Raksha Mantri released DRDO Procurement Manual 2020

To encourage more participation of Indian industry, including Start-ups and Micro, Small & Medium Enterprises (MSMEs) in Defence Research & Development (R&D) for achieving ‘Atmanirbhar Bharat’, Raksha Mantri Shri Rajnath Singh released a new version of Defence Research and Development Organisation (DRDO) Procurement Manual 2020 (PM-2020).

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Key-Points

The previous Procurement Manual of DRDO was last modified in 2016. Its objective is to encourage more participation of Indian industry, including Start-ups and Micro, Small & Medium Enterprises (MSMEs) in Defence Research & Development (R&D) for achieving ‘Atmanirbhar Bharat’.

Bid security declaration option for earnest money deposit, increase of threshold limit for advance payment, placement of order on lowest bidder 2 (L2) in case L1 backs out are some of the salient features of the new manual.

Some more enabling measures of PM-2020 are exemption of bid security and performance security up to Rs 10 lakh, no negotiations for commercial off-the-shelf (COTS) items/services wherever price discovery is happening through market forces.

Performance security for service contracts is linked to the payment cycle instead of total contract value.

Procurement of stores from development partners, safeguarding of free issue material through insurance cover instead of bank guarantee (BG) are other facilitating measures adopted to help the industry.

The liquidated damage (LD) rate for development contracts has been reduced.

The delivery period (DP) extension process has been simplified for faster decision making.