DRDO PROCUREMENT MANUAL 2020 (PM-2020)

Salient features:

• The previous Procurement Manual of DRDO was last modified in 2016. Its objective is to encourage more participation of Indian industry, including Start-ups and Micro, Small & Medium Enterprises (MSMEs) in Defence Research & Development (R&D) for achieving ‘Atmanirbhar Bharat’.
  
  
• Bid security declaration option for earnest money deposit, increase of threshold limit for advance payment, placement of order on lowest bidder 2 (L2) in case L1 backs out are some of the salient features of the new manual.
  
  
• Some more enabling measures of PM-2020 are exemption of bid security and performance security up to Rs 10 lakh, no negotiations for commercial off-the-shelf (COTS) items/services wherever price discovery is happening through market forces.
  
  
• Performance security for service contracts is linked to the payment cycle instead of total contract value.
  
  
• Procurement of stores from development partners, safeguarding of free issue material through insurance cover instead of bank guarantee (BG) are other facilitating measures adopted to help the industry.
  
  
• The liquidated damage (LD) rate for development contracts has been reduced.
  
  
• The delivery period (DP) extension process has been simplified for faster decision making.