Given the rapidly rising pension liability in India and the concern expressed by the CDS, the experiences of the US and the UK could be useful in carrying out pension reforms in India.
The PPP model helps in improving the productivity and exploiting the full potential of asset-based services that base workshops provide. This is particularly relevant when there exists a competitive market and a benchmark for the army between an in-house and an external solution.
Considering the impending financial crunch due to the Covid-19 pandemic and uncertainty about allocations in the coming years, it is unlikely that the MoD will be able to launch many new procurement programmes under the new DPP any time soon.
The present crisis is as much of a challenge as an opportunity to infuse financial realism in defence planning and bring about concomitant reforms in the quickest possible timeframe.
Draft DPP-2020 marks a paradigm shift from the past in many respects. It contains several new features intended to hasten the procurement process and provide a further fillip to the Make in India initiative in defence.
There is a need to act quickly on the issue of force majeure to scotch all speculations about how the MoD is going to deal with the inevitable delay in performance of contracts and instil confidence among the vendors.
The slowdown in economic growth not only seems to have cast its shadow on the allocation of the defence budget for 2020-21 but has also compounded the challenges for the country’s first CDS.
Considering that the defence capital expenditure already accounts for a very high share in the central government’s overall capital spend, any substantial hike in the former’s share looks less likely. This is more so given the government’s priority to spend on infrastructure and other non-defence capital assets to revive the economic growth.
A Case for Deferring Promulgation of DPP 2020
Considering the impending financial crunch due to the Covid-19 pandemic and uncertainty about allocations in the coming years, it is unlikely that the MoD will be able to launch many new procurement programmes under the new DPP any time soon.