NEWS

Ministry of Defence (MoD) has offered four projects to the Indian Industry for design & development under Make-I category of Defence Acquisition Procedure (DAP) 2020.

Make-I category

The industry will be provided financial support for prototype development of these projects.

The list of projects which were accorded ‘Approval In-Principle (AIP)’ by Collegiate Committee of MoD is as follow:

• Indian Air Force: Communication Equipment with Indian Security Protocols (Routers, Switches, Encryptors, VoIP Phones and their software)
• Indian Air Force: Airborne Electro Optical pod with Ground Based System
• Indian Air Force: Airborne Stand-off Jammer
• Indian Army: Indian Light Tank

This is for the first time since the launch of DAP-2020 that Indian Industry has been involved in development of big ticket platforms such as Light tank and Communication Equipment with Indian security protocols.

Make-II procedure

In addition, AIP has also been accorded to following five projects under industry-funded Make-II procedure:

• Indian Air Force: Full Motion Simulator for Apache Helicopter
• Indian Air Force: Full Motion Simulator for Chinook Helicopter
• Indian Air Force: Wearable Robotic Equipment for Aircraft Maintenance
• Indian Army: Integrated Surveillance and Targeting System for Mechanised Forces
• Indian Army: Autonomous Combat Vehicle

Projects under ‘Make-II’ category involve prototype development of equipment or their upgrades or their components, primarily for import substitution/innovative solutions, for which no Government funding will be provided for prototype development purposes.

DAP 2020 – HIGHLIGHTS

• Reservations for Indigenous firms
• Defines an “Indian vendor” as a company that is owned and controlled by resident Indian citizens, with foreign direct investment (FDI) not more than 49 per cent.
• Stipulates indigenisation of at least 50 per cent of the overall contract value of a foreign purchase bought with the intention of subsequently building it in India with technology transfer
• Meeting the difficult indigenisation requirement would force the vendor to build the equipment in India, rather than supply most of it ready-built from abroad.
• Promotes greater indigenous content in arms and equipment of the military procures, including equipment manufactured in India under licence. In most acquisition categories, DAP-2020 stipulates 10 per cent higher
• Indigenous content will now be calculated on ‘Base Contract Price’, that is Total Contract Price, less taxes and duties
• The “import embargo list” of 101 items that the government promulgated last month has been specifically incorporated into DAP 2020
• The government has decided not to have an offset clause in procurement of defence equipment if the deal is done through inter-government agreement (IGA), government-to-government or an ab initio single vendor.
• The offset clause requires a foreign vendor to invest a part of the contract value in India.