Coronavirus Outbreak: Centre relaxes procurement rules for armed forces, allows purchase of supplies from outside govt e-marketplace

New Delhi: The Ministry of Defence has invoked emergency powers in the wake of the coronavirus outreak to expedite the procurement of supplies required to establish and run quarantine and isolation facilities for the Indian Armed Forces and as well other facilities requested by the civil administration across the country. The move, cleared by Union Minister of Defence Rajnath Singh, will ensure swift and smooth purchase of stores, equipment, rations, chemicals, medicines and also their speedy transportation by the armed forces. [caption id=“attachment_8240801” align=“alignleft” width=“380”] Indian para-military soldiers patrol an area in Delhi during the lockdown. AP[/caption] A Ministry of Defence note reviewed by Firstpost said that the emergency powers will provide three important exemptions in the existing procurement rules — exemption from long-drawn bidding procedure, dispensation of procurement from Government e-Marketplace (GeM) and making 100 percent advance payment to suppliers after due diligence — to procure necessary supply in the fastest possible manner. The Indian Army is already setting up facilities for troops and also extending help to local authorities upon request. The army is currently running the largest military quarantine facility at Jaisalmer in Rajasthan and also strengthening its capabilities in states like Telangana, Uttar Pradesh, Andhra Pradesh, Bihar, Maharashtra, Kerala, Tamil Nadu, Karnataka and Assam. The Ministry of Defence’s directive, approved by Singh, said that the prevailing health emergency requires immediate procurement of certain items in quantities, which may not be available with a single supplier or within the time-frame in which they are needed. The ministry also noted that certain items of equipment are currently in global short supply and are effectively in a sellers’ market, and there are also variations in specifications within the same category of item and hence price differences may sometimes also reflect differences in specifications or quality. “Being a national health emergency of unprecedented and historic scale, delays in procurement will result in loss of lives of citizens. Hence, there is a paramount public interest in ensuring that the necessary supplies are procured in the fastest manner and financial procedures have to adapt accordingly,” the directive added. As per the directive, army units too have been exempted from government financial rules which makes it mandatory for them to purchase provisions through GeM.

It has been argued that in the present situation of lockdown, vendors under GeM, even if orders are placed, may not always to able to effect deliveries of supplies on time and at desired locations, due to closure of factories and stoppage of normal transportation services.

The ministry said that the rules related to GeM purchase will not be applicable to emergent purchases, medical and other supplies related to COVID-19 operations. “Procurement may be simultaneously undertaken from more than one source if the entire quantity required is not available or is not immediately available from one source,” the Ministry of Defence said. The army formations have also been exempted from lengthy bidding procedure by relaxing the existing rules. The normal bidding procedure for procurement is a long-drawn process but in this pandemic situation, the Ministry of Defence has allowed to receive bids by email or fax instead of e-procurement portals. The army formations will verify the authenticity of the firms and bidding time will be reduced as per the emergent requirement. More importantly, the Ministry of Defence has directed that limited tender or single tender enquiry can be entertained, irrespective of the amount of the tender. This will ensure the supplies are not hit in this crisis. The Ministry also noted that due to very limited availability of suppliers for items required for COVID-19 emergency, the suppliers may ask for full advance. To meet this situation, the ministry has relaxed the existing rules and empowered the army formations to decide the quantum of advance based on the merit of the case. In case of procurement through government-owned public sector units or Indian Council of Medical Research (ICMR), 100 percent advance may be given, if the suppliers agree to deliver in a time-bound manner. In case of private vendors, the advance may be decided at the discretion of the concerned officials to meet the developing requirement. In a very significant move, the Ministry of Defence has also empowered the concerned officials to do away with bank guarantee which has been put in place as a safeguard. The Ministry of Defence, however, has cautioned that while exercising the emergency powers for purchase of supplies, due diligence and financial proprietary should be followed scrupulously by the competent financial authority.