SOURCE – THE HINDU
GS PAPER – 2
CONTEXT – To encourage more participation of Indian industry, including Start-ups and Micro, Small & Medium Enterprises (MSMEs) in Defence Research & Development (R&D) for achieving ‘Atmanirbhar Bharat’, Raksha Mantri Shri Rajnath Singh released a new version of Defence Research and Development Organisation (DRDO) Procurement Manual 2020 (PM-2020)
- The new DRDO Procurement Manual will facilitate the indigenous Defence Industry by simplifying the processes and ensure their participation in design and development activities
- It will facilitate faster execution of R&D projects/programmes.
- Bid security declaration option for earnest money deposit,
- Increase of threshold limit for advance payment,
- Placement of order on lowest bidder 2 (L2) in case L1 backs out
- Exemption of bid security and performance security up to Rs 10 lakh,
- No negotiations for commercial off-the-shelf (COTS) items/services wherever price discovery is happening through market forces.
- Performance security for service contracts is linked to the payment cycle instead of total contract value.
- Procurement of stores from development partners, safeguarding of free issue material through insurance cover instead of bank guarantee (BG) are other facilitating measures adopted to help the industry.
- In the new PM-2020, the liquidated damage (LD) rate for development contracts has been reduced. The delivery period (DP) extension process has been simplified for faster decision making