Defence Procurement

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  • Indian Companies - Need for a Clear Definition

    The Defence Procurement Procedure 2013, as also its earlier versions, does not define an Indian company. Some would argue that the answer is very simple: any entity registered in India under the Companies Act, 2013 or any other relevant statute and operating with a valid license, where such a license is required, qualifies as an Indian company, enterprise, institution or establishment.

    January 22, 2014

    Cancellation of the VVIP Helicopter Contract: Beginning of a Long haul?

    While there was perhaps no option for the MoD but to do what it has done, it would be naive to expect the seller to acquiesce in forfeiture of the bank guarantees, recovery of the sums allegedly paid in violation of the PCIP (assuming that it will be possible to recover this amount) and to simply take the three helicopters back without demur.

    January 06, 2014

    Revenue Procurement Practices in the Indian Army

    Revenue Procurement Practices in the Indian Army

    This monograph examines some aspects of the Indian Army’s revenue procurement practices. It discusses the peculiarities of these practices in the Indian defence and security setup, relating it to the contemporary risk scenario. This study draws attention to the corresponding trends in the private or commercial sector.


    US-India Defence Technologies for Transfer: Cultural Change

    India-US defence ties are shifting away from a ‘buyer-seller’ path to one of co- development and co-production. In Washington this is viewed as a change from a ‘culture of presumptive no to one of presumptive yes’.

    October 15, 2013

    Defence Technology Indigenisation: Need to go beyond Lip Service

    Though public-private partnerships is encouraged, privately the government continues to retain its monopoly on research and development and defence production through the DRDO, the ordnance factories and the defence PSUs.

    September 19, 2013

    Effectiveness of Quality Assurance in Army Procurements

    A closed loop feedback system for ensuring the quality of the Army equipment exists. Notwithstanding this, a number of Army equipment show a high failure rate at crucial times and are, therefore, a matter of great concern. These failed equipment have resulted in a number of avoidable casualties as well as restricted operational planning by tactical commanders in the field due to the non-availability of equipment for deployment, which results from their low reliability or high rates of failure.

    July 2013

    Reinventing Defence Procurement in India: Lessons from Other Countries and An Integrative Framework

    Over the past decade, defence capital acquisition reforms have enhanced standardization, transparency and bigger acquisition budgets. Yet the system grapples with delays, cost escalations and gaps in operational preparedness. This article explores the structure, process and cultural dimensions of the acquisition system, unpacking the underlying linkages between policy, planning, budgeting, strategic direction, and outcomefocused analytical decision-making—factors that influence effectiveness of the procurement system.

    July 2013

    Defence Procurement Procedure 2013 – A Ringside View

    Buy (Indian)’ the most important policy decision introduced through DPP 2013 suggests that it should be the first option or the most preferred category. It, however, gives rise to many questions.

    June 11, 2013

    Amendments to DPP-2011: An Analytical Overview

    On April 20th, the Defence Acquisition Council (DAC) of the Ministry of Defence announced 15 major amendments to the defence procurement and production policies, with the hope to incentivise indigenous defence manufacturing while promoting transparency and efficiency in the procurement process.

    May 06, 2013

    Krishnakanth asked: How do the terror groups fund themselves? How do they procure the ammunition & technology required?

    Vivek Chadha replies: India faces different types of internal security threats. The groups involved raise funds from different sources ranging from state sponsorship, extortion and taxation, crime and smuggling, amongst others.

    The militancy in J&K presents a classical case of state-sponsored and financed terrorism. The ISI employs state and private resources like drug money, donations and charities, as well as the globalised network for raising and moving funds from the Gulf countries. This support is further augmented by funding from the Kashmiri diaspora and NGOs. These are thereafter used as part of Pakistan’s proxy war against India, thereby bringing various components of finding together.

    Most insurgencies of the Northeast receive funding from extortion and taxation, which is a local source. This is supplemented by trafficking of drugs, weapons and counterfeit currency. The insurgencies in the region have limited state-sponsored funding from outside and raising finances through private sources is the norm.

    The case of CPI (Maoist) led insurgency is similar, with local financial resources providing bulk of its funding. There is as yet no substantive evidence of state sponsorship of the insurgency, nor have the insurgents profited substantially from the globalised financial environment.

    However, in the case of Indian Mujahideen (IM), state sponsorship in the form of financial support from Pakistan, privatisation through criminal activities to raise funds and exploitation of globalised networks for moving financial resources, yet again brings the trinity together.

    The groups then use the funds collected to smuggle weapons, explosives and technology based equipment like satellite radios, from across the border. India has porous borders with Nepal, which is exploited. Similarly, borders with Bangladesh, Myanmar and Pakistan are often used for pushing in weapons and ammunition.

    Also, refer to the following:; and

    Dushyant Singh,“Severing the Hawala Trail to and from India”, Journal of Defence Studies, 3 (4), October 2009.