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National Seminar on Defence Acquisition

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  • October 27, 2009
    Conference
    Only by Invitation
    1000 hrs to 1630 hrs

    Programme

    Inauguration (10.00-11.00 hrs)
    Opening Remarks: Director General, IDSA
    Address: Shri V.K.Misra, Former Secretary, Defence Finance
    Address: Shri K Subrahmanyam, Former Secretary, Defence Production & Director, IDSA
    Special Address: Shri Shilabhadra Banerjee, Former DG (Acq.) & Secretary (Tourism)
    Keynote Address by Hon’ble Raksha Mantri
    Vote of Thanks
    Tea

    Session I: QR Formulation and Capability Definition (1100-1230 hrs)

    Chair: Air Marshal S. C. Mukul, PVSM, AVSM, VM, VSM

    • The challenges of capability definition and cost efficient QR formulation
      Speaker
      : Air Cmde. R. K. Dhir
    • Surveying the state-of-the-art weapon system availability/Merits of RFI system
      Speaker
      : Capt. Puneet Chadha, DSR, IHQ (Navy)
    • Firming up the “Buy”, “Buy & Make” and “Make” decision and Relevance of the pre-feasibility study
      Speaker
      : Shri Alok Perti, Additional Secretary (Coal)

    Session II: Technical and Commercial Evaluation Challenges: RFP format; Decision Matrix; and Negotiation (1230-1400 hrs)

    Chair: Shri Shilabhadra Banerjee, Former DG (Acq.) & Secretary (Tourism)

    • Paper evaluation of technical offers
      Speaker: Maj. Gen. (Retd.) I. S. Chaturvedi, TM (LS), MoD
    • A roadmap for time- and cost-bound trial evaluation under varied terrains and weather conditions
      Speaker: Speaker: Maj. Gen. Y. Sangra, Addl. Director-General (Artillery), IHQ (Army), Ministry of Defence
    • Commercial evaluation challenges/ The critical task of a comprehensive best and final commercial offer format/An optimal decision matrix
      Speaker: Smt. Shobhana Joshi, Joint Secretary & Additional FA, MoD

    Lunch (1400 - 1500 hrs)

    Session III: Complex Project Management (1500-1630 hrs)

    Chair: Shri V.K. Misra, former Secretary, Defence Finance

    • The challenges of contract/project implementation
      Speaker: Dr. S. C. Pandey, Additional FA (R&D) and JS, MoD
    • An appropriate monitoring/evaluation/course correction entity
      Speaker
      : Smt. Anuradha Mitra, Additional Financial Adviser (AM) & JS, MoD
    • Selected International Experiences in Arms Acquisition for a Way Forward
      Speaker:
      Shri Ravinder Pal Singh, Defence Analyst and Former Project Leader on Arms Procurement, SIPRI

    Concept Note

    With the successive increase in India’s defence budget, the Capital Acquisition budget has also grown phenomenally over the years. During the last decade (1999-2000 to 2008-09), the defence capital acquisition budget has grown by nearly four-fold to little less than Rs. 37,500 crores, thus indicating the nation’s collective effort and commitment to modernise its armed forces.

    The increase in defence capital budget notwithstanding, acquisition of capabilities required by the defence forces within a stipulated time and at an optimal cost poses a major challenge before the defence establishment. Despite several reviews of Defence Procurement Procedure (Capital Procurement), undertaken in quick succession in the recent past by the Ministry of Defence, it is yet to fully ensure expeditious procurement within allocated budgetary resources. One indication of lack of expeditious procurement is the recurring underutilisation of resources earmarked under capital expenditure. As the new budget for 2009-10 reveals, nearly 15 per cent of the previous year’s capital budget remained underutilised at the stage of revised estimate. This together with an upward moving trend in surrender of funds, observed in the past few years, reveals inadequacies in the capital acquisition system which needs to be addressed to ensure that the armed forces are fully prepared.

    In a 2007 report, the Comptroller and Auditor General of India noticed a number of deficiencies plaguing India’s capital acquisition structure/procedure. The report observed inter alia deficiencies in acquisition planning and formulation of GSQRs (general staff qualitative requirements); inadequacies in vendor identification; lack of objectivity and fair play in technical evaluation; weaknesses in trial evaluation; lack of effective cost computation mechanism; and multiple agencies with dispersed centres of accountability. To overcome these inadequacies, the supreme auditor in turn recommended a number of measures which deserve serious consideration.

    One of the recommendations of the supreme auditor was to set up an integrated acquisition body encompassing “all the functional elements and specialisation involved under one head.” The Kelkar Committee Report of 2005 (Part-I) has also recommended in similar fashion and even gone to the extent of saying that a “body like DGA [of France] seems suitable in the Indian set up.” A DGA-like body in India however requires a major restructuring of the present set up. It is worth noting that besides France, other major developed countries, including the UK and Australia among others, have moved towards an integrated approach for defence acquisition. The idea behind such integrated approach is to ensure accountability under one head, provide “through life capability” while ensuring best value for money.

    The proposed run-up seminar on defence acquisition is the first of the three such seminars, aimed at examining the inadequacies in the Indian acquisition system. It will bring together practitioners, personnel from Armed Forces, R&D and Industry, and experts on the subject, on a common platform to discuss and debate with regard to streamlining India’s acquisition system. The run-up seminars will conclude with an international seminar involving, besides the Indian stakeholders, key functionaries from the MoD and armed forces of major developed counties and experts on the subject, to discuss the international best practices in defence acquisition. The major issues that will be discussed in these seminars include: QR formulation and capability definition; technical and commercial evaluation challenges; project management; empowering defence industrial and R&D base; efficient logistics management; responsibility and accountability of acquisition organisation/staff; and Life cycle cost.

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