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Ignoring strategic factors in procurement decisions can’t continue....

Vinay Shankar

August 18, 2009 04:23 AM IST First published on: Aug 18, 2009 at 04:23 AM IST

In its first innings,the UPA’s track record of defence procurements was quite dismal. The only positive feature was the defence minister’s spotless image. Banking on his enhanced credibility he can now with confidence take the bold decisions necessary to banish the paralysis that envelops his ministry’s procurement procedures. His announcement recently that the procurement mechanism will be re-examined every year,and completely overhauled this year,

is a sign of that.

Ever since the Bofors controversy,the belief of successive dispensations that rigid procedural policies will cleanse the system and make it efficient continues to be belied. The label of inefficiency,and the vague suspicion that matters are not entirely above board,remain affixed to our defence ministry unlike any other department of our government; perhaps unfairly so.

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This impression has real costs. Given the imperatives of national security and the criticality of speedily addressing the infirmities and gaps in our military capability,our procurement approach requires serious and urgent re-examination.

Currently,it is procedure- and technicality-driven,a ritual of endless trials and reams of paperwork but no acquisitions. Take the case of the army’s need for self-propelled artillery,first articulated in 1978. The acquisition process started in 1982. No outcome yet. The path traversed for towed guns is almost identical. (The jet trainer story is too well known to require retelling.) Among the many reasons for such delays is our obsessive and overriding preoccupation with sanitising (like the mindless “no agents” obsession) the procurement system. Consequently,it has been rendered devoid of judgment and discretion.

Two approaches are generally adopted: the first is to combine the positive features of known contemporary systems,tweaked a bit depending on the personal predilections of officers in the processing chain. The second is vendor-driven,in which the vendor convinces the user that a particular product is unique and would enhance combat capability. But procedures do not permit such procurement; thus we go through the charade of framing the qualitative requirements,obtaining the acceptance of necessity,identifying other vendors,issuance of the Request for Proposal,trial evaluation,etc. After all this,when and whether the procurement actually takes place,is anybody’s guess. The Smerch multi-rocket launcher took 10 years to acquire.

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In the global arms market,tier-one products,their features and their manufacturers are common knowledge. For example,for multi-role combat aircraft,there are the F-16 and F-18,the Typhoon Euro-fighter,the MiG-35,the Gripen,and the Rafael. Each is of the latest generation; they’re by-and-large comparable. The differences lie in design philosophy: mobility versus protection versus firepower.

The point is that any of these could be bought and would generally serve our purpose,as long as temperature- and altitude-related features are factored in.

Otherwise the process is actually comparable to buying a car,or any other commercial product from the market. If there was some method to establish as to which car was the best value for money then that car alone would sell. But that doesn’t happen; customer preferences matter. Some want the Skoda,thinking its sturdy; others might like the Corolla’s looks. But for the MoD,exercising such choice leaves it vulnerable to accusations.

So why not graduate to a more sophisticated procurement system for major systems? Big-money purchases enable strategic,commercial and technological leverage. Each of these should be part of the decision-making process. High-value procurements merit a more synergised and all-encompassing approach than what is currently being followed.

Empowered committees headed by individuals of unassailable credentials and comprising of competent members selected from the relevant fields of specialisation could be tasked to conclude major procurements on behalf of the defence ministry. Such a committee should have representatives from the forces,the defence-scientific establishment,from industry,and specialists in contracts and commerce. (Any final recommendation must have the concerned

service chief’s endorsement.)

Our declared policy must emphasise that the award of defence contracts would depend on the totality of the deal. What sensitive technologies are being transferred? What will be the buy-back agreements with our industry? What strategic support is being bundled?

For how long can we persist with the present tedious,letter-driven and largely unproductive process of procurement? It is time we changed. What is required is smart and sophisticated buying within the framework of our strategic imperatives.

The writer was Director-General,Artillery during the Kargil War

express@expressindia.com

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