Lok Sabha Question No. 3628 (UNSTARRED), answered on 2021-03-17
Subject: Domestic Procurements
Ministry: DEFENCE
Asked by: Komati Reddy Venkat Reddy, Geetha Viswanath Vanga

## GOVERNMENT OF INDIA MINISTRY OF DEFENCE DEPARTMENT OF MILITARY AFFAIRS

## LOK SABHA UNSTARRED QUESTION NO.3628

TO BE ANSWERED ON 17 th  March, 2021

## DOMESTIC PROCUREMENTS

## 3628. SHRI KOMATI REDDY VENKAT REDDY: SHRIMATI VANGA GEETHA VISWANATH:

Will the Minister of DEFENCE j{kk ea=h be pleased to state:

- (a) whether the Government is working on domestic procurements and the new 'negative list' is expected to be issued and if so, the details thereof;
- (b) whether around 10 mid-sized projects are l ikely to be allotted to the private sector in future and the deal for Light Utility Helicopters/Light Combat Helicopters is likely to be signed soon and if so, the details thereof;
- (c)  whether  the  Government  and  private  sector  will  be  working  with  Start-ups  under  the Innovation for Defence Excellence(iDEX) initiative as a part of series of efforts to streamline defence procurement; and
- (d) if so, the details thereof, project-wise and the steps being taken to bring down the delays in time-lines of capital acquisition?

## A    N    S    W    E    R

MINISTER OF STATE IN THE MINISTRY OF DEFENCE

(SHRI SHRIPAD NAIK)

- (a)   Yes, Sir.  The Government is working on Second 'Positive Indigenisation List' as part of Aatmanirbhar Bharat Abhiyan on domestic procurements.
- (b) (i)  Government is pursuing initiatives to achieve higher levels of Indigenisation and selfreliance  in  the  defence  sector  by  harnessing  the  capabilities  of  the  public  and  private sector industries in the country.

- (ii)    Case  for  procurement  of  Light  Utility  Helicopters  (LUH)  and  Light  Combat Helicopters (LCH) is being progressed in accordance with extant procedures.
- (c)  &  (d):    (i)    Innovations  for  Defence Excellence (iDEX) framework was launched in April, 2018  with  an  aim  to  achieve  self-reliance  and  to  foster  innovation  and  technology development in defence and aerospace by engaging industries including MSMEs, Startups, individual innovators, R&D institutes and academia.
- (ii)    iDEX  provides  grants  for  prototype  development  and  promotes  innovation  and entrepreneurship among the Defence Start-ups.

(iii) Various initiatives being undertaken under iDEX are placed at Annexure-1.

(iv)    Steps  to  bring  down  the  delays  in  timelines  of  capital  acquisition  are  placed  at Annexure-2.

*****

## ANNEXURE-1 REFERRED TO IN REPLY TO PARTS (c) & (d) (iii) OF LOK SABHA UNSTARRED  QUESTION  NO.  3628  FOR  ANSWER  ON  17.03.2021  REGARDING 'DOMESTIC PROCUREMENTS'.

## Details of Initiatives under iDEX

1. Defence India Startup Challenge (DISC). iDEX is emerging as a front runner & has gained substantial  traction  in  the  Defence  Startup  Community.    Various  MSMEs/Startups  have  been funded  so  far,  to  evolve  services  related  research  towards  challenges/Problem  Statement  of Indian Forces.  DISC IV was launched on 29 September, 2020 by the Hon'ble RM.
2. iDEX Open Challenges .  As part of the iDEX Open Challenges, the received proposals are reviewed for approval by the High Powered Selection Committee (HPSC).
3. iDEX 4 FAUJI. iDEX 4 FAUJI was launched, along with Defence India Startup Challenge IV  to  support  innovations  identified  by  grass  root  service  personnel  serving  in  the  field conditions.    This  would  incorporate  the  first-hand  experience  for  improving  and  bringing operational and maintenance improvements in existing platforms, as also generate futuristic ideas for  innovations  in  defence  manufacturing.    These  would  then  be  issued  as  challenges  under iDEX with the shortlisted start-ups being assisted by the applicant servicemen.
4.    As  part  of  iDEX  initiative,  OFB  has  taken  up  in-house  R&D  projects  for  development  of Armament, Ammunition & Equipment items of Land Systems pertaining to i.e. Artillery & Air Defence Gun Systems, Small Arms Weapons Systems, Armored Fighting Vehicles and futuristic smart ammunition systems.
5.  DRDO through Technology development scheme (TDF) scheme aims to fund private sector industry especially MSMEs including Start-ups.  Total 25 Projects have been awarded to various private industries including MSMEs and start-ups under TDF scheme so for.  The DRDO has also launched a pan India contest' to bring innovators, entrepreneurs, individual and start-ups for innovative ideas in the field of Defence and Aerospace.
6.  There are 11 projects of Indian Army as part of DISC and Open Challenges of iDEX which involves hand holding of 23 start-ups.  Indian Navy has leveraged iDEX scheme and is presently engaging  21  start-ups  in  design  and  development  for  09  projects.    IAF,  as  part  of  these initiatives, is progressing 11 cases and is engaged with 17 start-ups/individual innovators/MSMEs for design and development of innovative equipment through iDEX.

*****

## ANNEXURE-2 REFERRED TO IN REPLY TO PARTS (c) & (d) (iv) OF LOK SABHA UNSTARRED  QUESTION  NO.  3628  FOR  ANSWER  ON  17.03.2021  REGARDING 'DOMESTIC PROCUREMENTS'.

## Steps taken to bring down Delays in Timelines of Capital Acquisition

1.  The aim of the Defence Acquisition Procedure- 2020 (DAP) is to ensure timely procurement of  military  equipment,  systems  and  platforms  are  required  by  the  Armed  Forces  in    terms  of performance,  capabilities  and  quality  standards,  through  optimum  utilisation  of  allocated budgetary resources.  The following measures have been envisaged in DAP for achieving timely, efficient and effective procurement:-
2. (a)  Exemption of CNC (Contract Negotiation Committee) from furnishing Reasonability of Cost Certificate for DPSU Equipment already Priced by Committee constituted under orders of Hon'ble Raksha Mantri.
3. (b)    Delegation  of  Financial  powers  to  Services  Headquarters  from  Rs.150  Crores  to Rs. 300 Crores.
4. (c)    Broad  timeframe  for  completing  procurement  activities  (from  AoN  to  award  of contract) had been reduced from 80-117 weeks to 70-94 weeks in multi vendor cases and form 92-137 weeks to 82-114 weeks in resultant Single Vendor cases.
5. (d)  Acceptance of Necessity (AoN) validity has been reduced to six months (from one year) for 'Buy' cases and to one year (from two years) for 'Buy & Make (Indian)' cases.
6. (e)    Draft  Request  for  Proposal  (RFP)  has  to  accompany  Statement  of  case  (SOC)  for AoN.
7. (f)  Single vendor cases at the bid submission and TEC stages will not be automatically retraced  but  processed  with  due  justification  with  the  approval  of  Defence  Acquisition Council(DAC).
8. (g)  Guidelines for change of Name of Vendor have been incorporated in DPP-2016 and Guidelines for Handling of Complaints have been notified to address avoid delays on this account.
9. (h)  To rationalize time taken for Field Evaluation Trials (FET), it has been provided that FET  be  held  in  conditions  where  equipment  is  most  likely  to  deployed.    In  addition, provisions have been incorporated for increased use of certification and simulations in the technical evaluation of equipment.
2. Monitoring Mechanism. As part of DAP-2020, various monitoring mechanism have been introduced.    Some  of  the  existing  monitoring  mechanism  for  the  Acquisition  schemes  is  as follows:-

: 2 :

- (a)  Periodic review of Pre-contract schemes by PSO/APSO at SHQ and by DG(Acq) at MoD.
- (b)  Periodic review of delayed cases by DPB/DAC.
- (c)  Six monthly Review of shipbuilding cases by the Apex Steering Committee, headed by Secretary (DP) and Quarterly review by CWP&A.
- (d)  Empowered Project Committee (EPC) for SP Model 10(1) schemes, FTP cases.
- (e)  Monitoring of Make cases by Secretary (DP) and Head PMU-Make.
- (f)  Post Contract Monitoring for Projects.

*****