DAC simplifies defence acquisition procedure

• In a move to encourage greater participation by industry in acquisition of defence equipment, the Defence Acquisition Council (DAC) cleared a simplified “Make-II” procedure.
• The simplified ‘Make-II’ procedure will help import substitution and promote innovative solutions.
• This simplified ‘Make-II’ procedure will amend the existing ‘Make Procedure’ in Defence Procurement Procedure (DPP)-2016.

Important points of simplified Procedure:

• The salient features of the new ‘Make-II’ procedure include the industry suggesting projects especially among those items which are currently being imported. Start-ups or individuals can also suggest proposals. Service headquarters will also list out a series of projects which can be undertaken as ‘Make-II’ projects under the new procedure.
• The potential ‘Make-II’ projects will be approved by a collegiate comprising DRDO, HQ (IDS), Department of Defence under a committee chaired by Secretary (Defence Production).
• There will be no limit to the number of industry players who may respond to the expression of interest (EoI) for development of the prototype subject to meeting the minimum qualification criteria.
• The design and development time of 12 to 30 weeks is granted to industry to offer the prototypes.
• There is no limit to the number of industry players who may show interest and offer prototype.
• After this period, a commercial Request For Proposal (RFP) will be issued. Once the RFP is issued, it shall not be retracted.
• The industry player who wins the bid is assured of an order.
• Service Headquarters (SHQ) will constitute a project facilitation team for facilitating the process under this procedure.
• The case will progress even if there is single entity offering an innovative solution.
• The industry which develops the product will retain the title and ownership and all other rights in intellectual property. However, for some specified reasons like national security, government shall have ‘March-in’ rights.
• The ‘Make-II’ procedure reduces the total time from in-principle approval to placing of order by 50 per cent. The estimated time to finish the whole process has come down to 69 to 103 weeks.

About Defence Acquisition Council (DAC)

• To counter corruption and speed up decision- making in military procurement, the government of India in 2001 decided to set up an integrated DAC. It is headed by the Defence Minister.
• The objective of the DAC is to ensure expeditious procurement of the approved requirements of the Armed Forces, in terms of capabilities sought, and time frame prescribed, by optimally utilizing the allocated budgetary resources.
• The DAC is responsible to give policy guidelines to acquisitions, based on long-term procurement plans. It also clears all acquisitions, which includes both imported and those produced indigenously or under a foreign license.

By: Vishal