NEW DELHI: Defence Minister Rajnath Singh on Wednesday stressed that the rule of competitive bidding through open tender must be followed in defence procurement. “In the case of procurement of defence platforms/equipment, either under capital or revenue route, the gold standard of open tender should be adopted to the extent possible. A competitive bid based procurement process, which is open to all, is the best possible way to realise the full value of the public money being spent,” the union minister said.
There would be some cases when it may not be possible to go for an open tender process. Such instances should come under exceptions, he added. Singh was delivering the inaugural lecture at the three-day International Conference on Defence Finance and Economics in New Delhi on Wednesday. He asserted that a legal and procedural defence-finance framework is an integral part of a mature state system, which ensures prudent management of the defence expenditure.
The defence minister underscored the importance of comprehensive Blue Books, codifying the rules and procedures of procurement of defence equipment and systems for a fair and transparent system.
With this vision, the Government has formulated Blue Books in the form of Defence Acquisition Procedure 2020 for capital acquisition; Defence Procurement Manual for Revenue Procurement and Delegation of Financial Powers to Defence Services, he said.
“These manuals play a very important role in ensuring that the process of defence procurement is rule-bound and follows the principles of financial propriety. Since these manuals are critical, they need to be carefully crafted by defence finance and procurement experts in consultation with all the stakeholders. This needs to be a continuous exercise, so that these documents are dynamically updated, incorporating new rules and procedures as and when required,” he said.
The Minister emphasised on the role of expert financial advice to the Service personnel in day-to-day financial matters. “The system of Integrated Financial Advisor (IFA) has been created to provide financial advice to the Competent Financial Authority (CFA) in order to help them in avoiding the wastage of public money. In this system, the IFA and CFA work as a team towards utilising public money in a prudent manner,” he said.
Singh batted for a fool-proof system of internal and external audit which would tackle the instances of wastages, pilferage and corruption, if any, even after following the principles of financial prudence
and propriety .
The defence minister also put forth the idea of shared security. “In the spirit of collective security of the whole world as one family, we are all partners in the path towards a secure and prosperous future for the entire humankind. We have a lot to learn from your experiences in the field of defence finance and economics and we are ready to share our learning with you,” he said.