Parrikar for new Procurement Policy to leaglise middlemen in defence deals

Defence minister Manohar Parrikar

New Delhi, Dec 31: Defence minister Manohar Parrikar has said that a new Defence Procurement Policy to legalise representatives from foreign defence firms will be introduced in another month and a half.

Speaking to a news channel, Parrikar said: “The middle men have to be declared and their commission cannot be linked to the outcome of negotiations.”

The Defence minister said the government will also allow these agents to participate in meetings to help the company they represent as it would be impossible for official representatives to attend all meetings in India.

In an interaction with journalists late Tuesday night, Parrikar also said the ministry is thinking of giving conditioned and limited approval to dealing with banned firms, and a ban has been lifted to get spare parts for Tatra trucks.

He said: “Representatives from defence firms are already allowed in the Defence Procurement Policy… the problem is it does not say what is not acceptable.”

The Defence minister further said: “Changes will be made to the DPP, representatives will be allowed but commission, or percentage of profit for the deals will not be allowed. The representative’s remuneration shall be declared by the company.”

A draft of the changed policy is ready and a final draft will be ready in another 8-10 days, he said, adding that it will then go through further procedures before going to the Union cabinet.

“The process shall be completed in another one and a half months,” said Parrikar, but noted that those agents who have been banned by the ministry will not be permitted under the new arrangement. He, however, said that banned firms can be conditionally allowed.

He said: “Based on merit and necessity, one can think of lifting the ban to a reasonable level.”

Parrikar said the state-run Bharat Earth Movers Limited (BEML) has been allowed to supplying spare parts for Tatra trucks, as long as it does not deal with the British subsidiary of the company, which was banned following irregularities in its deal with BEML.

“Limited NoC (no objection certificate) has been given to BEML because we need Tatra trucks,” Parrikar added.

It may be noted that middlemen or defence agents were banned for years after the multi-million dollar scandal in the 1980s involving alleged kickbacks paid to politicians and officials in the purchase of Bofors guns.

In 2003, a report had recommended legalizing middlemen and making negotiations transparent, but it failed to end corruption as no agent registered with the government.

(With Agency Inputs)


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