The Draft proposes higher indigenous content, incentives for local material and software as a part of ‘Make in India’
After Sales Support to be part of Capital Acquisition Contract Leasing of defence equipment introduced for the first time Emphasis on product export under offsets. Incentive under offsets for units in Defence corridor Posted On: 20 MAR 2020 5:59PM by PIB Delhi
Raksha Mantri Shri Rajnath Singh today unveiled the draft Defence Procurement Procedure (DPP) 2020 that aims at further increasing indigenous manufacturing and reducing timelines for procurement of defence equipment.
These and several other such innovative measures were part the Draft finalized by a high-level committee headed by DG Acquisition, Ministry of Defence that was set up in August 2019.
Boost to ‘Make in India’ Speaking on the occasion, Raksha Mantri said, “Our aim is to make India self-reliant and a global manufacturing hub. The government is constantly striving to formulate policies to empower the private industry including MSMEs in order to develop the eco-system for indigenous defence production. The defence industry of India is a strategically important sector having huge potential for growth. It needs to be the catalyst for India’s economic growth and realisation of our global ambitions.”
Shri Rajnath Singh added, “With the experience gained by the industry and the Ministry of Defence (MoD), it is now time to take further steps to strengthen ‘Make in India’ initiative, refine Life Cycle Support of procured equipment & platforms and hasten the defence acquisition process by further simplifying the procedures & reducing the overall procurement timelines.”
The major changes proposed in the new DPP are: Indigenous Content ratio hiked In view of the experience gained by the domestic industry, the Draft proposes increasing the Indigenous Content (IC) stipulated in various categories of procurement by about 10% to support the ‘Make in India’ initiative. A simple and realistic methodology has been incorporated for verification of indigenous content for the first time.
Use of raw materials, special alloys and software incentivised as use of indigenous raw material is a very important aspect of ‘Make in India’ and Indian Companies are world leaders in software.
Assurance of procurement on a single vendor basis from Aero Engine manufacturing unit and chips from FAB manufacturing units established in the country.
New Category Buy (Global – Manufacture in India) has been introduced with minimum 50% indigenous content on cost basis of total contract value. Only the minimum necessary will be bought from abroad while the balance quantities will be manufactured in India. This would be in preference to the ‘Buy Global’ category as manufacturing will happen in India and jobs will be created in the country.
Leasing introduced as a new category Leasing has been introduced as a new category for acquisition in addition to existing ‘Buy’ & ‘Make’ categories to substitute huge initial capital outlays with periodical rental payments. Leasing is permitted under two categories i.e, Lease (Indian) where Lessor is an Indian entity and is the owner of the assets and Lease (Global) where Lessor is a Global entity. This will be useful for military equipment not used in actual warfare like transport fleets, trainers, simulators, etc.
A new Chapter is introduced for procurement of software and systems related projects as in such projects, obsolescence is very fast due to rapid changes in technology and flexibility in the procurement process is required to keep up with the technology.
A new Chapter is introduced for Post Contract Management to facilitate and provide clear guidelines for issues arising during the contract period as typically Defence contracts last for a long period.
Timelines for procurement reduced by reducing the process for accord of Acceptance of Necessity which would be single stage of projects less than Rs.500 crore and in case of repeat orders. Trial methodology and Quality Assurance Plan to be part of RFP.
Field Evaluation Trials to be conducted by specialised trial wings and the objective of trials will be to nurture competition rather than elimination for minor deficiencies.
A comprehensive Chapter introduced for ‘Make’ to cover procurement from manufacturers in India including start-ups and innovators and from research projects of DRDO.
Product support The scope and options for Product Support have been widened to include contemporary concepts in vogue, namely Performance Based Logistics (PBL), Life Cycle Support Contract (LCSC), Comprehensive Maintenance Contract (CMC), etc to optimise life cycle support for equipment. The capital acquisition contract would normally also include support for five years beyond the warranty period.
The draft of DPP 2020 has been prepared by a Review Committee headed by Director General (Acquisition) based on the recommendations of all stakeholders, including private industry. In order to accrue advantage of domain specialisation of various subject matter experts, eight sub-committees headed by Lt Gen/equivalent officers were constituted to assist the review committee. These committees carried out extensive deliberations and interactions over a period of six months to formulate their respective charters. The draft has now been uploaded on the Ministry of Defence (MoD) website (https://mod.gov.in/dod/defence-procurement-procedure) for further suggestions from all stakeholders by 17th April 2020.
The first DPP was promulgated in 2002 and has since been revised a number of times to provide impetus to the growing domestic industry and achieve enhanced self-reliance in defence manufacturing.
Defence Secretary Dr Ajay Kumar and Director General (Acquisition) Shri Apurva Chandra also addressed the gathering on the salient features of Draft DPP. Raksha Rajya Mantri Shri Shripad Naik, Secretary (Defence Production) Shri Raj Kumar and other senior civil and military officials who were part of the sub-committees which drafted the Draft DPP 2020 were present on the occasion.
Modified offset guidelines proposed to give emphasis on export of products rather than components. Higher multipliers proposed for procurement from MSMEs and units established in Defence Industrial Corridors. Higher multipliers proposed for Transfer of Technology to private Companies / DPSUs / OFB and DRDO.
The scheme will be implemented in Udaipur, Pratapgath, Banswara and Dungarpur, where nutrition indicators among children and anaemia levels among mothers are worse than the average for the State.
Key features of the scheme: It is a maternity benefit scheme. Under the scheme ₹6,000 will be offered for the birth of the second child. The government aims to reach out to 75,000 beneficiaries annually. It estimates an expenditure of ₹45 crore per year.
The State scheme will complement the Central government’s Pradhan Mantri Matru Vandana Yojana which offers ₹5,000 for the birth of the first child.
Why focus on second child? The government feels that the second child doesn’t receive as much attention as the first child and, therefore, it is important to extend this cash benefit to ensure adequate nutrition for the second child.
About PMMVY: It is a maternity benefit rechristened from erstwhile Indira Gandhi Matritva Sahyog Yojana (IGMSY). The scheme is a conditional cash transfer scheme for pregnant and lactating women. It provides a partial wage compensation to women for wage-loss during childbirth and childcare and to provide conditions for safe delivery and good nutrition and feeding practices.
The petition sought the court’s intervention for extending the post-retirement restrictions imposed on the office of the Lokpal to former judges as well.
What is the demand by the petitioner? The petition said former judges should be insulated from “post-retirement allurements” like the Lokpal, as faith in the judiciary will dry up.
What’s the issue here? There is no law or constitutional provision that prohibits such a nomination. Nor is this an unprecedented decision by the government. Still, it is not a common practice that a government nominates or appoints a former Supreme Court judge or even a high court judge to some office within months of her or his retirement.
What are the exceptions currently in place to ensure independence of the judiciary? Currently, the only bar imposed on a Judge of the Supreme Court who has retired is that he shall not thereafter plead or act in any Court or before any authority.
What has the Law Commission said in this regard? 14th report of the Law Commission of India considered the question of such nominations and appointments before forming a negative opinion. The report said it is clearly undesirable that Supreme Court Judges should look forward to other Government employment after their retirement.
Explaining the reason for why Supreme Court judges should resist such offers from the government, the Law Commission report says, “The Government is a party in a large number of causes [cases] in the highest Court and the average citizen may well get the impression, that a judge who might look forward to being employed by the Government after his retirement, does not bring to bear on his work that detachment of outlook which is expected of a judge in cases in which Government is a party.”
Therefore, the practice has a tendency to affect the independence of the judges and should be discontinued.
Why Ranjan Gogoi should not have accepted this offer? Within five months of his retirement as Chief Justice of India, Justice Ranjan Gogoi has been nominated to the Rajya Sabha by the government.
Shortly before his retirement from the Supreme Court of India, he delivered several important verdicts with far-reaching political consequences that left the government pleased, including the Ayodhya judgment.
Before that, Justice Gogoi dismissed a review of the Rafale fighter aircraft deal without substantially dealing with the grounds on which the original judgment, negating an independent investigation, had been challenged.
During his tenure, Justice Gogoi also presided over and pushed through the National Register of Citizens (NRC) in Assam, an exercise that has excluded more than 19 lakh people from the final version of the citizenship register, and which has been widely criticised on several grounds.
Then there was the Sabarimala temple review. A Constitution Bench judgment of the Supreme Court held that excluding menstruating women from entering the temple was discriminatory, and therefore against “constitutional morality”.
What the 16-point code of conduct for judges says? Also called the “Restatement of Values of Judicial Life” (adopted at a Chief Justices Conference in May 1997), the code lays the basis of how post-retirement conduct ought to be. For example if a judge after deciding politically sensitive cases involving particular political parties or politicians, soon after retirement seeks and gets a plum post such as a Rajya Sabha nomination by those very politicians or parties, it would obviously raise serious questions about his or her independence as a judge when he or she had decided those cases.
Can this appointment be seen as a way of ensuring cohesion between the judiciary and the legislature? No. Because, he no longer represents the judiciary, and his contribution will be limited to the expertise and knowledge he can bring to debates in Parliament. Any attempt to create ‘cohesion’ between the two wings would necessarily encroach on the judiciary’s role as a restraining force on the executive and legislature.
Need of the hour: There is a creeping worry that post-retirement jobs are a result of pre-retirement judgments. Above all, public confidence in the judiciary cannot be shaken through such appointments. The issue needs to be resolved convincingly.
Besides, ethics demand that no retired judge of the highest court accepts a post that will room to criticism and controversy.
Nominated member of the Rajya Sabha: Under article 80 of the Constitution, the Council of States (Rajya Sabha) is composed of not more than 250 members, of whom 12 are nominated by the President of India from amongst persons who have special knowledge or practical experience in respect of such matters as literature, science, art and social service.
What’s the issue? The apex court took this decision after Speaker Y. Khemchand Singh, even after the one month”s period given by the apex court, failed to decide on the disqualification petition pending against Shyamkumar. Instead, the Speaker sought adjournment for eight weeks on the matter.
What is Article 142? Article 142 “provide(s) a unique power to the Supreme Court, to do “complete justice” between the parties, i.e., where at times law or statute may not provide a remedy, the Court can extend itself to put a quietus to a dispute in a manner which would befit the facts of the case.
Article 142(1) states that “The Supreme Court in the exercise of its jurisdiction may pass such decree or make such order as is necessary for doing complete justice in any cause or matter pending before it, and any decree so passed or order so made shall be enforceable throughout the territory of India in such manner as may be prescribed by or under any law made by Parliament and, until provision in that behalf is so made, in such manner as the President may by order prescribe”.
The Bill seeks to repeal the Indian Medicine Central Council Act, 1970.
Within three years of the passage of the Bill, state governments have to establish State Medical Councils for Indian System of Medicine at the state level.
Key features of the Bill include: Constitution of the National Commission for Indian System of Medicine: The NCISM will consist of 29 members, appointed by the central government. These posts will have a maximum term of four years.
They will be recommended by a search committee. The Search Committee will consist of five members including the Cabinet Secretary and three experts nominated by the central government (of which two should have experience in any of the fields of Indian System of Medicine).
Functions of the NCISM include: Framing policies for regulating medical institutions and medical professionals of Indian System of Medicine.
Assessing the requirements of healthcare related human resources and infrastructure. Ensuring compliance by the State Medical Councils of Indian System of Medicine of the regulations made under the Bill. Ensuring coordination among the autonomous boards set up under the Bill.
Autonomous boards to be set up: Board of Ayurveda and the Board of Unani, Siddha, and Sowa-Rigpa. Medical Assessment and Rating Board for Indian System of Medicine. Ethics and Medical Registration Board.
Entrance examinations: There will be a uniform National Eligibility-cum-Entrance Test for admission to under-graduate education in each of the disciplines of the Indian System of Medicine in all medical institutions regulated by the Bill.
The Bill also proposes a National Teachers’ Eligibility Test for postgraduates of each discipline of Indian System of Medicine who wish to take up teaching that particular discipline as a profession.
The Bill seeks to repeal the Homoeopathy Central Council Act, 1973.
Key features (Note: Have a brief overview.) Constitution of the National Commission for Homoeopathy: It will consist of 20 members, appointed by the central government and recommended by a Search Committee.
The Search Committee will consist of six members including the Cabinet Secretary and three experts nominated by the central government (of which two will have experience in the homoeopathic field).
Within three years of the passage of the Bill, state governments will establish State Medical Councils for Homoeopathy at the state level.
Functions of the National Commission for Homoeopathy: framing policies for regulating medical institutions and homoeopathic medical professionals, assessing the requirements of healthcare related human resources and infrastructure.
Appeal on matters related to professional and ethical misconduct: State Medical Councils will receive complaints relating to professional or ethical misconduct against a registered homoeopathic medical practitioner. If the medical practitioner is aggrieved of a decision of the State Medical Council, he may appeal to the Board of Ethics and Medical Registration for Homoeopathy.
Powers: The State Medical Councils and the Board of Ethics and Medical Registration for Homoeopathy have the power to take disciplinary action against the medical practitioner including imposing a monetary penalty.
Appeals: If the medical practitioner is aggrieved of the decision of the Board, he can approach the NCH to appeal against the decision. Appeal of the decision of the NCH lies with the central government.
Basis for NRC- observations of Home Ministry: It is the responsibility entrusted with the Central government “to identify/detect illegal migrants and thereafter, follow the due process of law”. The Foreigners Act, 1946, confers upon the government the power to expel foreigners from India.
It vests the Central government with absolute and unfettered discretion, and as there is no provision fettering this discretion in the Constitution, an unrestricted right to expel remains.
Background: More than a dozen States have vociferously opposed the updating of National Population Register (NPR), slated to begin on April 1 along with the house listing phase of the Census. According to Citizenship Rules 2003, NPR is the first step towards the compilation of the NRC.
Concerns now: There are fears that the CAA, followed by a country-wide NRC, will benefit non-Muslims excluded from the citizens’ register, while excluded Muslims will have to prove their citizenship. The government has denied that CAA and NRC are linked.
How it would be carried out? Details of how such an exercise will be carried out are not yet known. In the case of Assam, there was a cut-off date — March 25, 1971 — after which all foreigners as per the Assam Accord were to be “detected, deleted and expelled in accordance with law”.
Presumably, the Centre will come out with a cut-off for the nationwide NRC, but it will be an arbitrary one.
Why this is worrisome? Assam’s example: This is an exercise fraught with risks, as the example of Assam shows. The process in the state has been mired in inaccuracies, with low but worrying odds of legal citizens being declared illegal residents in their own country.
Need of the hour: Any such exercise demands a robust process that minimizes data infirmities. This would mean a complete rehaul of the methods used in Assam. Also, those who don’t make it to the list should get adequate legal recourse.
What is NRC? The NRC is the list of Indian citizens and was prepared in 1951, following the census of 1951. The process of NRC update was taken up in Assam as per a Supreme Court order in 2013.
In order to wean out cases of illegal migration from Bangladesh and other adjoining areas, NRC updation was carried out under The Citizenship Act, 1955, and according to rules framed in the Assam Accord.
India’s CBM potential: India has the fifth-largest coal reserves in the world, and CBM has been looked at as a clean alternative fuel with significant prospects.
India’s CBM resources are estimated at around 92 trillion cubic feet (TCF), or 2,600 billion cubic metres (BCM).
The country’s coal and CBM reserves are found in 12 states of India, with the Gondwana sediments of eastern India holding the bulk. The Damodar Koel valley and Son valley are prospective areas for CBM development.
What is coalbed methane (CBM)? It is an unconventional form of natural gas found in coal deposits or coal seams. CMB is formed during the process of coalification, the transformation of plant material into coal.
CBM can be used: In Power generation. As Compressed natural gas (CNG) auto fuel. As feedstock for fertilisers. Industrial uses such as in cement production, rolling mills, steel plants, and for methanol production.
Challenges and concerns: Methane is a greenhouse gasemitted through CBM extraction. Global methane emissions from coal mines are projected to account for approximately 8 percent of total global methane emissions.
Disturbance of lands drilled and its effect on wildlife habitats results in ecosystem damage.
CBM production behaviour is complex and difficult to predict in the early stages of recovery.
Another concern is the effect water discharges from CBM development could potentially have on downstream water sources. Disposal of the highly salinized water that must be removed in order to release the methane creates a challenge, as its introduction into freshwater ecosystems could have adverse effects.
Open market operations is the sale and purchase of government securities and treasury bills by RBI or the central bank of the country.
The objective of OMO is to regulate the money supply in the economy.
RBI carries out the OMO through commercial banks and does not directly deal with the public.
What is it? To counter corruption and speed up decision- making in military procurement, the government of India in 2001 decided to set up an integrated DAC. It is headed by the Defence Minister.
Objective: The objective of the DAC is to ensure expeditious procurement of the approved requirements of the Armed Forces, in terms of capabilities sought, and time frame prescribed, by optimally utilizing the allocated budgetary resources.
Functions: The DAC is responsible to give policy guidelines to acquisitions, based on long-term procurement plans. It also clears all acquisitions, which includes both imported and those produced indigenously or under a foreign license.
Railway Projects are sanctioned Zone-wise and not State-wise, as, Indian Railway’s network is straddled across various State boundaries.
Till 22nd August, 2014, Foreign Direct Investment (FDI) in Railway Sector was restricted only to “Mass Rapid Transport System”. However, FDI has now been opened up/permitted in the following activities/areas of Railway Infrastructure (100% on automatic route) under the extant FDI Policy of Government since 22 August, 2014.
By virtue of Entry 9 and 41 of State List in the Seventh Schedule of the Constitution of India, the respective States are required to implement the provisions relating to reservation for Persons with Disabilities (PwDs) in their establishments.