Tag: Acquisition

  • CDS: A Welcome Reform and the Challenges Ahead

    CDS: A Welcome Reform and the Challenges Ahead

    The Year 2020 ushered in a momentous reform for higher defence management (HDM) in India with the government implementing PM Narendra Modi’s announcement made earlier from the ramparts of the Red Fort on 15th Aug 2019, on establishing the institution of the Chief of Defence Staff (CDS). Retiring Army Chief General Bipin Rawat, not surprisingly, was appointed as the first CDS of the Indian Armed Forces. The unique honour brings with it myriad challenges lying ahead for the new appointee.

                To those at home and abroad who are accustomed to the working of governments of all political hues in India it should not be a surprise that this  critically vital appointment  took over 18 years to materialise. To recall, as part of the many HDM reforms this appointment was also approved by the NDA led Vajpayee government way back in 2001, after the 1999 Kargil War, based on the recommendations of the Subramanyam led Kargil Review Committee (KRC). Bureaucratic sluggishness, lack of will among different political dispensations as also the fact that there could be indifference on matters of even national security broadly explain the long delay. Thus, the Modi government deserves full credit for institutionalizing the long overdue appointment of the CDS. However, the designated role of CDS, the status and the government charter laying down all the details are still being worked out.

    Chief of the Defence Staff (CDS)

    As promulgated by the government, the CDS will be a ‘four star’ officer and will be considered as the ‘first among equals’ in relation to the chiefs of the Army, Navy and the Air Force. He will be the permanent Chairman of the Chiefs of Staff Committee (COSC) and can serve till 65 years of age. KRC recommended that CDS appropriately should  be a ‘five star officer’ considering his onerous responsibilities and role.

    Now that the government has given the green signal for the CDS to commence functioning to provide the desired levels of integration in all tri-service matters including policy, operational, training, communications, logistical aspects and so on, the CDS will be confronted with myriad challenges in achieving his onerous missions. Apart from an unwavering encouragement support from the Prime Minister’s Office (PMO) and the Ministry of Defence (MOD), the CDS will require more than a willing assistance from the three services to truly get-off the ground. As is natural and customary, no service likes to shed its resources and time honoured responsibilities to newer organizations. Having raised the Defence Intelligence Agency (DIA) way back in 2002, as a result of the same KRC recommendations, I am more than aware of the reluctance of the three Services to shed some of their assets and roles which will now be managed by the CDS. Thus, General Rawat will have to orchestrate extracting resources from the three Services for the new organizations, formations and units directly under his command being raised, with tact and sensitivity.

    Re-organisation of MOD: an analysis

                The MOD, till recently,functioned with four departments namely the Departments of Defence (DOD), Defence Production, Defence Research and Development as well as Ex Servicemen Welfare – each headed by a Secretary – ranked officer. On 30th Dec 2019, the government promulgated a gazette notification establishing the fifth department to be called the Department of Military Affairs (DMA) to be headed by the newly appointed CDS. The Rules of Business existing since 1961 and reallocation of certain responsibilities with the Defence Secretary have been modified though this has also invited adverse comments from defence analysts in India on the ground that the desired level of responsibilities had not been given to the CDS.

                In the last many years, right from the acceptance of the KRC and its approval by  LK Advani led Group of Ministers and subsequently by the Vajpayee government in 2001, it had been accepted by all that the CDS was urgently required as a major reform of  India’s higher defence management. The CDS was required to provide single-point professional military advice to the political leadership. However, what apparently has happened now is that the CDS will be providing his advice to the Defence Minister only and not to both the Prime Minister and Defence Minister. Many see in this, a case of bureaucratic play to reduce the importance of the CDS.

                 In the orders recently issued by the government, four key responsibilities have been taken away from the DOD under the Defence Secretary and now put under the DMA which includes the three services and their headquarters, the Territorial Army and works relating to the army, navy and the air force. Non-capital purchases and promoting jointness in procurement, operations, training, communications, logistics (including repairs and maintenance) and encouraging use of indigenous equipment and platforms will be in the CDS charter.

                Entry 1 of the amended charter for the DOD states that “Defence of India and every part thereof including defence policy and preparation for defence and all such acts as may be conducive in times of war to its prosecution and after its termination to effective demobilization” will be with the Defence Secretary.  This has apparently been done to ensure the primacy of the civil bureaucracy. Why can’t the responsibility of defence policy and the mandate for defence of India not rest with the Defence Minister if this charter, was to be kept away from the CDS?

    Why can’t the responsibility of defence policy and the mandate for defence of India not rest with the Defence Minister if this charter, was to be kept away from the CDS?

                The other amendment is in the field of defence purchases where the earlier formulation of “procurement exclusive to the defence services” has been altered to “capital acquisition exclusive to the defence services.” This means that big-ticket acquisitions will be in the Defence Secretary’s ambit creating an impression of paucity of faith in the CDS in this matter.

    The existing HQ Integrated Defence Staff could have been the backbone for this new integrated structure within the MOD brining about cost-effectiveness as well. 

                The Department of Military Affairs will have a structure that rightly includes civilian bureaucracy as well. The CDS will be assisted by two joint secretaries and a dozen deputy secretary level officers. Ideally not only the CDS but the entire MOD should have seen complete integration of the civil bureaucracy with the military. The existing HQ Integrated Defence Staff could have been the backbone for this new integrated structure within the MOD brining about cost-effectiveness as well.  Military and civil officers should be working in various departments of the MOD in unison. The Defence Secretary could have been retained, as the coordinator of all the departments. The DMA could have been headed by a Secretary level Vice Chief of the Defence Staff (VCDS) to enable the CDS, in the MOD, to concentrate primarily on critical strategic issues for advising the Prime Minister and Defence Minister on macro-management of defence strategy.

                The Defence Secretary’s charter also includes  military cantonments, veterinary and military farms, land acquisition for defence, Border Roads Organisation, purchasing food items for defence and even the Canteen Stores Department – virtually covering all issues and portfolios related to financial expenditure and management! Surprisingly, even the management of the National Defence College (NDC) and the Institute of Defence Studies has been kept with the Defence Secretary!

    The DMA could have been headed by a Secretary level Vice Chief of the Defence Staff (VCDS) to enable the CDS, in the MOD, to concentrate primarily on critical strategic issues for advising the Prime Minister and Defence Minister on macro-management of defence strategy.  

    Theatre commands

                One of the critical issues, after the establishment of the CDS system, would be the widely discussed recommendation that integrated inter-service theatre commands should be established to exercise control over all operations in each theatre as practiced in many nations of the world including US and China. Currently the three services have their own operational commands that make for a total of 17 command HQs.  In addition, the Indian Armed Forces through HQ IDS have under their control only one tri-service command headquarters, namely the Andaman and Nicobar Command (ANC). The Strategic Forces Command (SFC), though led, manned and operated primarily  by personnel from the three services have their ultimate command authority  vested in the Nuclear Command Authority directly under the PM/National Security Council.

                The CDS has been tasked with the responsibility of restructuring military commands for optimal utilization of resources by bringing in jointness in operations through the establishment of joint theatre commands. However, many Indian analysts opine that the armed forces should commence this integration after coursing out exhaustive trials initially for one command headquarters. The significant change must be analysed in its entirety and not rushed through. It may be prudent to adopt ‘best practices’ of some other formidable armed forces in the world and suitably adapt them for our own challenges and genius. Theatre commands, once finally agreed to, can be implemented in a graduated manner employing the incremental concept. In the services even with the current structures, far greater jointness in operational doctrines and plans, training, communications and logistics should be ensured first to establish synergy.

    Theatre commands, once finally agreed to, can be implemented in a graduated manner employing the incremental concept.

                The newly appointed CDS at a recently conducted press conference outlined the likely contours of the envisaged theatre commands. He stated that two integrated commands, namely the Air Defence Command and the Peninsular Command respectively will be raised in the coming year while they will endeavour to raise the first theatre command by 2022. Preliminary studies on the geographical and operational spans for five theatre commands along the northern and western borders are underway. In addition, the services are also carrying out an in-depth study to examine if Jammu and Kashmir should have a separate theatre command.

                The Air Defence Command will be integrating all air defence assets including air defence missiles with the three services, coastal guns, air defence radars and air surveillance systems presently held with the three services.  In view of potent air and ballistic missile threats from India’s adversaries, the Air Defence Command, to be headed by an air force officer, will assume critical significance in terms of its efficacy.

                The Peninsular Command which, some naval officers want to call the Indian Ocean Command will look to merging the western and eastern naval commands. This command to be headed by a naval officer would be given dedicated air force assets and army troops. It would work to ensure India’s maritime security interests in the Indian Ocean region, both on the western and eastern sea-boards, and would also acquire the capably of conducting amphibious operations.

    National Security Doctrine

     As one of his top priorities, the CDS must have the Government Issue a National Security Doctrine which lays down a well-conceived and comprehensive strategic policy for the nation in the short, mid and long term perspective. It will be primarily an articulation of the nation’s overall vision and strategic intent. This document should naturally have both the non-classified and classified objectives which can be disseminated on a ‘need to know’ basis among concerned institutions and personalities in the country. The existing HQ IDS have endeavoured in the past to produce perspective plans for the Indian Armed Forces and have the requisite expertise to produce such policy documents for approval by the government.

    HQrs Andaman and Nicobar Command and newer agencies

                As mentioned earlier, the Indian Armed Forces have under their direct ambit only one tri-service command, namely HQ ANC. This Command HQ is of critical significance for its role in dominating the sea-lanes of the Indian Ocean and preventing the ever-assertive PLA Navy from indulging in mischief in these waters.  The CDS would no doubt accord adequate attention to a further strengthening of the strategic combat capabilities of HQ ANC for handling maritime challenges that will only multiply on India’s eastern seaboard and in the entire Indo-Pacific region.

                For CDS challenges emanating from the entire spectrum of warfare encompassing all domains are a priority. The CDS will also be overseeing the establishment of the recently sanctioned Cyber and Special Forces agencies besides the Defence Space Agency. These entities in the years ahead could qualify for being upgraded to the levels of Command HQs. As widely known, the domains of cyber and space are the battlegrounds of the future – and there the foresighted Chinese have stolen a march even over hi-tech western agencies including those of the US. India, despite being an IT super power, has still a long way to go to bridge the gap between itself and China in this aspect.

    CDS: Nuclear Military Adviser   

                The CDS will now be overseeing the functioning of the SFC far more intimately than was done earlier by the COSC as he has also been designated as the Nuclear Military Adviser to the government. The presence of a senior military officer in the Nuclear Command Authority is a step in the right direction for he would be able to provide the necessary expertise and fillip to the nation’s nuclear preparedness. The CDS may wish to advise the government to review its entire Nuclear Doctrine and revisit the policies of “No-First Use” and “Massive Retaliation”. Also, it may be necessary to re-examine whether India should go in for the development of tactical nuclear weapons for limiting a nuclear exchange. India’s two adversaries, China and Pakistan, are both reckonable nuclear powers and India’s nuclear preparedness has, therefore, to match up to them.

    Defence budgets and inter service prioritization

    It is a strategic truism that the Indian Armed Forces have to be prepared to confront a “two-front war”. Mandated to provide integrated “single-point military advice” to the government, the CDS will have to rise above service loyalties and professionally prioritize conflicting inter-service requirements in the larger interests of the nation. This assumes greater significance in the current scenario where the combat capabilities of the Indian Armed Forces have to be accorded substantial accretions in an environment of great financial strain facing the nation. The volatile situation in West Asia will be greatly impacting the energy security of India and this will further tax India’s currently faltering economy. Thus, the first test for the newly appointed CDS will have to be to convince the financially stressed government to make larger allocations in the capital budget for speedy acquisition of much needed modern weapon systems. As is known, India’s depleting fighter aircraft and submarine fleets, other deficiencies in other platforms, various types of ammunition and spares, force-multipliers etc need concerted attention. Last year’s defence budget had been allocated merely 1.49 per cent of the GDP whereas successive parliamentary committees have recommended at least 3 per cent of the GDP to be assigned for defence. Unfortunately, even this year’s recently announced defence budget has been dismal – considering the big-ticket acquisitions required by the armed forces.

    In the current charter issued by the government, any big-ticket acquisitions will remain in the Defence Secretary’s purview and thus final negotiations with foreign collaborators, Indian Defence Public Sector Undertakings or Indian private industry would rest with the DOD and the Defence Secretary. Delays as earlier are likely to occur. With “Make in India” and “Start-up India” initiatives not yet taking off, the government needs to revisit these areas involving the CDS institution.

    Coordination with civil agencies

                One of the tasks that can do with better handling is improving the coordination between the armed forces and other civilian governmental agencies who are, also handling various other aspects of national security. The CDS structure now will be an important institution to improve coordination between the MHA, MOD, NSAB and NSC Real-time information or intelligence sharing between the Defence Intelligence Agency (DIA) and the other national intelligence agencies like the Intelligence Bureau, Research and Analysis Wing, National Technical Research Organisation and other newer intelligence that had come up in the last few years will hopefully improve. However, to start with, the CDS must put the Service Intelligence Directorates of the three services directly under command of the DIA for better effectiveness in the exacting intelligence domain.

    Recommendations: overall mandate for CDS

                The CDS has been formally appointed and his role enunciated and as the appointment matures in the immediate future, a further refinement of his responsibilities should be undertaken. These should include the following: –

    • The CDS should be designated as the Principal Defence Advisor to the Prime Minister (through the Defence Minister) on all matters pertaining to India’s national security.
    • The CDS should provide an overarching ‘strategic vision’ to the government and be responsible for all strategic planning for the armed forces, including all war plans and contingency planning. During peacetime, preparedness for future operations, in the strategic domain, should be one of the prime responsibilities of the CDS. He will have to synergize the mission and assets of the three services in various theatres to achieve the nation’s strategic objectives.
    • The CDS must be made responsible for overall financial planning, budgetary allocations and force structuring for the three services.
    • The CDS should oversee the preparation of the annual Defence Intelligence Estimate which obtains requisite strategic intelligence inputs for overall defence planning.
    • The establishment of theatre commands, the functioning of other tri-service commands like the Strategic Forces Command, Andaman and Nicobar Command and others which may come up in the future like the Air Defence, Cyber, Space and Special Forces Commands must get the utmost attention of the CDS.

    Conclusion

    The coming years in an increasingly troubled world and especially in our volatile neighbourhood portend diverse and formidable challenges to India’s security and economic resurgence. Consequently, an earnest effort must be made to meet them. A major HDM reform like the recent establishment of the CDS edifice goes a long way in the optimal utilization of India’s resources for defence and enhancing its operational preparedness across the entire spectrum of warfare.  All new institutions at their start do face various problems and the office of the CDS will be no exception. But it must get whole-hearted support from the PMO, MOD and the three services themselves in successfully fulfilling the onerous responsibilities and roles assigned to it.

    Views expressed are the author’s own.

    This article was published earlier in Chanakya.

  • Blockchain Technology for Indian Defence Sector : Acquisition Process

    Blockchain Technology for Indian Defence Sector : Acquisition Process

                                                         KEY POINTS

    1. Block chain technology brings in transparency, immutability and accountability which can transform the acquisition process into a very scientific, transparent and efficient system.
    2. The benefits derived from implementing blockchain technology would include elimination of subjectivity, bring in accountability, completely eliminate the role of undue influence and middlemen, and will create a level playing field for all players .
    3. Smart contracts using blockchain technology can ensure efficient compliance and enabling greater auditability and real-time identification of responsibility.

    Introduction

    Blockchain technology has become a popular term today invariably because of the benefits it provides in a P2P (peer-to-peer) network like data immutability, irreversibility, accountability and transparency. It was first used by Satoshi Nakamoto, (a pseudonym of a person or a group of people), founder of bitcoins to prevent backdating and data tampering. Blockchain is an incorruptible, decentralized, digital ledger of transactions that can be programmed to record not only exchange of information. Critically, for information to be exchanged between any two nodes within in a blockchain system, all nodes (or most nodes, depending on the structure) must agree that the exchange of information is legitimate. They do this through a variety of methods; either acting as a recognized trusted party or by solving complex cryptographic problems. Once the exchange is accepted, that exchange is written into a shared copy of a digital ledger that contacts all records of transactions that is effectively unchangeable. The benefits blockchain provides has caught the eyes of a lot of people in the world and are looking forward to implementing this technology in almost all fields like healthcare, automobile, defence, banking, agriculture and so on. Countries like China, Russia, America and South Korea are highly interested in implementing this technology in defence and other sectors. One of the key reasons being this technology optimises business processes effectively wherever it is implemented. This paper focuses on the application of blockchain technology in the Indian defence acquisition process focusing on its advantages in its implementation.

    Analysis

    Blockchain technology is a trust-less architecture. ‘Through crypto-economics, users don’t need to trust in any individual or organisation but rather in the theory that humans will behave rationally when correctly incentivised’. Blockchain in defence acquisition process would be a phenomenal game changer as it would lead to faster and quality decision-making because all the parties in the acquisition process are thoroughly informed and committed. Blockchain offers a more secure record of supply chain management and enables greater auditability and real-time identification of responsibility.  Since blockchain acts as an important tool to take major decisions, it pushes all the nodes (participants like Service Headquarters, DRDO-Defence Research and Development Organisation, HQ IDS, Acquisition Wing of MOD, Defence Finance, and so on) in the network to feed high quality and accurate information in the network. It establishes clarity in the process ensuring clarification of responsibilities to all the nodes in the network.

    The inherent security that stems from the nature of immutability and peer-to-peer characteristics of the blockchain lends itself to some critical applications within defence. Successful exploitation of blockchain is dependent on stringent data governance and quality assurance. Once the data is stored on a blockchain it is immutable, and hence, it forces participants to become quality assured with their data/information prior to storage. Quite naturally, it will bring in a culture of professional diligence, accuracy, and integrity. Blockchain works as an immutable record of transactions that do not require to rely on an external authority to validate the authenticity and integrity of the data/information.

    Smart Contracts:      If blockchain technology is taken up in defence acquisition process, smart contracts become an essential part of it. Smart contracts are a set of computer programs on the blockchain that can automatically execute activities when certain conditions are met. They can be viewed as a normal contract with terms and conditions that is converted to a digital script and stored on the blockchain. Since blockchain works on a distributed decision making model and not a central party that is powered to make all the decisions, the process might get complicated at times. To ease this, smart contracts can automate parts of the process that can overcome this complexity. For example, smart contracts can track the transfer of equipment from the vendor to buyer. Once the buyer receives the equipment as per the conditions given in the smart contract, it will automatically expedite the funds to seal the transaction. Besides, smart contracts can eliminate the problems of delayed compliance or non-compliance to contractual issues and vendors’ propensity to contest penalties, a frequent problem in Indian defence contracts. Blockchain based smart contracts are legally fool-proof and hence, compliance is the only way out.,

    Since defence acquisition process and its inner workings function on a parallel basis to save time, the process could be more optimised if blockchain is effected fully.  The whole process can come under blockchain right from generating an RFI, (where it deals with acquiring information about vendor capabilities and their product features for making better buying decisions) till post-contract management. It is also important to recognise the need to invest in creating significant data-bases that store and process volumes of confidential, operational, and industrial information.

    This information can enable creation of verified and immutable data-base on the nation’s production capacity, indigenous technological status to ultimately enabling the decision on imports vs indigenous development, governed by operational requirements of time and relevance. It will also enable the users (military) to have a better mapping of Indian technological capabilities, resulting in more sound formulation of SQRs. Essentially the RFI process should collate:

    1. Production capabilities inside the country.
    2. Technological expertise available within the country for design and development within the required time frame.
    3. Identifying the solution of acquiring technologies through JV route.
    4. Establishing products and technologies available outside the country in the context of our operational requirements.
    5. Production capabilities outside the country.
    6. Armed forces modernisation requirements for enhancing the war fighting capability.

    All of this can be made a holistic process and come under the purview of blockchain technology, which will optimise the whole procedure bringing in accountability, transparency and data immutability that has been the dire need for a long time.

    The whole acquisition process involves multiple departments and stakeholders that interact through multiple meetings, discussions, brainstorming, and final decisions arrived at. Currently all these are controlled through bureaucratic procedures and centralised control . This classical procedure has given room for any number of accusations, scams, and delayed decisions. Blockchain technology overcomes all of these problems as it is based on innovative automation using AI, complete decentralisation, and the very fact that its structure is based on trust-less architecture. Hence, any decision that is committed to is recorded for posterity, and is immutable, transparent, and irrevocable. More importantly, there will no cases of missing files, no cases of mistaken attributability, and the question of illegal modification is simply impossible. While implementation will have technical challenges, blockchain technology will make the system unquestionably transparent, accountable, and of high integrity.

    Transparency is the biggest strength of the blockchain technology, and any attempt at post event modification or tampering with records, is impossible. This tamper-proof benefit offered by blockchain ensures integrity in the acquisition process resulting in trust amongst the nodes in the network.

    Important details in the selection process can be scrutinised even more effectively, for example:

    1. Company’s financial status
    2. Product features and specifications
    3. Annual report
    4. Past contract dealings and so on

    All of this can be witnessed by all the nodes in the network and a sound and swift decision can be made.

    Private Blockchain Network: While the general or public systems can use the public blockchain, the defence sector will necessarily be using the private blockchain network. A private blockchain is a permissioned blockchain. Permissioned networks place restrictions on who is allowed to participate in the network and in what transactions. It works with revealing the identity, role and organisation of the node before adding them to the concerned network, so one can determine whether the information has to be sent to them or not. This makes the nodes accountable to their actions in the process and any signs of actions by them, which can be detrimental, are easily exposed and corrective actions can be initiated. Where parties are culpable, penal actions can be made swift and effective. This type of blockchain is present in private enterprises for swift and sound decision making and meeting compliance requirements. Private and closed blockchain can be implemented within the procurement committee, who are in charge of making decisions regarding supply chain management and acquisition of products and spares across all ranges.

    Conclusion

                   Blockchain will be a total game changer if implemented in our defence acquisition system. By using blockchain technology teams building decentralised projects can take advantage of its most valuable strength – the ability to reach a shared truth that everyone agrees on without intermediaries or a centralised authority. The chain works as an immutable digital ledger. It is not possible to modify any block without changing the entire chain, this makes it highly valuable in what is often, a highly contested and complex defence domain.

    It is also highly beneficial for defence industries for their own functioning, transparency and efficiency. Recognizing the benefits offered by it, countries like the US, China and South Korea have already initiated the process of implementing blockchain in their respective defence industries. Issues like financial mismanagement, mysterious and anonymous order approvals, inability to track orders in supply chain and so on can easily be eliminated.

    Blockchain technology is seriously being looked at or being implemented by many countries in areas of defence and security, blockchain technology in defence, blockchain for military defence, blockchain for aerospace and defence etc.

    The immutability of blockchains allows all participants involved in the network to be confident in the fact that the data written to them hasn’t been tampered with or changed in anyway and that it will be available and accessible far into the future. India’s entrenched bureaucratic structure and its political culture tends to favour archaic and over-centralised systems for vested interests. Given the nature of India’s challenges in areas of defence modernisation, failure of its control over critical technologies, inefficiencies in its defence industries (both private and public), and a high import-dependency for defence equipment, it is imperative to start with innovative technologies like the blockchain to reform its defence architectures, acquisition system in particular. Political will is necessary to initiate this transformation. With the current Government mandate, modernisation in Indian defence being one of the main objectives, initiating it from the acquisition process would be the way to go about it.

    S Swaminathan is a research analyst with TPF. He holds a masters in Defence and Strategic Studies.

    Image Credit:Photo by André François McKenzie on Unsplash