The Defence Acquisition Council (DAC), chaired by Defence Minister Rajnath Singh, on Thursday accorded Acceptance of Necessity (AoN) for capital acquisition proposals estimated at ₹70,500 crore
The AoN has been accorded for capital acquisitions under ‘Buy Indian-IDDM’ (Indigenously Designed, Developed and Manufactured)
Note: An Acceptance of Necessity is accorded by the Defence Ministry for a particular weapon system or equipment at the beginning of the procurement process.
Out of the total proposals, Indian Navy proposals constitute more than ₹56,000 crore, which largely includes indigenous BrahMos cruise missiles, Shakti Electronic Warfare (EW) systems, Utility Helicopters-Maritime among others.
A Long Range Stand-Off Weapon (LRSOW) for the Indian Air Force (IAF) to be designed and developed indigenously and integrated on SU-30 MKI fighters
The indigenous 155mm/52-Calibre Advanced Towed Artillery Gun System (ATAGS) along with High Mobility Vehicles (HMVs) and Gun Towing Vehicles (GTVs) for the Army.
Buy Indian-IDDM’ (Indigenously Designed, Developed and Manufactured)
It has been introduced in DPP-2016 (Defence Procurement Policy) to promote indigenous design and development of defence equipment. This category has been accorded top most priority for procurement of capital equipment. Besides this, preference is being given to ‘Buy (Indian)’ and ‘Buy and Make (Indian)’ categories of capital acquisition over ‘Buy (Global)’ & ‘Buy & Make (Global)’ categories.
Buy (Indian-IDDM) ‘Buy (Indian-IDDM)’ category refers to the procurement of products from an Indian vendor meeting one of the two conditions:
- Products that have been indigenously designed, developed and manufactured with a minimum of 40% Indigenous Content (IC) on cost basis of the total contract value
- Products having 60% IC on cost basis of the total contract value, which may not have been designed and developed indigenously.
ABOUT DEFENCE ACQUISITION COUNCIL
It was formed after the recommendations were made by Group of Ministers on Reforming the national Security system in 2001, which was setup post Kargil war.
DEFENCE ACQUISITIONS COUNCIL (DAC)
A Defence Acquisitions Council has been created as an overarching structure with the following composition:-
Chairman: Defence Minister
Members: Minister of state for defence
Chief of Defence Staff (CDS)
Chief of Army Staff (COAS)
Chief of Naval Staff (CNS)
Chief of Air Staff (CAS)
Defence Secretary
Secretary of Defence Production
Secretary Defence R and D
Director of General Acquisition
FUNCTIONS The DAC will perform the following functions:
(a) Give ‘in principle’ approval to Capital acquisitions in the Long Term Perspective Plan (LTPP) covering a 15-year time span at the beginning of a Five Year Plan period.
(b) Give ‘in principle’ acceptance of necessity to each Capital acquisition project for incorporation in the forthcoming Five Year Plan
The approval will involve the identification of Either –
- ‘Buy’ Projects (outright purchase)
- ‘Buy and Make’ projects (purchase followed by licensed production/ indigenous development)
- ‘Make’ Projects (indigenous production and R&D)
(c) Monitor the progress of major projects on a feedback from the Defence Procurement Board.
The approval in principle should be seen as first step in the process of ‘acceptance of necessity’ by the concerned Administrative Wing in Ministry of Defence.
