Auditor berates defence PSUs for delay in supply of critical arms

The government auditor on Tuesday came down heavily on the Defence Public Sector Undertakings (DPSUs) for delaying the supply of critical weapons and equipment, hampering the much-needed modernisation plan of the Indian armed forces.

“Inordinate delay in supply of critical weapons and equipment by Defence PSUs during XI Army Plan (2007-12), hampered the modernisation and capability enhancement plan of Indian Army,” the Comptroller & Auditor General of India stated in its report – Union Defence Services Army, Ordnance Factories and Defence PSUs – that was tabled in Parliament. It said contracts worth ₹30,038 crore, which account for 63 per cent of the total value of DPSU contracts, concluded by the Ministry of Defence during XI Army Plan, were delayed.

What caused the delay “Major reasons for delay were undue time taken in development, delay in successful evaluation of pilot sample, heavy dependence of DPSU on foreign vendors, ambiguity in contractual terms,” the auditor said.

Besides impacting defence preparedness, the delay had financial implications towards loss of interest on payments made to DPSUs.

The objective of self-reliance in defence production had also not been achieved, it added. The report stated that under the Department of Defence Production in Ministry of Defence, DPSUs and Ordnance Factories (OFs) were set up in phases to achieve self-reliance, thereby reducing dependence on imports.

ALH delivery The CAG also observed that HAL did not supply a single Advanced Light Helicopter (ALH) during the XI plan. It supplied 17 such helicopters between March 2013 and June 2015, all of which were discarded by the Army due to deficiencies and technical snags.

“Failure in timely supplies was despite advance and progressive payment of ₹3,550.85 crore made to HAL between December 2007 and July 2015, which included an advance payment for the helicopters to be supplied during XII Plan,” the CAG noted.

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