The Government is planning to do away with the process of awarding the contract to the lowest bidder while acquiring high-tech Defence assets and instead entering into “strategic partnership” with Indian private firms in six critical sectors including missiles.
The Defence Ministry has set up a high-powered committee headed by former DRDO chief VK Aatre to recommend guidelines for selecting Indian private firms for strategic partnership in critical areas which include submarines, aircraft and missiles, Defence Minister Manohar Parrikar said on Saturday.
“Instead of asking for tendering and all those things, a process of selecting a right partner is chosen. If you select through l1 (lowest bidder), you may end up with someone who is not capable. My aspect of a success is capability of that partner,” Parrikar at a FICCI organised seminar.
He was replying to a question whether the new policy will also apply to the over `60,000 P75-I project under which six more conventional submarines are to be built.
Making it clear that there won’t be any repetition, he said: “If an X group has been taken in as a strategic partner in one segment, it will not be considered for another. It can participate in partnership for other products”.
Explaining the concept, Parrikar gave the example of State-run Mazagon Dock limited (MDl) which is building six Scorpene-class submarines and is also vying for the P75-I project. Apart from MDl, one private firm can also be considered for submarines, he said.
“As I said MDl has capability and let one private sector (entity) come in. Who is that private sector playerIJ How do you selectIJ It is not toss and neither my decision. So there has to be some mechanism and for that we have the committee under chairmanship of Aatre along with some top experts,” he said.
He said once the domestic strategic partner is selected, talks with foreign technology provider or FDI partner will be undertaken to carry out the project. Strategic partnership was one of the proposals of the Dhirendra Singh Committee which had recommended a slew of steps to ease the Defence Procurement Policy. The Aatre Committee has been asked to submit a report in three weeks, Parrikar said.