DAC accorded AONs for procurement of LCH & LCA Mk 1A and for upgradation of Su-30 MKI Aircraft

Defence Acquisition Council (DAC) accorded Acceptance of Necessity (AON) for procurement of Light Combat Helicopter (LCH) for Indian Air Force & Indian Army and Light Combat Aircraft (LCA) Mk 1A for Indian Air Force from HAL under Buy (Indian-IDDM) category. The AONs have also been accorded for upgradation of Su-30 MKI Aircraft indigenously from HAL.

The Defence Acquisition Council (DAC), under the chairmanship of Raksha Mantri Shri Rajnath Singh on November 30, 2023, accorded approval in respect of Acceptance of Necessity (AoNs) for various Capital Acquisition Proposals amounting to Rs 2.23 lakh crore, of which, acquisition worth Rs 2.20 lakh crore (98% of total AoN amount) will be sourced from domestic industries. This will give a substantial boost to the Indian Defence Industry towards the aim of achieving the goal of 'Aatmanirbharta'.

The DAC accorded AoNs for procurement of Light Combat Helicopter (LCH) for Indian Air Force (IAF) & Indian Army and Light Combat Aircraft (LCA) Mk 1A for IAF from Hindustan Aeronautics Limited (HAL) under Buy (Indian-IDDM) category. The AoNs have also been accorded by the DAC for upgradation of Su-30 MKI Aircraft indigenously from HAL. While procurement of these equipment will provide enormous strength to the IAF, acquisition from domestic defence industries will take the indigenous capability to a new height. It will also reduce dependability on foreign Original Equipment Manufacturers (OEMs) substantially.

Further to maximise indigenisation, the DAC has accorded approval for a major amendment in the Defence Acquisition Procedure (DAP) 2020. It has been decided that henceforth, in all categories of procurement cases, minimum 50% of indigenous content shall be in the form of material, components & software that are manufactured in India. For the purpose of calculation of Indigenous content, cost of Annual Maintenance Contract (AMC) / Comprehensive Maintenance Contract (CMC) / After Sale Service shall be excluded. Also, the DAC has taken decision to further encourage start-ups/MSMEs participation in the defence ecosystem. For all procurement cases with AoN cost upto Rs 300 crore, registered MSMEs and recognised start-ups will be considered for issue of Request for Proposal (RFP) without any stipulation of financial parameters, which can further be relaxed with approval of Defence Procurement Board (DPB) for AoN cost upto Rs 500 crore on case-to-case basis.

Source : Equity Bulls

Keywords

DAC Procurement Defence HindustanAeronautics HAL LCH LCA Su30MKI