Press Release

Defence procurement related exercise to yield results in 2017: Manohar Parrikar

Date : Wednesday, December 14, 2016

Press Release Details

 The exercise undertaken by the government in terms of defence procurement will start yielding results from next year onwards, Union Defence Minister, Mr Manohar Parrikar said at an ASSOCHAM event held in New Delhi today.
“In defence procurement we have planted some grafts, which I expect to produce result, but even there you have to wait for 2-3 years, now two years are over, probably next year 2017 is a year where whatever exercise has been carried out will start yielding results,” said Mr Parrikar while addressing an ASSOCHAM conference on ‘Defence Production: Self reliance & beyond.’
He said that most of the issues pertaining to defence procurement procedure are being gradually sorted out.
“I am still clearing the mess of the earlier government, I do not intend to point finger, this is not for blame game, but till now there were so many errors, mistakes, casualness, things have gone in cycles and cycles,” said Mr Parrikar.
“Slowly but surely these issues are getting sorted out and I am very sure that we will make it as the road ahead is very clear,” he added.
Highlighting that government has initiated various policy initiatives, the Union Defence Minister said, “If we properly assess the requirement of defence forces, we can make many of the changes happen.”
He also said that industry should come out with clear recommendations. “We expect that while we will also change DPMs (Defence Procurement Manuals) and OFB (Ordinance Factory Board) very soon into IDDM (Indigenously Designed Developed and Manufactured) concept, slightly differently put up, but at the same time we will expect that the biggies in the private sector also spread requirement to the small and medium.”
“There is a definite improvement, the percentage of small and medium, legally required is 20, it was around between 9 per cent in OFBs and to about 14-15 in PSUs, today it has crossed 20 and is at an average of about 29 per cent in MSME (micro, small and medium enterprises) sector,” he added.
Talking about the need for India’s defence public sector undertakings (DPSUs) to remain competitive, he said that if good material can be got at a cheaper price why should advance be paid, except where development and small scale industry is involved.
“Why should he restrict himself, he should ask for best quality at cheapest rates. I am not going to give advance if I can get good material at credit why should I pay advance to another company,” said Mr Parrikar.
He said that in case of high-technology item, the policy has to be different.
“If it is developed, manufactured and supplied by small industry, the policy has to be different, we are working on it, that is why some time is being taken, but when it comes out it will be much better manuals,” said the Union Defence Minister.
“Both these manuals are being worked because now lot of things have been eliminated, they are gone, so now there are very few things, but critical issues are remaining,” he said.
He said that there are more issues in offset like skill development, if it should be outsourced to a competent agency, and if it can be used for venture capital. “These are questions we are answering and will be replying to them very soon but I think all these aspects are now limited to 4-5 pointed issues, give us those.”