Advisory body needed on defence purchases

It was long thought that nuclear, space and missile programmes will give us security and stability. However, the instability due to the threats from China and Pakistan has increased recently. This is happening at a time when the coronavirus pandemic is devastating our economy. The Prime Minister has responded to the pandemic with the “Atma Nirbharta” call. Thereafter, the finance minister and the Chief of Defence Staff, in a major shift on future defence procurement, emphasised the need to handhold the Indian defence industry. As a result, India must now indigenise weapons procurement, in recessionary conditions given the reduced budgets. The available budgets must cater for old and emerging technologies. Overall, India is in a strange “stability-instability” paradox where we can’t let our guard down even a bit despite the pandemic.

We therefore need to reduce imports through import substitution of small parts and components, upgradation of existing equipment and reverse engineering of certain weapons. We must increase emphasis on quality and cost-effectiveness to cut down on expenditure. There can also be no letup in our procurement and modernisation, lest we are left vulnerable against our adversaries. It’s a major conundrum. Extensive interaction with experts indicates we are in difficult times. There is also a consensus that there is a need to focus on defence capital procurement, which is likely to go off track.

Capital acquisition of any major weapon system is a “decadal process”. It demands great expertise and sustained application to get results. Hence, the response to the emerging situation needs intellectual clarity and a sense of purpose to shorten timeframes. There must be a two-pronged approach. The first is to resolve cases and clear critical capacity enhancers within available budgets. The second pertains to processing cases till the contract stage for execution when budgets are enhanced. Indigenisation should be the underpinning watchword in all this.

Defence capital procurement has suffered due to many reasons, which have often been analysed. But there are some fundamental problems in execution. Our monitoring and review systems are weak. Accountability and transparency are an issue. Indigenisation focus has been lacking. Theoretically, the Defence Acquisition Council and Defence Procurement Board are supposed to cater to all these issues. However, in practice it doesn’t happen, so cases languish. Acceptance of Necessities lapse. Request for Proposals remain under preparation. Cost Negotiation Committees continue interminably. The trials never end.

A major long-term change is warranted. However, at present we do not have the luxury of time to effect long-term changes. Business as usual is also not an option. Our response should be such that any change done now should meet our immediate needs and lead to a longterm change.

There is another basic flaw which too needs rectification. The people who operate our procurement system are transitory and transactional. Very often they are inhibited by lack of expertise. It’s not due to any individual shortcomings but more often due to short tenures, lack of background or holistic understanding or simply due to work pressure. The crux is that a transitory system with a weak knowledge base handles complex issues of a longstanding nature. Such problems must be handled by experts on a sustained basis. Our periodic response to problems has been to amend the DPP. With each review and a new DPP, the system has only become more complicated and counterproductive.

There is a dire requirement for an expert body to assist the defence procurement process. It is recommended that a Defense Procurement Advisory Board (DPAB) be established. The national security adviser and the National Security Council have an advisory board of experts assisting them. The defence ministry should similarly have a DPAB. Under the circumstances, it is almost mandatory to have one.

The proposed DPAB should consist of experts whose main tasks would be to analyse, review and monitor cases and offer advice on prioritisation of schemes. They should throw up least-cost options in the best possible timeframes to increase operational preparedness at minimum risk. They should catalyse situations and speed up processes. They would lead in building institutional knowledge on indigenisation and procurement. They would also enable identification of relevant technologies essential to defense procurement — indigenous or otherwise. They would be critical to time, cost and financial assessments. They would promote joint procurement. This body should be empowered, relevant to the context, and handson with current cases. The DPAB should have the wisdom to kickstart long-term reforms of the procurement system. In specific cases, the DPAB’s advice should be of binding nature. The DPAB could work under the CDS or the Raksha Mantri. It can even advise the NSA-chaired Defence Planning Committee.

The DPAB should be staffed by experts, by reputation, wisdom, integrity, capability, and a proven track record in procurement. A balance of technological and operational knowledge with acumen is mandatory. The body should have representation from all the services, one civil service officer and a finance specialist. It shouldn’t be a post retirement lollipop. A proven track record of indigenisation will be good. A 360degree view must be taken from the environment before appointing members. There is only one interested entity for which the board should work in a bipartisan manner — India. The representation of interested parties on the board should be avoided. Any input from the DRDO, industry and PSUs, who are interested parties, can be taken on a case-by-case basis. Personally, I would like to see this board working on a honorary basis. At some stage, we must put this cause beyond money or compensation.

This is the minimal topdriven reform in procurement which can be effective immediately, without hassles to progress capital acquisitions in the correct timeframe and direction and carry out modernisation in tight budget conditions. The time for “business as usual” is over.

A proven track record of indigenisation will be good. A 360-degree view must be taken from the environment before appointing members. There is only one interested entity for which the board should work in a bipartisan manner — India.