NEW DELHI: The Defence Acquisition Council (DAC) on Friday extended the Emergency Procurement (EP) mechanism, aimed at strengthening operational preparedness.
Sources confirmed that “The scheduled DAC meeting on Friday took up the sole case of Emergency Procurement (EP) and was postponed to be held soon, and will be taking up important procurement projects.”
The EP provision was introduced following the May 2020 standoff with the Chinese PLA. It empowers authorities in cases of urgent or operationally immediate military necessity linked to preparedness for contingencies such as war or war-like situations, natural calamities and similar emergencies.
The core objective of delegating these powers is to fast-track the procurement or repair of equipment, items, materials, and stores, as well as the provisioning of urgently required services for the successful conduct of operations.
The Competent Financial Authority (CFA) for Emergency Procurement (Capital) up to Rs 300 crore rests with the Vice Chiefs of Staff of the three services — the Army, Navy and Air Force.
The defence budget allocated by the government for 2025–26 has been pegged at Rs 6,81,210.27 crore, of which Rs 1,80,000 crore is earmarked for capital acquisition. The government’s financial year runs from April 1 to March 31 and is used for annual financial planning and budgeting.
Budgetary allocations are broadly divided under capital and revenue heads. However sources said, emergency procurement is time bound, as a project once approved has to be signed within six months of its approval and the supply has to be completed in an year from the signing date. There are certain important cases, told the sources, which are not yet completed
Capital outlay is intended for the acquisition of new systems and equipment, as well as the creation of military infrastructure. Allocations to the armed forces under revenue expenditure (excluding salaries) are intended to meet sustenance needs and operational commitments.
The Defence Acquisition Council which is usually chaired by the Defence Minister, is the highest decision-making body for defence policy and capital procurement, and its approval of an Acceptance of Necessity (AoN) marks the first step in the acquisition process.