L1 is the vendor whose product has successfully passed all compliance parameters and technical evaluation tests and who is also the lowest bidder among all the otherwise successful vendors. However, does the concept work towards the goals and objectives for which it has been put in place?

Determined to remove infirmities in the defence procurement procedures, the Government of India has further refined the acquisition process through its revised and recently released Defence Procurement Procedure 2008 (DPP 2008). The document has also helped to further unravel the enigmatic L-One (L1) to make the defence procurement regime truly transparent, equitable and responsive. Or, has it?

For the uninitiated, consequent to the acceptance of the report of the Group of Ministers, constituted in the wake of the 1999 Kargil Conflict, a new setup had been established in the Ministry of Defence (MoD) in October 2001 and a procurement procedure was put into effect on December 30, 2002. The procedure has, since then, been revised three times—in 2005, 2006 and, finally, this year—to remove all perceived anomalies and make it more comprehensive. India’s defence acquisition process can be broadly divided into two stages, planning and procurement, which are neither exclusive nor independent of each other. The procurement part of the process which is of immediate interest right now and which will lead to the understanding of the L1 concept consist of (sequentially): formulation of Services Qualitative Requirements (SQR), solicitation of offers, technical evaluation, field trials, staff evaluation, technical oversight, commercial evaluation and negotiations and; finally, the contract signing and project management and execution.

Once the SQRs have been approved by the Defence Acquisition Council (DAC), solicitation of offers are processed by the Acquisition Wing through issuance of Request for Proposal (RFP) to original equipment manufacturers authorised vendors and government-sponsored export agencies. The Acquisition Wing which maintains a comprehensive data bank issues the RFP to eligible vendors who are not only required to submit their technical but also commercial proposals—termed Single-Stage Two-Bid system—in two separate sealed envelopes. Initially, envelopes containing only the technical offers are opened by the concerned agency and handed over to Service HQ constituted Technical Evaluation Committee (TEC) which starts the process with the structuring of a Compliance Statement with respect to SQR. Envelopes containing the commercial offers are kept unopened in safe custody of the MoD.