A positive, calibrated and credible defence capability demonstration in wake of a national security crisis is a welcome sign and timely too in the midst of perpetual holding of the acquisition system in a crossfire of procedural delays, ambiguity and lackadaisical approach. The validation during Op SINDOOR of some of the strategic as well, as tactical weapon systems in operational environment has boosted the confidence of the entire ecosystem.

The land and air systems operationally exploited have been much in discussion and futuristic requirements being debated at various fora.  The capability of the aerial delivery platforms the backbone of the Air Force ie the fighter aircrafts was never in doubt but the efficacy of indigenous precision munitions has been a stupendous success. In the land systems deployed the air defence and precision guided missiles emerged as the game changers. The DRDO developed family of missiles which has been a laborious journey of decades and on the other end of the spectrum a variety of drones and loitering munitions acquired over past few years from a vibrant and enthusiastic defence industry including start-ups as well as established suppliers. This included some of the capabilities acquired as part of Emergency Procurements earlier and now again under active consideration at a much larger scale and scope.  This once again raises the issue of the tardy acquisition system. The system needs to be adaptive and agile.

Defence Acquisition Procedure 2020 (DAP 2020) is the eighth avatar of the Defence Procurement Procedure 2002 formulated after the Kargil Review Committee report, overhauled various facets of the National Security set up, be it structures, organisation or procedures etc.  Following the declaration of 2025 as the ‘Year of Reforms’, the Ministry of Defence (MoD) has initiated a comprehensive review of the DAP  2020 to align it with existing Government of India (GoI) policies and initiatives and DAP 2025 is likely to see the light of the day before the end of the year.

The need for the process to be “Adaptable and Agile” to meet the expectations of the stakeholders is of utmost importance. The recurring reviews have apparently attempted to make it not only exhaustive but possibly tried to cover all eventualities encountered in the processes. Will the DAP 2025 be the ultimate panacea? Alas not really! There will be yet many more knotty and inconspicuous issues which are likely to surface. What is important to understand is that whatever be the outcome, the DAP should be adaptable and agile. To put it in context, if adaptability part is expected out of the procedures and processes the agility part is expected out of the people manning the process. This perhaps has been the bane, since experience shows that for all ills the DAP is always held responsible while there is  no accountability of officials and organisations who are manning this system.  A look at these issues as in the DAP today and what more can be done to improve.

Adaptable DAP – Enablers And Possibilities

The DAP as on date is adaptable to a large extent. A few enablers have already been built in, but are reluctantly applied.  A few suggestions are as follows:-

(a)          Deviations. There may be situations which warrant a justifiable deviation. Paras 133 and 134 of Ch II legislate that any deviation from the prescribed procedure will be put up to DAC through DPB for approval. Situations not foreseen and explained in the DAP may arise; under such circumstances the spirit as explained in preamble would provide the DAC the necessary guidance to determine the appropriate course of action. Has immense potential to steer and provide mid-course correction to large number of cases running behind expected timelines.

(b)          Flexibility. The procedures are elaborately and separately covered to cater for different categories of acquisition be it Buy and Make, DRDO, Strategic Partnership, Innovation and Make etc. The provisions provide adequate flexibility in terms of timelines, trials or quality parameters. For example, quality parameters based on vendor certification, certification from accredited labs and trials by simulation are well acceptable and may be used to shorten the acquisition cycle. For added assurance the first lot of deliverables could be subjected to physical validation in actual conditions to confirm the veracity of claims. This approach is very selectively applied but merits adaption for faster induction.

(c)           Simultaneous Actions. One place where the adaptability needs to be built in assiduously is the sequential approach applied to processes. For an example, on receipt of the bid, the technical evaluation kicks off and on approval the trial process commences. The initiation of the trial process should be immediately on receipt of bids and the technical evaluation could proceed concurrently. Ultimately the technically qualified bids will only be trial evaluated. This concurrent approach needs to be adopted across all processes and will yield positive results. Another example is in Design & Development cases wherein the commercial RFP process sets in after the trials are over. In such cases the vendors are restricted to the nominated Development cum Production Partners (DcPPs), so why not issue the RFP at commencement of trials rather than wait for trials to end.

(d)          Qualitative Requirements often pose typical situations especially where it is a multi-vendor case and compliance by all in all of the parameters becomes a decision dilemma also leading to retrials and delays. Diligent articulation of parameters along with factoring Essential Parameters as well as Enhanced Performance Parameters will alleviate this. PSQRs in D&D and Make cases have scope of flexibility and spiral acceptance but here too a rigid tendency has setback some projects.

(e)          The L1 approach often criticised in favour of QCBS is not completely out of merit but it is to be appreciated that QCBS articulation and assigning weightages is not too simplistic as it is made out to be. The Essential Parameters A and B as also Enhanced Performance Parameters provisions with a TEC threshold cut off has the potential to select what is the best rather than what is the lowest cost.

(f)           The need to infuse R&D funds in the private sector. Though not much has happened but the existing provisions in the form of prototype funding in MAKE I have not been fully exploited. What more is needed? On the other hand, MAKE II in which no funding is offered has number of projects which are yet to fructify for various reasons, primarily technology maturity and capability.

(g)          Strategic Partnership enables potent capability in four sectors but has not been leveraged.

Agile DAP – Enablers And Possibilities

The agility is reflected in the ability of the organisation, decision making structures and people manning the processes to exploit the adaptability virtues. Agility means that the decision making, monitoring, oversight and responsiveness is driving the process rather than the process driving the outcomes! So, while the processes and procedures keep getting refined the organisation and structures driving the process remain the same. A few pointers to move ahead: –

1. The fragmented and diffused structures with responsibility and accountability in grey zone make the process guilty. There are far too many stakeholders who may be right in their own silos but their stance does in no way contribute to drive to the outcomes. There is also a rightful aversion in crossing lines across the stakeholders and in such a scenario it is only If and when all come on the same page will the case move up the ladder. Thus, Structural Reforms for acquisition are imperative which are integrated and process friendly.
2. The team manning these structures have to be professionals in operational, technical, financial, legal, commercial with a clear outcome-oriented approach. This has to come with clear ownership and performance linked leadership. The stability in tenures and institutional memory has to be strengthened as there are a number of instances where the cases fall due to a de novo approach which does not really help. The US Army Futures Command is a good model to adopt with cross functional teams with clear mandates.
3. The proclamation after each DAC meeting highlighting the value of AoNs accorded steals the headlines but seldom gives solace to the user or the industry. How should this AoN be agile? The AoN should include a Project Manager by name for that case/proposal and assign targets and milestones. This is the only way the ownership and timely monitoring can be driven.  Besides the project manager, the team representing various stakeholders should also be spelled out and the outcomes should flow from this team driving the project rather than operate in silos. This should be deemed as an empowered committee to execute the AoN as also give a status update to the DAC on completion of milestones or any delays.
4. There is a lot of potential for technology to be exploited and infuse agility. A simple example- the CnC which does take very long is an ideal process for evolving a technology driven pricing and negotiating strategy. Models for generating RFIs, evaluation of RFPs, generating TECs are easily doable. Trials in actual operating conditions cannot be always done away with but technology has a significant role to fast track this.

Way Ahead

“Find Purpose Means Will Follow,” said Mahatma Gandhi. The intent and focus have to be clear – how to go through the process to reach the desired outcomes. It is time that the focus be shifted from the beaten path of picking up on reforms on processes and procedures and start looking at skill development and reforming structures. An autonomous body as once recommended by a study – Pritam Singh Committee or a more evolved autonomous yet integrated framework within the MoD but with clear outcomes and delivery enablers incorporating the best practices needs to be set up. To summarise, the resurgence of DAP in quick succession over last two decades has not yielded much and hence let this exercise be transformative and holistic in true sense.  A few macro issues are flagged: –

• AoNs to incorporate integrated team, milestones and timelines.
• Strategic Partnership and MAKE I routes to be prioritised.
• IDDM to be incentivised.
• Indigenous Content to be technology oriented as against only cost oriented.
• Fostering Industry Domain expertise-land systems, aerospace, ammunition, maritime etc – something on the lines of Maharatna, Navratna and Miniratna CPSEs with not only financial gates but also technology and capability mapping.
• Option to exercise L1 or QCBS evaluation criteria.
• An Integrated High Altitude Testing Facility to be set up under the aegis of DRDO.
• Qualitative Parameters articulation to filter and reward superior performance as against minimum threshold acceptable.
• Industry friendly clauses on Price Variations, Early Deliveries, Liquidated Damages etc to be incorporated.

With the bold reforms in defence sector announced in 2020 and focus on indigenisation and an export outlook there is no stopping the vibrant and enthusiastic defence industry. The Research Development and Innovation (RDI) Scheme with a corpus of Rs. One lakh Crore announced recently by the Government recognises the critical role that the private sector plays in driving innovation and commercialising research. This scheme which aims to provide long-term financing or refinancing with long tenures at low or nil interest rates to spur private sector investment has been designed to overcome the constraints and challenges in funding of private sector. The defence industry stands to benefit a lot.