Indian Defence Review

Defence Research and Development Organisation and its Veto Power

All proposals initiated by the services for procuring new equipment for modernisation are first considered by the Defence Acquisition Council (DAC) which categorises them as ‘Buy’ or ‘Buy and Make’ or ‘Make’. In other words, a decision is taken whether the sought equipment is to be purchased outright or partial quantity purchased with import of technology or is to be developed indigenously.

Determination of the lowest bidder is a highly unscientific and long drawn process as there is no standard matrix against which the commercial proposals can be evaluated.

No procurements from abroad can be carried out unless Defence Research and Development Organisation (DRDO), which is a member of all sanctioning boards, concurs that the product cannot be produced/developed in the country in the required timeframe. DRDO is generally wary of conceding this for two reasons. One, it reflects adversely on its research and development competence, and two, every import means loss of an opportunity to expand its own domain with associated budget. On numerous occasions, the services have been denied urgently required equipment because of DRDO’s claims of indigenous development. The recent case of Trishul, where the whole project had to be aborted after decades of promises and extended deadlines, proves it adequately.

Even if DRDO is able to make some progress in a few cases, it is always done with major compromises with respect to the stated qualitative requirements. The services are forced to accept sub-optimal equipment with the promise that subsequent deliveries would conform to the parameters. In any case, by the time equipment is developed and delivered, it becomes obsolete. Thus, the services are forced to live with outdated and useless equipment.

During the last 50 years, there has hardly been any equipment which DRDO has developed in the promised timeframe and conforming to the parameters. It has been a history of false claims, tall promises, unexplained delays and sub-optimal products. The services carry critical voids hoping that a war does not take place before the equipment materialises.

Over-Indulgence of the Public Sector

There are 39 Ordnance Factories and the Ordnance Factory Board is the largest departmentally run industrial undertaking in the country. In addition, MoD has nine Defence Public Sector Undertakings (DPSU). Despite getting preferential treatment from MoD, they have singularly failed to keep pace with worldwide developments. They thrive on periodic infusion of transferred technology and have developed no indigenous competence.

Even the boldest and the most conscientious officers fear subsequent enquiries. Decisions taken in good faith can always be questioned in retrospect.

In all ‘Buy and Make’ cases, recipient of imported technology is a DPSU (even if a private sector entity is more suited for it) entailing long delays, as the technology in question may be totally alien to it.

Interestingly, DPSU get to know military’s likely projections of equipment acquisitions in advance and promptly sign MOU with foreign vendors to preempt competition and present a fait accompli to the decision-makers. With assured orders in hand, no urgency is shown to produce quality goods in the promised timeframe.

Most unfortunately, the Indian military is a captive customer of the Indian public sector and is forced to buy what it produces. Very often the services are given only one option – ‘take whatever public sector offers or do without it’. In a way, the public sector has contributed directly to the current state of affairs where the armed forces are saddled with mediocre and outdated equipment.

Lack of Accountability

To date, no enquiry has ever been held to fix responsibility for causing delays in the procurement of any defence equipment. All functionaries are safe in the knowledge that they would never be called upon to justify their inaction. This has emboldened them to show no urgency whatsoever.

Most unfortunately, the Indian military is a captive customer of the Indian public sector and is forced to buy what it produces.

In late 1990s, India was on the verge of signing a contract for the import of Weapon Locating Radars (WLR) when DRDO intervened to stall it with claims that they were on the threshold of producing indigenous WLR. India went into the Kargil conflict without WLR and suffered considerable casualties. No one was held accountable for making misleading claims and making India lose precious lives.

Similarly, DPSU and Ordnance Factories generally fail to deliver quality goods as per the promised schedules, but have never been reproached or penalised for the same. On the other hand, stiff penalties are imposed on private sector vendors for delays in deliveries.

Fear of Subsequent Enquiries and Play Safe Syndrome

As every procurement decision gets questioned subsequently, many functionaries consider it prudent to defer decision-making. It is a common saying in official circles that the price to be paid for not taking a decision is far less than that for taking a decision. So why not play safe?

Even the boldest and the most conscientious officers fear subsequent enquiries. Decisions taken in good faith can always be questioned in retrospect. Therefore, even the empowered officers consider it prudent to keep seeking repeated approval of ‘higher ups’ at all steps to shield themselves. Another common practice is to mark all cases to superiors by endorsing ‘for information please’. It is a highly prevalent stratagem to keep seniors ‘in the loop’, so that they can also be roped in later on (see box).

Media

A totally independent media is the bedrock of true democracy. Media in India is doing an excellent job to highlight national security concerns. However, at times their coverage of defence deals is based on unverified facts.

Some segments of media carry stories which may have been planted by the vendors who fail to get orders.

Some segments of media carry stories which may have been planted by the vendors who fail to get orders. The aim of such vendors is to get the deal aborted and have the whole process started afresh. It is a highly widespread ploy in the world arms market, used effectively to sow seeds of doubts regarding the quality of selected equipment. It also raises suspicions regarding the earnestness of the entire evaluation process and hints at underhand dealings.

Media has to be objective in its coverage and support officials who are above board and are doing a difficult task with conscientiousness. It should not let itself be used by competing vendors to settle scores. Adverse coverage carried by them, wittingly or unwittingly, deters decision-making and delays procurements. No functionary wants his honesty and diligence questioned.

The Road Ahead

The basic problem lies in segmented approach towards the modernisation of the armed forces. Instead of adopting an integrated mission oriented approach, various organs of the Government tend to guard their own turf for narrow parochial interests. Due to a total lack of accountability, modernisation proposals suffer from gross neglect and bureaucratic delays. As seen above, blame for tardy pace of modernisation can be apportioned to all participating entities (including the services), albeit in varying degrees.

No one assigns any importance to speedy conclusion of a deal except the service concerned and the user directorate. It is sad to see senior service officers pleading with and humouring MoD officials to get their cases progressed.

No one assigns any importance to speedy conclusion of a deal except the service concerned and the user directorate. It is sad to see senior service officers pleading with and humouring MoD officials to get their cases progressed. They do rounds of offices carrying loads of files to answer queries, howsoever irrelevant and infructuous they may be. It is a very frustrating experience for many. Some service officers openly state that fighting bureaucratic quagmire is by far the most demanding activity they are required to undertake in the interest of their service.

One can have the best of organisations and ideal procedures in place but ultimately any organisation or procedure is as good as the people who work it. Therefore, the foremost requirement is to select acquisition staff diligently. No reforms can yield the desired results unless and until the implementing functionaries are equipped to translate good intentions into tangible actions on ground. Their lack of competence manifests itself in their reluctance to take decisions and for a propensity to involve maximum number of people.

It has generally been accepted the world over that an efficient acquisition work force can not only expedite procurements but also affect a saving of up to 15 percent of the capital expenditure in initial purchase price and associated life-cycle costs.

A system should be put in place to obviate requirement of repeated approvals at different stages of acquisition. Sanction of the designated approving authorities should be taken for the comprehensive proposal to preclude the necessity of repeated reference to them. Once approval of DAC is accorded, ‘acceptance of necessity’, ‘quantity vetting’ and finalisation of RFP should be carried out simultaneously to compress timeframe.

The new defence procurement procedure is well intended and addresses most of the critical issues, but its implementation needs streamlining. A number of steps can be taken within the existing structures and procedures to reduce delays considerably. Old mindsets and narrow prejudices must be replaced by collegiate functioning with individual accountability duly spelt out. Finally, evolution of well-analysed long-term plans and their diligent adherence are absolutely essential for continuity.