Why in news?
- The Ministry of Defence (MoD) has for the first time introduced leasing of defence equipment as a new category for acquisition in the draft Defence Procurement Procedure (DPP) 2020.
- This DPP would remain in force till 31 March 2025.
Proposed Measures un the DPP draft
- The draft proposed increasing the indigenous content stipulated in various categories of procurement by about 10% to support the ‘Make in India’.
- Leasing has been introduced as a new category for acquisition in addition to the existing ‘Buy’ and ‘Make’ categories to substitute huge initial capital outlays with periodical rental payments.
- Other proposed measures include making after-sales support part of the capital acquisition contract, higher indigenous content in acquisitions and incentives for local material and software and emphasis on product export under offsets.
What is Defence Procurement Process (DPP)?
- DPP is a national policy to purchase defence equipment.
- The Defence Procurement Procedure mainly contains processes that needs to be followed to streamline and simplify defence procurement procedures and ultimately achieve the objective of self-reliance in meeting all the security needs of the Indian Armed Forces by promoting indigenous design, development and manufacture of Defence weapon systems and, platforms in a time-bound manner without any delays.
Defence Acquisition Council (DAC)
- An overarching structure, the Defence Acquisition Council (DAC), under the Defence Minister was constituted for overall guidance of the defence procurement planning process.
- The objective of the Defence Acquisition Council is to ensure expeditious procurement of the approved requirements of the Armed Forces in terms of capabilities sought, and time frame prescribed, by optimally utilizing the allocated budgetary resources.
Composition of Defence Acquisition Council
- Defence Minister: Chairman
- Minister of State for Defence: Member
- Chief of Army Staff: Member
- Chief of Naval Staff: Member
- Chief of Air Staff: Member
- Defence Secretary: Member
- Secretary Defence Research & Development: Member
- Secretary Defence Production: Member
- Chief of Integrated Staff Committees HQ IDS: Member
- Director General (Acquisition): Member
- Dy. Chief of Integrated Defence: Staff Member Secretary