Anil Sood asked: What are the rules regarding multiple bids for the same OEM in defence procurement?

Amit Cowshish replies: The query is not very clear, but to answer it in broad terms, three specific paragraphs in the Defence Procurement Procedure 2016 have a bearing on the issue of multiple bidding.

First, Para 52 of Chapter II provides that if the bids submitted by the Indian vendors in ‘Buy and Make (Indian)’ cases indicate collaboration with a single foreign vendor, the matter is to be discussed by the authority which had accorded the Acceptance of Necessity (AoN) and if it is concluded that there is no scope for changing the Services Qualitative Requirements and other conditions of the Request for Proposal (RFP), and that retraction and re-issuance of the RFP is not likely to increase the vendor base, the case may be progressed further with the approval of the Defence Acquisition Council.

Second, Para 53 of the same chapter provides that if the bids submitted by the foreign vendors in ‘Buy and Make’ cases, in which they were permitted to select the Indian Production Agency, indicate collaboration with a single Indian vendor, it may not be treated as a single vendor situation, as the techno commercial arrangement of collaboration for each foreign vendor may be different from that of the other vendors. This implies that such cases can also be progressed further.

Third, under the Strategic Partnership model, the list of short-listed Original Equipment Manufacturers (OEMs) is required to be annexed to the RFP, so that the short-listed Indian companies could finalise their techno-commercial offer in agreement with any of them. Para 30 of Chapter VII provides that one Indian company can engage with any or all the OEMs but can finally submit only one offer in agreement with any one of them. However, as an exception, in segments with diverse platforms such as helicopters, potential Strategic Partners may submit response in agreement with more than one OEM to have the best technology solution.

Posted on December 31, 2019

Views expressed are of the expert and do not necessarily reflect the views of the IDSA or of the Government of India.