The defence ministry has shifted administrative and revenue procurement matters of the armed services to the newly created military affairs department led by Chief of Defence Staff Bipin Rawat, but any important matter related to defence policy will be dealt by the defence secretary.
India is set to change the bank it uses to make payments for Russian arms and is likely to route the money through UCO Bank, which is also being used to carry out trade with Iran.
The rationalisation process has been initiated after consecutive budgets where projected demands of the Navy have not been met. In the current budget, for example, the Navy was allocated Rs 41,259 crore against the projected amount of Rs 64,307 crore, which officials say is not even adequate to continue annual payments for acquisition contracts already signed.
At the centre of the controversy is the Rs 45,000-cr submarine contest for the Navy—referred to as P 75I—that will see the winning Indian entity producing six submarines domestically with a foreign technology partner. The contract is being processed under the ‘strategic partnership model’.
The naval utility helicopter project, being processed under the strategic partnership model, is now set to go to the next stage, with the navy shortlisting four domestic companies that would be eligible to tie up with three shortlisted foreign vendors for a competition to manufacture 111 choppers in India.
Plans to develop the indigenous Kaveri fighter jet engine as part of the Rafale offsets deal have not taken off.
The Adani Group has entered the small arms business with the acquisition of a facility in Gwalior.
The high-powered Defence Acquisition Committee (DAC) is expected to look into the matter this month and decide on a way ahead for the critical purchase of self-propelled air defence gun missile system (SPAD-GMS), people aware of the development said.
The tax department’s submission in the court had come in response to a writ petition filed by one of the trusts, Jamsetji Tata Trust, which had challenged the department’s move to cancel the registrations, claiming that they had themselves surrendered the registrations in 2015.
A sizeable amount of money has gone into creating these enterprises; this has to be measured. The moment it is brought to book, the PSUs will need to provide the extra cost (while bidding),” said Patil, who is also a Larsen and Toubro board member.
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