Defence Acquisition Procedure (DAP) 2020

The Defence Acquisition Procedure, or DAP, is the Ministry of Defence's rulebook for buying weapons, aircraft, ships and other big equipment for the Army, Navy, Air Force and Coast Guard. It tells officials how to decide what to buy, whom to buy it from, how to test it and how to sign the contract. DAP 2020 is the version currently in use. Its main aim is to buy more from Indian industry and less from abroad.

Why does such a rulebook exist?

Defence deals are huge, often worth thousands of crores. Without clear rules, deals can get delayed for years, face charges of unfairness or corruption, or leave the forces with the wrong equipment. A common procedure makes the process fair, open and trackable. It also lets the government use its buying power to grow Indian industry, because every rupee spent inside India builds local factories, skills and jobs.

This push shows in the numbers: India's defence production reached a record ₹1,50,590 crore in 2024-25, about 90% more than ₹79,071 crore in 2019-20.

Where did it come from?

After the Kargil War (1999), a Group of Ministers reviewed India's national security system. On its advice, the Defence Acquisition Council (DAC) was set up in 2001, chaired by the Defence Minister (Raksha Mantri). The first formal Defence Procurement Procedure (DPP) came in 2002 and was revised several times (2005, 2006, 2008, 2011, 2013, 2016).

In May 2017, a Strategic Partnership (SP) Model was added as Chapter VII of DPP 2016. It lets selected Indian private companies partner with foreign makers to build fighter aircraft, helicopters, submarines and armoured vehicles in India. On 28 September 2020, the Defence Minister unveiled DAP 2020, applicable from 1 October 2020. The name changed from "Procurement" to "Acquisition" to cover more than just buying, such as leasing. It was shaped to support the Atmanirbhar Bharat (self-reliant India) mission announced in May 2020.

How does a purchase happen?

In simple steps:

1. The armed force states what it needs, in writing, as Services Qualitative Requirements (SQRs).
2. The DAC grants Acceptance of Necessity (AoN). This means the government accepts that the item is needed. The DAC also decides the buying category. An AoN is only the first step; it does not guarantee a final order.
3. The Ministry sends out a Request for Proposal (RFP) to vendors.
4. Bids are checked on technical grounds, and shortlisted equipment goes through field trials in real conditions.
5. A Commercial Negotiation Committee negotiates the price with the lowest-cost qualifying bidder.
6. The Competent Financial Authority approves the deal. The biggest deals go to the Cabinet Committee on Security (CCS).
7. The contract is signed.

The buying categories (in order of preference)

DAP 2020 lists categories so that Indian options are tried first. Each has a minimum indigenous content (IC), which is the share of value made in India:

• Buy (Indian-IDDM): equipment Indigenously Designed, Developed and Manufactured, with at least 50% IC. This is the top priority.
• Buy (Indian): bought from an Indian vendor, with at least 50% IC if designed in India, or 60% otherwise.
• Buy and Make (Indian): an Indian vendor buys initial units and then makes the rest in India with technology transfer; at least 50% IC in the Make portion.
• Buy and Make: initial units bought from a foreign vendor, followed by licensed production in India.
• Buy (Global-Manufacture in India): a new category in DAP 2020. A foreign vendor supplies the item and manufactures it (or its parts) in India, with at least 50% IC.
• Buy (Global): outright purchase from a foreign or Indian vendor, with no IC requirement in DAP 2020.

DAP 2020 raised IC levels in most categories to 50%, up from 40% earlier, which itself had risen from 30% in older procedures.

Other key features of DAP 2020

• Leasing: a new option to lease equipment (Lease Indian and Lease Global) instead of buying outright, saving money upfront.
• Offsets: an offset clause makes a foreign seller invest part of the deal value back in India. DAP 2020 removed offsets for government-to-government deals, inter-governmental agreements and deals with a single vendor from the start.
• Make category: supports Indian firms to design and build prototypes. In Make-I, the government funds most of the prototype cost. In Make-II, industry funds it. Make-III covers items that are not designed in India but can be made in India to cut imports. The iDEX (Innovations for Defence Excellence) scheme brings startups into this pipeline.
• Positive indigenisation lists: lists of items the forces will buy only from Indian industry, with the first list of 101 items notified on 21 August 2020. There are two kinds. The Department of Military Affairs has issued five lists of 509 big items, such as weapons, sensors and ammunition. The Department of Defence Production issues lists of parts and spares for the Defence Public Sector Undertakings (DPSUs), the government-owned defence companies: 5,012 items in the first five lists, and a sixth list of 405 items on 18 August 2026. As of June 2026, more than 15,700 items had been indigenised, which means they are now made in India instead of imported.
• FDI link: in September 2020, the government raised foreign direct investment in defence manufacturing under the automatic route (no prior approval needed) from 49% to 74%.

What is changing next?

On 10 February 2026, the Ministry released a draft DAP 2026 for public comment. It proposes cutting buying categories from five to four, raising IC under Buy (Indian-IDDM) to at least 60%, requiring 30% IC even in Buy (Global), adding faster routes and tying purchases to how mature a technology is. As of October 2026, DAP 2026 has not been finalised, so DAP 2020 still governs purchases.

Commonly confused concepts

• DAP vs DPP: DPP (Defence Procurement Procedure) was the name up to 2016. DAP (Defence Acquisition Procedure) is the name from 2020 onward.
• DAC vs CCS: The DAC, chaired by the Defence Minister, grants AoN and decides categories. The CCS, chaired by the Prime Minister, gives final approval for the largest deals.
• Buy (Indian-IDDM) vs Buy (Indian): IDDM requires Indian design and development as well as Indian manufacture. Buy (Indian) only requires an Indian vendor with enough IC.
• Buy (Global-Manufacture in India) vs Buy (Global): The first requires making part of the equipment in India with 50% IC. The second is a straight import with no IC requirement under DAP 2020.
• Offsets vs indigenous content: Offsets make a foreign seller invest back into India's defence sector. IC is the share of the product itself that is made in India.
• Strategic Partnership model vs Make category: The SP model picks Indian private firms to build big platforms with a foreign partner. The Make category funds Indian design and prototype development.

Issues, criticism and the way forward

• Long timelines: Deals often take many years from AoN to contract, and old equipment stays in service too long. Critics say the trial and evaluation stages need to move faster.
• Measuring indigenous content: It is hard to check how much value is truly Indian. Some firms may only assemble imported kits.
• Lowest-price (L1) system: Choosing the lowest qualifying bid can sometimes favour cost over quality or long-term value.
• Private sector concerns: Private firms say they need assured orders and a fair chance against public sector units to invest in costly design work.
• Way forward: Finalise the reforms in DAP 2026, set firm timelines, strengthen testing facilities, use independent audits of IC, and give Indian industry long-term order visibility.

Concepts to Know

• Acceptance of Necessity (AoN): The DAC's formal approval that the armed forces need a certain item. It starts the buying process but does not guarantee a purchase.
• Indigenous content (IC): The share of the value of an item that is made in India.
• Offset clause: A condition that a foreign seller must invest a part of the deal value in India, for example by buying Indian parts or setting up facilities.
• Technology transfer: When a foreign maker shares designs and know-how so that an Indian company can manufacture the product.
• Automatic route: A route for foreign investment that does not need prior government approval.
• Atmanirbhar Bharat: The self-reliant India mission announced in May 2020, aimed at making more goods, including defence equipment, in India.