ATMANIRBHAR IAS

Date: 09-10-2020

 NEWSPAPER
EDITORIAL
NOTES
 RSTV Summary

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 TABLE OF CONTENTS

SR. TOPIC GS PAPER SOURCE

NO.
1. Amendments to the
Defence Acquisition
Procedure (DAP 2020)
2. Keeping Vigilance even
during unusual times
GS 3- Government RSTV: The Big
policies and Picture
interventions for
development in various
sectors and issues
arising out of their
design and
implementation
GS 2- Appointment The Hindu
to various
Constitutional posts,
powers, functions and
responsibilities of
various Constitutional
Bodies.

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Amendments to the Defence Acquisition Procedure (DAP 2020)

Context: Recently (September 2020) a new Defence Acquisition Procedure 2020 was released by
Ministry of Defence. Previously a Defence Procurement Policy 2016 was launched which focused on
indigenously designed and developed weapon system. The new policy tries to fill gaps that were present
in the 2016 policy.

Major Changes:

a) New category of acquisition “leasing” introduced which would help in cost cutting in defence
export. Previously there was only ‘Buy’ and ‘Make’ category. Now monthly rental payments can
be made instead of huge capital investments.

b) The “offset clause” has been removed in government-to-government, single vendor and
Intergovernmental Agreements (IGA).

 Offsets are a portion of a contracted price with a foreign supplier that must be re-
invested in the Indian defence sector.
 Foreign vendor was required to invest at least 30% of the value of the contract in India.
 According to CAG report offset clause was hindering technology transfer in India

c) Focus on domestic industry, indigenous content percentage has been increased across
category.

CATEGORY DPP 2016 DAP 2020

BUY (INDIAN IDDM) Min 40% Min 50%
BUY (INDIAN) Min 40% Indigenous Design – Min 40%
Otherwise – Min 60%

BUY & MAKE (INDIAN) Min 50% of Make Min 50% of Make
BUY (GLOBAL & MFG *NEW* Min 50%
INDIAN)

BUY (GLOBAL) *NEW* Min 30% for Indian vendors

d) Simplification of ‘Trial Process’ - Trial process usually took years and was done by various
industries – now the process has been streamlined (acquistion time will greatly reduce).

e) ‘Inflation Correction’ clause has been added which will lead to compensation if the acquisition
takes longer and results into expenses owing to inflation losses due to delay.

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 f) ‘Negative List’ – i.e. only domestic suppliers will supply and the import of such items would be
banned.

g) R&D in cutting edge Technology like AI, Robotics has been given the push.

h) ‘Project Management Unit’ to be set up for time bound and more streamlined defence
procurement.

Conclusion:

Various other initiatives like setting up of ‘Export Promotion Council’, IDEX (Innovation for Defence
Excellence) have been taken up which along with the new Defence Acquisition Procedure 2020 will help
in self reliance in the defence field.

Keeping Vigilance even during unusual times

Question in focus:

With the nation spending substantial resources to manage the pandemic, what is the role of the supreme
audit institution of India, the Comptroller and Auditor General (CAG) of India?

Context:

Karnataka State Legislature’s Public Accounts Committee (PAC) directed the CAG to conduct a
special audit into the purchase of COVID 19 equipment within 15 days, highlights the role and
significance of the national audit office in these unusual times. The panel also asked the CAG to ‘conduct
an audit of expenditure incurred by the State government under the State Disaster Response Fund
(SDRF).

Issues:

 Allegation that funds (to the tune of ₹2,000 crore) were siphoned off to purchase inferior quality
of personal protective equipment kits, sanitisers, ventilators, masks and other equipment at prices
higher than those prevailing in the market.
 The opportunity to indulge in corruption exists in disaster management. Uttarakhand Flood of
2013 relief scam is one such example.
 Emergency procurement to save lives and reduce sufferings is a chance to obfuscate rules and
procedures, and can happen in all three tiers of governance.

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Mandate and Steps taken:

The CAG has the inescapable constitutional and statutory mandate and responsibility to ensure public
accountability, transparency, effective service delivery and good governance.

The CAG has issued an order creating a new vertical — health, welfare and rural development on
June 1, 2020, restructuring the office of the Director General of Audit, Central Expenditure.

A beneficiary survey will become part of the audit process to bring out efficacy of service delivery and
the availability and quality of drugs. Auditing ESI hospitals and dispensaries is expected to provide the
assured healthcare services including infection control and hygiene.

Advantages of such vigil by CAG:

 Prudent expenses during the ongoing pandemic.

 Audit recommendations can contribute improvements in various aspects of disaster preparedness,
management and mitigation.
 As the CAG’s performance audits are driven by economy, efficiency and effectiveness, the audit
will focus on expense tracking and achievement of outputs and outcome, in qualitative and
quantitative terms.
 The entire process of procurement of COVID-19 related equipment and drugs, proper
documentation, and compliance with rules and regulations can be streamlined with data analysis,
valuable inputs and practical recommendations.

If all the major purchases by government entities at all levels are audited by the CAG, there can be
substantial improvement in disaster management. It will usher in better transparency, integrity, honesty,
effective service delivery and compliance with rules and procedures and governance.

ATMANIRBHAR IAS

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