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Editor’s Note
The review of DAP 2020 is in progress, and the defence industry is awaiting the final format that it will take. The DAP review has multiple objectives, including enhancing the desired capability of the forces and facilitating the ease of doing business. Both issues are closely linked and complemented by multiple processes and procedures. The article favours an unconventional approach that will provide clarity and eliminate ambiguity.
An exercise is currently underway in the Ministry of Defence (MoD) to review the capital acquisition procedure that is embodied in Defence Acquisition Procedure 2020 (DAP 2020). First codified as a separate procedure for defence purchases in 2002, it has been revised at least eight times since then. Each review led to the procedure becoming more nuanced, without necessarily resulting in any conspicuous reduction in the procurement timelines.
Within less than a year of the promulgation of DAP 2020, the then Army Chief General MM Naravane came down heavily on the overbearing nature of rules and regulations, which, he said, led to a ‘zero error syndrome’. Questioning the L1 concept, which requires the required equipment to be purchased from the lowest bidder whose products meet the service-specified qualitative requirements, he called for a ‘revolution in bureaucratic affairs’ to ensure that the soldiers get the required equipment on time.
The outburst was surprising because DAP 2020 had been finalised after a year-long deliberation with the armed forces, among other stakeholders, but the point he made was unexceptionable.
The primary focus of the DAP 2020 Review Committee must be on equipping the armed forces with the necessary capabilities within the desired timeframes. However, a communication issued by the committee soliciting comments and suggestions lists out several other objectives, such as achieving self-reliance in defence production, promoting ‘Make in India’, encouraging transfer of technology (ToT) and foreign investment, and improving the ease of doing business in defence. All these objectives are also essential, but they must not be allowed to distract from the main purpose of the procurement procedure or impede its efficacy.
The speed at which procurement proposals get finalised does not depend only on efficient procedures. Other factors, notably an overarching procurement policy, financially viable acquisition plans, and a composite organisation to handle all aspects of acquisition from the stage of identifying operational requirements to the induction of the requisite capabilities, also play a significant role, besides the quality and speed of decision-making and the adequacy of budget outlays.
The DAP Review Committee cannot obviously address all these issues, especially policy issues that fall outside the MoD’s remit, such as foreign direct investment and industrial licensing. It can only make whatever recommendations it considers appropriate on these issues for the government’s consideration. Within the realm of defence procurements, however, it may be a good idea to start by articulating a defence procurement policy.
Unlike the Defence Production Policy 2011, there is no document which lays down a cut-and-dried Defence Procurement Policy. This policy should remain consistent over a long period to inspire confidence among the industry, service providers, innovators, R&D institutions, academia, and all other stakeholders who must come together to meet the current and future requirements of the armed forces.
While policy provides the backbone of the procurement framework, its implementation requires the formulation of flexible procedures that serve the policy’s objectives. Flexibility can be built into the procedures by setting limits within which procurement personnel can exercise discretion to overcome any roadblocks that inevitably crop up in all procurement programmes.
Within this theoretical framework, the existing procedures could be reviewed along two tracks: stages in the acquisition cycle and the processes linked with each stage in the cycle. According to DAP 2020, the acquisition cycle comprises 13 stages, spanning from the time a Request for Information is issued by the MoD to the finalisation of the contract. Post-contract management is listed as the fourteenth stage, although it is not strictly a stage in the acquisition cycle per se. The possibility of reducing these stages or collapsing some of them can be considered.
For example, the technical evaluation of bids is a mechanical task, as it involves ticking boxes to ensure that the offer complies with all the technical and financial requirements outlined in the Request for Proposal (RFP). Completing this task, preparing the evaluation report and obtaining approval of the designated authority takes some time, however limited it may be. Given the space constraint, it is not possible to argue in detail, but it seems eminently possible to complete this task in virtually no time with AI-enabled processes, if it cannot be skipped altogether based on self-certification by the bidders and some more safeguards built into the RFP.
As for the processes linked to each stage in the procurement cycle, the existing manual suffers from ambiguity in some cases and excessive controls in others. For example, DAP 2020 directs that the Field Evaluation Trials (FET) are not to be conducted as a process of eliminating bidders, but to nurture competition. Therefore, the primary focus of the evaluation should be on testing the equipment based on its anticipated employability.
It may not be of much help to a Trial Team in determining what to do when faced with a situation where minor in-situ repairs or modifications can be carried out on the equipment fielded for trials. It is to ensure that the bidder does not get eliminated in field trials, thereby limiting wider competition. Clear instructions are necessary to handle such situations. More examples could be added.
What is required is a bold and unconventional approach to simplifying the procurement procedures, but the outcomes may remain suboptimal unless the committee pays careful attention to the sequencing of the manual’s contents and its syntax. There are paragraphs which run into more than 400 words, while some others are so worded as to lend themselves to differing subjective interpretations. Textual clarity will facilitate the smooth execution of the processes at every stage. A little professional help in editing the final draft will go a long way in improving the quality of the output.
Amit Cowshish
Amit Cowshish is a former Financial Advisor (Acquisition), Ministry of Defence. He was associated as a Distinguished Fellow with the Institute for Defence Studies and Analyses, New Delhi, and as a Partner with Dua Associates, Advocates and Solicitors. A post-graduate in Political Science, he also holds an M Phil and LL B degrees.
He has attended the National Security and Strategic Studies course at the National Defence College, New Delhi. He writes regularly on matters concerning financial management in defence, procurement policy and procedures, budget, planning and other related issues.
