At DAC Meet: MoD’s Nod To Defence Acquisition Proposals For Over Rs 31,000 crore

Anupama Airy


Contracts for major acquisition schemes for the Indian Armed Forces are expected to be signed in the next few months, with the defence ministry giving its approval to over Rs 31,000 crore of capital acquisition schemes for the defence sector.

The progress of a host of major capital acquisition proposals for the current financial year (2016-17) was reviewed by the apex body of the ministry of defence –the Defence Acquisition Council (DAC) that met on August 18.

The DAC is headed by the Defence Minister and comprises officials from tri-services and officials from defence ministry. DAC is also the top body which gives nod for acquisitions and other modernization approvals.

Sources in the know said that the DAC was informed that since May 2016, as many as 10 acquisition schemes worth about Rs 16,000 crore have been approved by the government including six at the level of the Cabinet Committee on Securities (CCS).

“In addition, four major acquisitions worth Rs 15,000 crore have been cleared by the defence ministry and have been forwarded for the consideration of the CCS,” they added. Put together, it was informed that over Rs 31,000 crore worth of major acquisitions have either been contracted or are at an advanced stage.

While details of all these multi-crore acquisitions were not immediately known, sources said they could include the ultralight artillery guns, Pinaka, Tracked SP Gun, Dhanush Guns (all Artillery programs of the Indian Army). The Akash Air Defence systems for the Indian Air Force could also be part of the approval process.

It may be noted here that all proposals over Rs 1000 crore go for approval to the Cabinet Committee on Security as only after the latter’s approval that a contract can be signed.

The DAC at its meeting has also requested the services and ministry of defence to expedite process for these acquisitions. Contracts for all of these acquisition schemes are likely to be inked before the first half of the fiscal is over or by end of September 2016.

Sources revealed that the DAC further noted that as against 329 AONs worth over Rs 5 lakh crore in pipeline in April 2014, there are about 234 AONs in pipeline as of now.

The DAC also considered and proved acquisition of one C-130 (replacement) aircraft and procurement of night vision goggles for pilots for night enablement

The NDA government under Prime Minister Narendra Modi has prioritised defence equipment manufacturing in India under the “Make in India” programme in order to reduce India’s huge dependence on imports of military hardware.

It may be noted that The government procured defence equipment in excess of Rs 76,000 crore for the Indian Armed Forces during 2015-16, which was around Rs 2,000 cr less than 2014-15. This procurement of weapon systems and equipments has been from both foreign and Indian vendors.



Total Procurement Procurement from Foreign Vendors Procurement from Indian Vendors
2014-15 77986.32 29159.69 48826.63
2015-16 76169.57 26190.46 49979.11

Table: Individual details of the total procurements of defence equipment from Indian Vendors and Foreign Vendors for the Armed Forces in the last two years (all figures are in Rs crore)

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