It has taken a full decade for DPP to be shaped into the present state of refinement. How long it would take to start showing results on the ground could be anybody’s guess.

The new DPP-2011 has incorporated a few much needed refinements which make it more convenient, at least in terms of meeting the offset obligations by the prospective foreign vendors, for the sale of defence equipment to the Indian armed forces. This was made possible by adding the civil aerospace and internal security sectors to the defence in the list of products eligible for the discharge of offset obligations.

But how did it all start? In 2001 (post-Kargil operations), a Group of Ministers (GoM) was constituted to reform the National Security System. Apart from other recommendations, they reviewed the defence procurement procedures and recommended the setting up of a new Defence Procurement Management Structure and Systems. Accordingly, these structures and systems were set up at the Ministry of Defence (MoD) the same year and in order to operationalise them, the procedure for defence procurement of 1992 vintage was revised. The Defence Procurement Procedure 2002 (DPP 2002) came into effect in December 2002. It was applicable to procurements flowing out of the ‘Buy’ decision of Defence Acquisition Council (DAC). The scope of this procedure was enlarged in June 2003 to include procurements flowing out of ‘Buy and Make’ decisions. The procedure was further reviewed in DPP-2005 which came into effect from July 1, 2005. The DPP-2005 was also reviewed and revised based on the experience gained in its implementation and further enlarged to include a revised ‘fast track procedure’ and ‘procedure for indigenous warship building’. It also included procurements categorised in the ‘Make’ category for bridging the critical gap and provided requisite framework for increased participation of Indian industry in the defence sector. This brought in DPP-2006 which came into effect from September 1, 2006. At this stage, it was decided that review of the procurement procedure would be undertaken every two years. This led to the issuance of DPP- 2008 which was further revised in late 2010 and officially released on January 13 this year as DPP-2011.

In addition to the improvements brought out in the In Focus column, another major refinement has been the inclusion ‘Buy and Make (Indian)’ procedures in DPP-2011. In cases initiated under this category, RFP will be issued to only Indian vendors, who are assessed to have requisite technical and financial capabilities to undertake such projects. For selection of such cases, the concerned Service HQ (SHQ) will be asked to prepare a Capability Definition Document outlining the requirement in operational terms indicating present capabilities determined on the basis of existing equipment and the future requirements in terms of numbers, time-schedule, fund availability and the critical technologies to be absorbed by the Indian partner. The Capability Definition Document after examination by the Services Capital Acquisition Plan Categorisation Higher Committee (SCAPCHC) will be approved by the Defence Acquisition Council. The document would be floated to the concerned Indian firms to give Detailed Project Proposal (DPP – not to be confused with the Defence Procurement Procedure) outlining the roadmap for development and production of the item either by themselves or with the help of any production arrangement with foreign manufacturer.