the procedures of Staff Evaluation, CNC and award of Contract for IDEX procurement, to the procedure in ‘Buy (Indian- IDDM)’, which entails a long period of approximately two years before placement of the order. To enable the budding startup talent pool of the country to contribute towards the twin mantras of self-sufficiency and indigenization, the procurement process under iDEX procedure of DAP 2020 has been simplified. With this simplification, time taken from grant of AoN to signing of contract will be reduced to 22 weeks.

· Make-II procedure of DAP-2020, involving indigenisation of defence equipment for industry funded projects at prototype development stage, has been simplified by incorporating Single Stage Composite Trials of prototypes and dispensing off with quantity vetting and scaling for initial procurements in the delegated cases. Post simplification, the timelines in Make-II procedure will be reduced to 101-109 weeks from an existing total time-period of 122-180 weeks.

About Post Author

Suman Munshi

Founder Editor of IBG NEWS (15/Mar/2012- 09/Aug/2018). Recipient of Udar Akash Rokeya Shakhawat Hossain Award 2018. National Geographic & Canon Wild Clicks 2011 jury and public poll winner. Studied Post Graduate Advance Dip in Computer Sc., MBA IT,LIMS (USA & Australia), GxP(USA & UK),BA (Sociology) Dip in Journalism (Ireland), Diploma in Vedic Astrology, Numerology, Palmistry, Vastu Shastra & Feng Sui 25 years in the digital & IT industry with Global MNCs' worked & traveled in USA, UK, Europe, Singapore, Australia, Bangladesh & many other countries. Education and Training advance management and R&D Technology from India, USA, UK, Australia. Over 30 Certification from Global leaders in R&D and Education. Computer Science Teacher, IT & LIMS expert with a wide fan following in his community. General Secretary West Bengal State Committee of All Indian Reporter’s Association
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