Defence Expenditure Review Committee (DERC) Panel Proposals

A high-level committee, the Defence Expenditure Review Committee (DERC), looking into defence expenditure has recommended a host of sweeping reforms, including a hike in the foreign direct investment (FDI) limit in the defence sector to 49%, and divestment of defence public sector units (PSUs).

The DERC has made far reaching recommendations in our Acquisition System, such as:

The Govt should encourage the private sector to take over foreign defence firms.Consider setting up a sovereign wealth fund to assist this activity.

A five-fold increase in the financial powers of the defence minister -- up to Rs 500 Crores.

For accountability, transparency and efficiency, time-bound disinvestment plans should be worked out for each PSU.

Across the board increase in FDI limit to 49% with the provision for a case by case enhancement to 74%-100%.

Extensive use of ICT in the defence procurement processes.

Compress the time between RFI and actual procurement.

Read the full Report: DERC Panel Proposals

Brigadier (Retired) Sukhwindar Singh
http://www.defenceoffsetsindia.com/

Merry Christmas and A Very Happy 2010!

Sukhis

Towards Better Living: Resolve 2010

How to Stay Positive,Youthful & Happy?

• Throw out non-essentials. This includes anything that is not essential for You to live life well.

• Keep only cheerful friends. The grouches pull you down.

• Keep learning. Learn more about the computer, crafts, gardening, whatever, even ham radio. Never let the brain idle. 'An idle mind is the devil's workshop.' And the devil's name is Alzheimer's.

• Enjoy the simple things.

• Laugh often, long and loud. Laugh until you gasp for breath.

• The tears happen. Endure, grieve, and move on. The only person, who is with us our entire life, is ourselves. Be ALIVE while you are alive.

• Surround yourself with what you love , whether it's family, pets, keepsakes, music, plants, hobbies, whatever. Your home is your refuge.

• Cherish your health. If it is good, preserve it. If it is unstable, improve it. If it is beyond what you can improve, get help.

• Don't take guilt trips. Take a trip to the mall, even to the next county; to a foreign country but NOT to where the guilt is. What are guilt trips? Guilt trips are about violating boundaries. It is a way of manipulating people to get a desired outcome through indirect and passive-aggressive tactics.

• Tell the people you love that you love them, at every opportunity.

And Remember

Life is not measured by the number of breaths we take, but by the moments that take our breath away.

Your Well Wisher

Foreign A & D Majors Insist on Higher FDI Limit

FDI cap in Defence Sector is perceived lower by potential suitors. The upper limit prescribed for foreign companies to invest in JVs is 26 per cent. Echoing the view of industry bodies and foreign companies, the pre-budget economic survey this year suggested that FDI limit in defence industries be raised to 49 per cent from 26 per cent, and even allowed up to 100 per cent on a case-to-case basis, in high technology, strategic defence goods, services and systems that can help eliminate import dependence.

All this needs deliberations in wider national security interests, and NOT purely a business proposition.

Indian Defence Industry is very keen to forge JVs with foreign partners. For example, BEL is keen to forge JVs in the areas such as missiles, electro-optics and "portions of radars like radars for civilian areas". BEL is ready to work with potential partners either through a JV or some sort of arrangement like long-term partnership (not called a JV).

Click to read the full Report: Foreign A & D Majors Insist on Higher FDI Limit

Comments: MOD could always consider higher % of FDI limit on case-to-case basis for technologies extremely essential for India in next 4-5 years of time frame, with some 'special rider' on the JV company ownership and management.

Brigadier(Retired) Sukhwindar Singh
http://www.svipja.com/
(A Global Solution for Offsets)
Credit: USIBC News & Its Agencies.

Comn Inter-operability and Security Memorandum of Agreement (CISMOA)

India is in no hurry to sign Communication Inter-operability and Security Memorandum of Agreement (CISMOA) with the USA, a defence pact which provides for installation of American Comn Systems on US-made mil aircraft with certain guarantees.

The US has been wanting India to sign the CISMOA as it intends to enhance the inter-operability of the Indian and American forces. It also ensures secrecy of its C4ISR (command, control, communications, computer, intelligence, surveillance and reconnaissance) systems.

C4ISR Definition of the US: C4ISR encompasses systems, procedures, and techniques used to collect and disseminate information. It includes intelligence collection and dissemination networks, command and control networks, and systems that provide the common operational/ tactical picture. It also includes information assurance products and services, as well as communications standards that support the secure exchange of information by C4ISR systems. Under the C4ISR umbrella, systems exchange digital, voice, and video data to appropriate levels of command. This section focuses on C4ISR systems that process and protect classified information for military operations or homeland security purposes. The two key classified aspects of C4ISR systems are access to secure networks controlled by Information Security (INFOSEC) products and services and the classified data resident in the C4ISR networks.

Signing CISMOA in C4ISR environment has wider implications. India needs to evaluate its fall-out deliberately.

Brigadier(Retired) Sukhwindar Singh
http://www.svipja.com/
(A Global Solution for Offsets)
Credit: USIBC News & Its Agencies.

Defence Acquisitions, Time Overruns, Costs and Military Preparedness

The basic is that a nation undertakes burden of defence acquisitions to maintain edge of its military. Within this overall objective our procedures must flow however multi-faceted or complex these may be. Our 'thinking executives' which includes our bureaucracy , military and process experts must keep this in view in all their activities.

Shifting causes of delay / failures within any complex acquisition chain is inevitable and may even be 'past time' of some. The bottom line is, Is nation's military getting it wherewithal in time? If not, we need to worry. As is often said 'radical problems need radical solutions'. Lip service or minor changes to existing procedures and practices will not suffice. Let there be an overhaul of the Process.

An Article by Mr Harinder Singh, IDSA, and recent Seminar by the IDSA on Defence Acquisitions is timely. Click to read the full Article:

Defence Acquisitions, Time Overruns, Costs and Military Preparedness

Brigadier(Retired) Sukhwindar Singh
http://www.svipja.com/
(A Global Solution for Offsets)
Credit: Institute for Defence Studies & Analyses, http://www.idsa.in/