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Defence Production Board yet to take call on Rs 60,000-crore combat vehicle project

The Defence Production Board, which met on February 27, is yet to take a decision on the much-delayed Rs 60,000-crore Future Infantry Combat Vehicle (FICV) project which is aimed at replacing an ageing Soviet-era fleet, top ministry sources said.

The board deliberated on the project following the submission of a report earlier last month by a panel of Independent Expert Monitors appointed by the ministry. However, it did not take a decision on proceeding with the FICV project.

“The meeting concluded that the project will have to be studied in more detail and it will be deliberated upon in the next meeting,” sources said. “Nothing has been solved yet and everything is still in the pipeline.” A top ministry source added too much time has already been spent on the project. “A few more months will have to be spent on it,” the source said.

Five private entities, including L&T, Mahindra, Reliance Defence and units of the Tata Group, bid for the contract to make 2,610 FICVs to replace the Russian BMP-2 Infantry Fighting Vehicle, which entered service in 1981. The project has faced hurdles ever since it was approved in October 2009.

The first expression of interest issued in May 2010 was retracted in December 2012 after inconsistencies in the evaluation of the responses received, said sources.

The second EOI was issued in July 2015 to 10 vendors. In January 2016, the ministry approved a proposal that state-owned Ordnance Factory Board and two private companies would make the prototype of FICV.

In February 2016, the ministry received responses to the EOI from L&T, Mahindra, Reliance Defence and Ordnance Factory Board along with joint bids by Tata Motors-Bharat Forge and Tata Power SEDTitagarh Wagons. The ministry’s acquisition wing recommended that the project either start afresh or the five private entities be selected to submit the detailed project report, explained sources.

The recommendation was in contrast to the Defence Procurement Procedure of 2008, which states that the Defence Production Board should select the two best bidders to design and develop the prototype, prepare the DPR and then make the model. Following this delay, the ministry overruled the acquisition wing’s recommendations and instructed the Defence Production Board to approve the bidders.

The panel of Independent Expert Monitors found the evaluation process for selecting the bidders to make the prototypes was correct and recommended that the project should move forward, ET reported on February 26.

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