Article Posted on : - Feb 09, 2015

NEW DELHI (PTI): Promising a "paradigm shift" in defence procurement policy soon, a top official has said the government is making efforts towards facilitating the private sector, but made it clear it is a two-way street.

Noting that public sector plays a dominant role in the domestic defence sector, G Mohan Kumar, Secretary (Defence Production), Ministry of Defence, on Friday said the government is taking the challenge of enabling the private sector to play a greater role in defence production.

"In the years to come, this role has to be even or even tilted towards private sector because the role of public sector in defence sector is diminishing in all countries," he said, addressing a seminar organised by the FICCI here.

Kumar observed that the defence industry in all advanced countries, except Russia, is led by the private sector and there was reason why India should not be on similar lines.

Stressing that the defence industry cannot move forward unless the government facilitates the process, he made it clear that effort has to come from private sector also.

"It is not all government and no private sector. The government has to pave the way and the private sector has to take the way," he said.

On the state-run ordinance factories, he said the Ministry has been "hammering" them to make long-term relationship with industries so that they can outsource their products.

"We normally go by the short-term tender route of procuring things where L1 (lowest bidder) is very important.

How do we get out of that? We need to develop long-term relationships and that calls for change of procedures, change of tending process. That is a paradigm shift. We are trying to do that," he said.

He said if the government succeeds, it will definitely bring lot of changes in the way ordinance factories procure things.

"It is also true for all public sector undertakings," he said.