In a determined bid to promote local industry in defence production, the Government on Tuesday gave the nod for acquiring indigenous equipment worth over Rs 8,500 crores. It also approved a scheme worth nearly Rs 400 crores for innovations by the Indian entrepreneurs for developing world class weapon systems.
These major decisions were taken in the Defence Acquisition Council (DAC) in its meeting on Tuesday here chaired by Defence Minister Rajnath Singh . It is the apex body to approve the proposals for acquisitions.
Giving details later, defence ministry officials said later Rajnath accorded Acceptance of Necessity (AoN) for Capital Acquisition proposals of Armed Forces amounting to Rs 8,357 crore. As an impetus to ‘Aatmanirbhar Bharat’, all of these proposals have been approved under ‘Buy (Indian IDDM)’ category with focus on indigenous design and development and manufacturing in India. The AoNs accorded by the DAC include procurement of Night Sight (Image Intensifier), Light Vehicles GS 4X4, Air Defence Fire Control Radar (Light) and GSAT 7B Satellite. Acquisition of these equipment and systems will enhance operational preparedness of Armed Forces by providing better visibility, enhanced mobility, improved communication and increased capability of detecting enemy aircraft.
In a path-breaking initiative to encourage innovation, the DAC also accorded consolidated AoN for procurements amounting to Rs 380.43 crore from the iDEX startups and MSMEs. To accelerate the pace of indigenisation,achieve self-reliance in defence and to facilitate Ease of Doing Business for defence industry, the DAC approved effecting the following policy initiatives in the DAP-2020. These include all modernisation requirements of defence forces to be indigenously sourced and import to be resorted to only as exception. To reduce financial burden on the defence industry, requirement of IPBG is to be dispensed with and Earnest Money Deposit (EMD) to be introduced as bid security and PCIP cover upto contract stage. EMD will be applicable only for proposals of Rs 100 Cr and above and MSMEs and Startups will be exempted from EMD.
Vendors whose products are successfully trial evaluated will be provided a certificate to that effect. IDEX and Make II procedures have been simplified thereby compressing timelines and ensuring early placement of contracts on successful iDEX and Make II vendors.
Rajnath gave the go=ahead for procurement of 14 items worth Rs 380.43 crore from the Innovations for Defence Excellence (iDEX) startups and MSMEs. These items will be procured by the Indian Army, Navy and Air Force. The DAC also approved the new simplified procedure for procurement from iDEX startups and MSMEs. This would fast-track the procurement from the startups/MSMEs.
The procurement cycle from the AON to contract signing will be around 22 weeks as per the new procedure. Suitable incorporation will be made in the Defence Acquisition Procedure 2022. The DAC also approved the simplified procedure for Make-II category projects on similar lines of iDEX procedure and would considerably bring down the time taken from prototype development to Contract signing in Make-II projects.
The iDEX, a game changer in the Defence eco-system, was launched by Prime Minister Narendra Modi in 2018 with the objective of fostering innovation and incorporating cutting-edge and disruptive technologies in the Armed Forces in a quick time-frame. The iDEX scheme, since its initiative in 2018, has now gathered momentum, and it is expected that around 25-40 items after the successful prototyping by the iDEX startups/MSMEs, will be ready for procurement by this year end.
The iDEX scheme has been instituted under the over-arching mission of the defence ministry to achieve self-reliance and indigenisation. The iDEX is catalysing the vibrant energy of our startup eco-system and is today steering trans-disciplinary innovations.
An enterprising network of experts from the Services, DPSUs, Industry, Academia, iDEX officials and the startups/MSMEs are involved in the process of co-creation and co-innovation. The aim is to provide atleast 50 world class solutions to the Armed Forces and the defence industry in the near future. The five editions of DISC and the various Open Challenges have been a huge success and have witnessed tremendous interest and participation from the startups. The iDEX is scaling up at a breakneck pace to support more and more innovators and startups. The iDEX startups are now entering the next phase, i.e., productionisation and commercialisation. This will indeed lead to the broad-basing of the defence industrial base.