Armed forces financial powers hiked three-fold

Army finances

The Army, Navy and Air Force headquarters' financial powers have been increased from Rs 50 crore per procurement to Rs 150 crore, in an effort to accelerate sourcing of weapons and equipment urgently needed by the three forces.

The revised financial powers, under which the three services headquarters can now procure up to Rs 150 crore on their own, got the nod of the highest decision-making body, the Cabinet Committee on Security (CCS).

According to MoD, defence minister AK Antony, who is a member of CCS, informed other members of the key panel headed by Prime Minister Manmohan Singh that the Army, Navy and Air Force headquarters' financial powers were being increased from Rs 50 crore per procurement to Rs 150 crore, basically to accelerate purchase of weapons and equipment urgently needed by the respective forces.

The MoD had already given in-principle approval to the increased financial powers in May 2012 when Antony had chaired a meeting of the three services chiefs along with the Defence Secretary.

The May decision had come in the wake of criticism mounting that India's defence forces' preparedness to wage a war was very poor due to the approaching obsolescence of its weapons and equipment.

The government rules stipulated that defence minister enjoyed financial powers for procurement worth over Rs 500 crore but less than Rs 1,000 crore. However, if the procurement cost exceeded this limit, the CCS headed by the prime minister, with finance minister, external affairs minister and home minister, apart from the defence minister, as members will take a decision on the purchase.

Some of his decisions on allocation of funds in recent times had been questioned by the internal auditors of the Defence Ministry following which checks were put in place in the form of appointing a financial advisor in the DRDO chief's office.

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