Defence Ministry enhances armed forces' spending powers, boosts efficiency

The revised delegation of financial powers is expected to facilitate procurements worth over ₹1.25 trillion and improve operational efficiency across the armed forces

Defence Minister Rajnath Singh on Thursday approved a "revised delegation of financial powers for the defence services", enhancing the spending authority and operational efficiency of field commanders to expedite procurement and project execution.

 

The Ministry of Defence said in a statement that the revised financial powers, which also cover medical and works projects, have been enhanced by up to 100 per cent and, in some cases, more than doubled. The move is expected to strengthen the operational efficiency of field commanders and enable faster execution of contracts and projects.

 

Although the statement did not provide a break-up of the amount involved, the increase, according to sources, is from the existing limits wherever applicable.

 

 

The financial powers for defence indigenisation and research and development have been doubled to boost self-reliance and minimise dependence on foreign original equipment manufacturers.

 

"The revised delegation of financial powers will facilitate procurements of more than ₹1.25 trillion through the revenue route, as per current-year budgetary allocations," the statement said.

 

In another change, special financial powers available to Army, Navy and Air Force commanders have been enhanced through a 100 per cent increase in the total ceiling provided to meet urgent operational requirements, giving field commanders greater flexibility in addressing immediate operational requirements.

 

The revised framework also introduces provisions to promote joint procurement by the services, allowing a service to undertake acquisitions with higher delegated powers than those available under normal procurement procedures. In addition, new competent financial authorities have been introduced to decentralise the procurement of goods and services and improve decision-making.

 

The revision of financial powers -- last undertaken in 2021 -- was necessitated by the expansion in force levels, increased expenditure on operations and sustenance, and higher budgetary allocations.

 

The statement said the revised delegation, along with the new Defence Procurement Manual notified in October, would also ensure the timely availability of resources for the armed forces.