The Indian defence forces will be allowed to take equipment on lease, which will drastically reduce the cost and acquisition time, as per the new draft Defence Procurement Policy. The document released by Defence Minister Rajnath Singh also offers special incentives to Indian designed and developed products, encourages the use of offsets for exports. The draft policy has also announced a new category to promote foreign vendors to establish manufacturing bases in India.
As per a report published in the Economic Times, the highlighting part of the draft policy is the provision to lease equipment including transport aircraft, trainers and simulators that do not have a direct combat role. The Ministry of Defence said, "Leasing has been introduced as a new category for acquisition to substitute huge initial capital outlays with periodical rental payments."
Notably, this is the first time a policy pertaining to leasing the defence equipment has come into existence. Although, the option of leasing was always available for leasing trainer aircraft and transport helicopters but was ignored due to a structured policy. The policy could be greatly beneficial for the armed forces as lower than desired budgetary allocation has crippled its war preparedness.
New Trail wings
Taking lessons from the past, the defence ministry has mooted a new 'trial wings' as a separate service of the armed forces which will be specialised in conducting field evaluations. Personnel of these wings will be trained to ensure a fair competitive process. "Field Evaluation Trials to be conducted by specialised trial wings and the objective of trials will be to nurture competition rather than elimination for minor deficiencies," the ministry added.
The draft policy will be finalised after consulting all the stakeholders. One of the major stresses the draft policy has given is on 'Make in India'. The policy plans to increase the Indigenous Content (IC) stipulated in different categories by 10 per cent. Moreover, the policy also specifically assures a jet engine manufacturer and chip manufacture manufactured in India to procure the manufactured goods as 'buyer nominated equipment'.