Despite the declared intention of the new government to bring about changes in the defence procurement system such as to reduce the time taken to complete the acquisition process, inclusion of the private sector to bid for tenders and end the monopoly of the defence public sector undertakings (DPSU), nothing much seems to have been done so far.

After more than one year that the musicians have been changed, the music continues to remain the same. The most favourite tune is “New deal declared”. But the fact is that the deal remains declared only!

Despite the declared intention of the new government to bring about changes in the defence procurement system such as to reduce the time taken to complete the acquisition process, inclusion of the private sector to bid for tenders and end the monopoly of the defence public sector undertakings (DPSU), nothing much seems to have been done so far.

Tenders under processing for years with the previous government, still await their turn of finalisation despite the fact that nearly a year has gone by since the new government has taken over. Some of these are:

• Scorpene class submarine: No decision taken yet on the tender for weapon systems for the Scorpene class submarines. This will undoubtedly undermine its operational capability and consequently impinge on India’s national security interests.
• Medium multi-role combat aircraft (MMRCA): Although the tender was floated in August 2007 and the Rafale from Dassault Aviation was declared as the selected aircraft, the matter continues to linger. Contract negotiations persist endlessly without any clear indication on the final destination of the contract.
• LUH helicopter tender: Several years after the tender for 197 light utility helicopters (LUH) was floated, the tender has finally been cancelled. The armed forces are left high and dry without the LUH, a platform they badly needed.

‘Make in India’ is the new slogan these days all around. However, companies that are already partnering activity with the DPSUs in projects where the Made in India content is 50 per cent or more, are rather penalised due to the lack of decision-making towards “go ahead” for a number of contracts that are awaiting final clearance by the government.

Off-set banking for up to a million euros as requested by companies offering high-end technology is still awaiting clearance.

Foreign companies are welcome to come to India to invest in technology. However the mute question is how a company can decide to invest in India with the factors below:

• To finalise a tender is required more than seven to eight years.
• There is no clear advantage for foreign companies in forming joint ventures with Indian companies both in respect of winning contracts and the time frame for their finalisation and award after being declared as the lowest bidder.
• The Indian bureaucracy has a stranglehold on all matters concerning national security as well as the requirement of the armed forces.
• India is a nation where complaint from any quarters can paralyse the defence acquisition process. Even while the affected company may try and disprove allegations, both the reputation of the company and its business interests are seriously damaged. In the process, those that help create the problem ultimately stand to benefit.
• Business oriented companies cannot afford to wait endlessly to recover the investments made in India.

Finally, the frustration of foreign companies that are completely blind with regard to the bureaucratic procedures is too steep. For years the companies involved in the tendering process have received no response to their offers against the tender or subsequent queries. Letters written to the concerned authorities are possibly consigned to the dustbin at the earliest opportunity.

Does this scenario call for radical changes in the procedure and attitude of those in charge to make India an attractive destination for foreign investments? Need to be answered.

— Name withheld on request