It was long thought that nuclear, space and missile programs will provide us with Security and ‘Stability’. However ‘Instability’ due to threat from China and Pakistan has increased recently. This is happening at a time when the Pandemic is devastating our economy. The PM has responded to the Pandemic with the ‘Atma Nirbharta’ call. Thereafter, the FM and the CDS in a major shift in future defense procurement have emphasized the need to hand hold Indian defense industry. Resultantly, India must indigenize weapon procurement, in recessionary conditions with reduced budgets. The available budgets must cater for old as well as emerging technologies. Overall India is in a strange ‘Stability – Instability’ paradox in which we cannot let our guard down even momentarily despite the Pandemic.
Under such conditions we must reduce imports through Import Substitution of small parts and components, Upgradation of existing equipment and Reverse Engineering of certain weapons. We need to increase emphasis on Quality and Cost Effectiveness to cut down on expenditure. There can also be no letup in our procurement and modernization lest we are left vulnerable against our adversaries. It is a major conundrum. Extensive interaction carried out with experts indicates that we are in difficult times. There is also a consensus that there is a requirement to focus on Defense Capital Procurement which is likely to go off track.
Capital acquisition of any major weapon system is a ‘decadal process’. It demands great expertise and sustained application to get results. Hence, the response to the emerging situation needs intellectual clarity and a sense of purpose to shorten time frames. There must be a two-pronged approach. The first prong is to resolve cases and clearing critical capacity enhancers within the available budgets. The second prong pertains to processing cases upto contract stage for execution when budgets are enhanced. Indigenization should be the underpinning watchword in all this.
Defense Capital Procurement has suffered due to many reasons which have been often analyzed. However there are some fundamental problems in execution. Our monitoring and review mechanisms are weak. Accountability and transparency are an issue. Indigenization focus has been lacking. Theoretically the Defence Acquisition Council and Defence Procurement Board are supposed to cater for all these issues. However, in practice it does not happen. So, cases languish. Acceptance of Necessities lapse. Request for Proposals remain under preparation. Cost Negotiation Committees continue interminably. Trials never end.
A major long-term change is warranted. However, at present we do not have the luxury of time to effect long term changes. Business as usual is also not an option. Our response should be such that any change implemented now should meet the immediate requirement and lead to a long-term change.
There is another basic flaw which also needs rectification. The people who operate our Procurement System are transitory and transactional. Very often they are inhibited by lack of expertise. Not due to individual short comings but more often due to short tenures, lack of background/holistic understanding or simply due to work pressure. The crux is that a transitory system with a weak knowledge base handles complex problems of long-standing nature. Such problems need handling by experts on a sustained basis. Our periodic response to the problem has been to amend the DPP. With each review and a new DPP, the system has only become more complicated and counterproductive.
There is a dire requirement for an expert body to assist the defense procurement process. It is recommended that a Defense Procurement Advisory Board (DPAB) be established. The National Security Advisor and the National Security Council have an advisory board of experts assisting them. Similarly the MOD should have a DPAB. Under the circumstances it is almost mandatory to have one.
The proposed DPAB should consist of experts whose main tasks would be to analyze, review and monitor cases and render advise on prioritization of schemes. They should throw up least cost options in best possible time frames to increase operational preparedness at minimum risk. They should catalyze situations and speed up processes. They would lead in building institutional knowledge on indigenization and procurement. They would also enable identification of relevant technologies essential to defense procurement – indigenous or otherwise. They would be critical to time, cost, and financial assessments. They would promote joint procurement. This body should be empowered, relevant to the context and hands on with current cases. The DPAB should have the wisdom to kickstart long term reforms of the procurement system. In specific cases, the advice of the DPAB should be of binding nature. The DPAB could work under the CDS or RM. It can even advise the NSA chaired Defense Planning Committee.
The DPAB should be manned by experts, by reputation, wisdom, integrity, capability, and a proven track record in procurement. A balance of technological and operational knowledge with acumen is mandatory. The body should have representation from all Services, one Civil Service Officer and a finances specialist. It should not be a post retirement lolly pop. A proven track record of indigenization will be good. A 360-degree view should be taken from the environment before appointing members. There is only one interested entity for which the Board should work for in a bipartisan manner – India. Representation of interested parties on the Board should be avoided. Any input from DRDO, Industry, PSUs and OFB, who largely constitute the interested parties, can be taken on a case to case basis. Personally, I would like to see this board working on Honorary basis. At some stage we must put this cause beyond money or compensation.
This is the minimal top driven reform in procurement which can be effective immediately without hassles to progress Capital Acquisitions in the correct time frame and direction and carry out modernization in tight budget conditions. Time for ‘Business as Usual’ is over.
The illuminating wisdom of Vice Admiral Raman Puri (retd) in formulating this article is fully acknowledged.