Defence Minister in Manohar Parrikar has made a good beginning by clearing the acquisition of 840 artillery guns; 100 to be bought off-the-shelf and balance to be produced indigenously. This would start filling the three-decade-old critical void of the Indian Artillery. Parrikar has said that the military should be made so strong that no one should stare at us, which indicates the much needed resolve considering the dire state the equipping has been. While Prime Minister Narendra Modi has given the call of ‘Make in India, Sell Anywhere’ and foreign direct investment (FDI) in defence has been opened beyond 49 per cent on selective basis, Prime Minister Modi has also asked for simplification of defence acquisition procedures. But while Parrikar would focus on the latter, he needs to remember that while over 70 per cent of defence equipment continued to be imported, this together with the balance produced indigenously is certainly not state-of-the-art.

More alarmingly, and that 50 per cent of all military equipment held is obsolete as acknowledged by the Ministry of Industry and Commerce website. Therefore, bridging the large asymmetry visà-vis our adversaries is no more a game of numbers alone. If we continue in the same vein of acquisitions based on the lowest bidder (L1), the asymmetry will actually widen further considering the numbers that need to be filled up. There is paradigm shift in the nature of conflict.

Modern-day conflicts have expanded to include sub-nationalities, terrorists, insurgents, religious fanatics and ethnic interests. South Asia is in the centre stage of subconventional conflict and instability. The entry of non-state actors has added a new dimension to low-intensity conflicts. Responses to such challenges need to be addressed in a focused and credible manner. Our armed forces need to maintain ‘qualitative’ edge by upgrading technologies. Military transformation includes network-centricity as an essential ingredient including nanotechnology, enabling single platforms to do multiple tasks, particularly in the subconventional and irregular environment, while cyber and space are the new frontiers. The L1, or ‘Lowest Bid’, factor has ruled the roost in defence procurements in India ever since. Should we let the L1 factor continue to be the major factor for defence procurements for our military when technological advances have revolutionised warfare and technological superiority will be a major battle winning factor in future? Should we blindly submit to the British legacy of L1 bids, deluding ourselves under the pretext of being ‘cash strapped’ when the widening asymmetry has affected combat capabilities in face of mounting threats, the China-Pak nexus and the retrograde defence modernisation that we have suffered over the past decades?

The response of vendors to the RFP (request for proposal) is of two types: ‘best price’ and/or ‘best quality’. Invariably, weightage of the former is more and ‘best quality’ becomes a casualty. Many times the price being quoted by other vendor(s) get leaked out or shall we say obtained through economic espionage. The enterprising vendor then bids a much lower price to obtain the contract though the quality of his product that may be qualitatively inferior. The focus on quality is overshadowed by the lower price being offered. There have also been instances when in order to promote indigenisation the GSQR (General Staff Qualitative Requirements) by the military is forced to lower or equipment developed without reference to users is simply dumped with them even though officially this is not acknowledged.

To compound the problem the existing procurement procedure does not permit contracting through the L2 vendor should the L1 vendor fail to deliver for some reason. In case the L1 vendor fails, the procurement procedure requires the entire process of RFP to be repeated involving critical delays in procuring vital equipment for the defence services. An example is the handheld light-weight Laser Target Designators for our Special Forces, the RFP for which was floated some nine years back but this critical equipment is still not provisioned since the L1 vendor had failed to deliver in the first instance. The bottom line is that the lowest cost bidder (at its face value) at times cannot really bring in the great value for money.

Additionally, in the long run it may turn out to be far more expensive for our armed forces versus the other bidder who may be L 2 or L3. The latter two may be expensive at face value but may possibly bring better long-term cost-effective life-cycle, thereby giving much greater value for the money spent in the long run. Prudence demands not only should we review the pros and cons of the L1 factor, perhaps it needs to be replaced with the ‘Best Technology Bid’ factor. In the interim, we also need to permit automatic procurement through L2 or L3 vendor without any loss of time should the L1 vendor fail to deliver.

Additionally, we are still taking recourse to about 40 month span for Information System and Communication projects despite rapidly changing technologies. In such circumstances, our military modernisation will continue to regress. Perhaps a separate defence acquisition procedure is needed for Information Systems and Communication projects with telescoped gestation period reducing the procurement time. These issues require deliberate focus by the Defence Minister. With the support he is likely to get from the Prime Minister’s Office (PMO), he certainly can break the shackles of L1 and usher a policy of ‘Best Technology’ for defence acquisitions. This will help modernise our military to the extent that our adversaries would not dare stare at us, very much in accordance with the vision of Parrikar.