ibnlive » India

Mar 26, 2013 at 10:33am IST

After chopper scam, MoD plans to change procurement procedure

New Delhi: After the AgustaWestland scandal, the Defence Ministry is planning to tweak its procurement procedures. But insiders claim these changes are unnecessary and misplaced and reflect a knee jerk reaction from the government. South Block is abuzz with reports of an imminent change in the defence procurement procedures.

The changes will apparently favour domestic industry and give them the right of first refusal when it comes to building weapons and equipment indigenously. But former financial adviser in the Defence Ministry Amit Cowshish told CNN-IBN the changes being talked about appeared unnecessary.

"There is nothing new to be created in my opinion because buy and make Indian is here, you can opt for that under the existing system, no change is required in procedure except if you were to mandate that everything will be done through this route, then things are different. But it doesn't require any change in the procedure only in policy," Amit Cowshish said.

Industry insiders say the government needs to focus on correcting basic flaws in the DPP. There is no distinct Defence Procurement Policy. The current policy forms part of the Defence Procurement Procedures. It's not clear in what circumstances the government can opt for a certain category when procuring certain equipment nor is the government clear how to work with private industry and ensure it is not being overcharged.

"In the US, there is legislative sanction for various actions that they take, we don't have that. If I am not mistaken there is an organisation like the Defence Contract Auditing Agency, which goes and sits with the OEMs and audits their books of account and sees whether the price they are building up is correct or not," Cowshish said.

All this does give the impression the government may be seeking to divert attention from the gathering scandal over bribery allegations in the AgustaWestland affair. The point also being made is that giving greater weightage to Indian industry is no guarantee of higher standards of probity.