Why DPP is needed?
· advanced and distinctive call making: Defence acquisition has bound distinctive options like provider constraints, technological quality, foreign suppliers, high cost, exchange implications and geo-political ramifications.
o so, a balance between competitive necessities like efficient procural, top quality standards and acceptable prices has to be established through this DPP.
· Shift specialize in Self-reliance: there's Brobdingnagian potential to leverage the hands and engineering capability inside the country for attaining self-direction in style, development and producing in defence sector.
· Streamlining and simplifying process: Defence procural involves long gestation periods and delay in procural that impact the state of our forces, besides leading to cost.
o DPP favours swift deciding, provides for appropriate timelines Associate in Nursingd delegates powers to the suitable authorities to confirm an economical and effective implementation of the procural method, by all stakeholders involved.
· Addressing the triremma: Republic of India aspires to the acquisition of high-quality instrumentality, at low price, in an exceedingly short timeframe, once solely 2 of those 3 area unit doable at any time.
o Thus, crucial selections can got to be created to sacrifice either price, quality, or speed of acquisition.
o If clear selections on these lines don't seem to be created, Republic of India may notice itself within the worst of all worlds: defrayal high amounts tardily for substandard quality instrumentality.
· outlined role for personal sector: non-public investment are going to be a serious contributor to the ‘Make in India’ initiative, accelerate manufacturing-led industrial growth and for capital and technology advancement.
Why in News?
Ministry of Defence (MoD) free draft Defence procural Procedure (DPP) 2020 that aims to extend autochthonic producing and expedite procural of defence instrumentality.
More on News
· DPP can cowl all Capital Acquisitions undertaken by MoD and repair Headquarters (SHQ) each from autochthonic sources and ex-import, aside from medical instrumentality.
o Defence analysis and Development Organisation, Ordnance manufactory Board and Defence Public Sector Undertakings can, however, still follow their own procural procedure.
· it'll supervene upon DPP 2016. The draft was finalised by a committee headed by Director General Acquisition, that was found out in August 2019.
About Defence procural Procedure
· it had been 1st introduced in 2002 to supply integrity, transparency and a structured procedure which might contour the procural of military hardware for the militia in an exceedingly time sure manner.
· DPP has been a piece ongoing since its initiation in 2002 and tho' consecutive iterations in 2006, 2008, 2011, 2013, 2016 and at last in 2020.
· DPP 2020
o Its aim is to confirm timely procural of military instrumentality as needed by militia in terms of performance, capabilities and quality standards, through optimum utilization of allotted monetary fund resources
o additionally, self-direction in defence instrumentality production Associate in Nursingd acquisition are going to be unwaveringly pursued as attention of the DPP with an final aim to develop Republic of India as a world defence producing hub.
Key options and changes in DPP 2020
· autochthonic Content (IC) quantitative relation hiked: visible of the expertise gained by the domestic business, the Draft proposes increasing the IC stipulated in numerous classes of procural by regarding 100% to support the ‘Make in India’ initiative.
o Use of raw materials, special alloys and software system incentivised as use of autochthonic material could be a
very important side of ‘Make in India’ and Indian corporations area unit world leaders in software system.
· New class obtain (Global – Manufacture in India) has been introduced with minimum five hundredth autochthonic content on price basis of total contract price.
o solely the minimum necessary are going to be bought from abroad whereas the balance quantities are going to be factory-made in Republic of India.
o this could be in preference to the ‘Buy Global’ class as producing can happen in Republic of India and jobs
will be created within the country.
· Leasing introduced as a replacement class for acquisition additionally to existing ‘Buy’ & ‘Make’ classes to substitute large initial capital outlays with periodical rental payments.
o Leasing is permissible underneath 2 classes
ü Lease (Indian) wherever owner is Associate in Nursing Indian entity and is that the owner of the assets
ü Lease (Global) wherever owner could be a international entity.
o this may be helpful for military instrumentality not employed in actual warfare like transport fleets, trainers, simulators, etc.
· New Chapters introduced:
o for procural of software system and systems connected comes
o for Post Contract Management to facilitate and supply clear tips for problems arising throughout the contract amount as generally Defence contracts last for an extended amount.
o A comprehensive Chapter introduced for ‘Make’ to hide procural from makers in Republic of India
including start-ups and innovators and from analysis comes of DRDO.
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