In a move to boost efficiency and speed up defence procurement processes, the government has announced a significant increase in financial powers for the armed forces. This enhancement aims to facilitate quicker decision-making and smoother contract execution, with a focus on supporting procurements exceeding Rs 1.25 lakh crore through the revenue route.
Defence Minister Rajnath Singh unveiled the updated Delegation of Financial Powers for the Defence Services in New Delhi on June 4. The revised framework not only covers medical and works projects but also introduces key improvements to enhance operational efficiency at the field level.
The government has raised financial powers by up to 100%, and in some instances more than doubled them, granting field commanders greater autonomy for prompt decision-making. This move is expected to enhance the operational efficiency of field commanders, leading to expedited contract finalization and project execution.
A major highlight of the revision is the substantial increase in financial authority for indigenisation and research and development within the military ecosystem. These powers have been doubled to promote self-reliance in defence and reduce reliance on foreign original equipment manufacturers.
The updated framework also features a 100% increase in the ceiling for urgent operational requirements, coupled with enhanced special financial powers for Army, Air Force, and Naval commanders. Moreover, provisions have been added to encourage joint service procurement, enabling lead services to make purchases with higher delegated authority than before.
To further streamline procurement processes within the defence establishment, the government has introduced new competent financial authorities and decentralized procurement of goods and services. This move is aimed at enhancing the decision-making structure in line with the increased force levels and budgetary allocations.
