Government approves major changes in Defence Procurement Procedure

 >> Government of India has approved major changes to the Defence Procurement Procedure (DPP).

>> The Defence Acquisition Council, DAC chaired by Defence Minister Manohar Parrikar met in New Delhi to discuss the new DPP and gave its approval to the changes.

>> Defence Minister Mr Parrikar said, they have finalised the DPP 2016 and the major part of the changes have been approved. The new DPP will streamline defence acquisitions and give a big impetus to indigenisation through the 'Make in India' initiative.

Highlights of the new procurement policy

>> A new category has been created to promote domestic manufacturing, including government funding for Research & Development and recognition of the Micro, Small and Medium Enterprises in technology development.

>> The new DPP provides for increase in contract threshold from Rs 300 crore to Rs 2,000 crore for offsets.

>> It Allows government funds up to 90 per cent of development costs to private companies to push research and innovation, and aims to enhance private sector participation and speed up procurement process.

>> It has also brought down the Acceptance of Necessity validity to six months from earlier one year, which means that the forces will have to issue tenders faster.

>> The Defence Ministry has also approved changes its L1 policy of selecting lowest bidder. Under the new move, 10 per cent extra weightage will be given if a system displays better qualities than required. (The Hindu)