Service Chiefs Given Greater Financial Power in Defence Procurement
The Ministry of Defence has expanded financial powers to service chiefs and field commanders to enhance procurement efficiency. Service chiefs can now approve projects up to Rs 150 crore, while field commanders have been given approval limits of Rs 100 crore.
Highlights
- •Service chiefs empowered to clear projects worth up to Rs 150 crore
- •Field commanders can now sanction proposals for up to Rs 100 crore
- •Revamped framework supports local manufacturing and R&D
- •New provisions promote joint service procurement
Delhi: In a significant move by the Ministry of Defence, service chiefs and field commanders have been granted increased financial autonomy to facilitate smoother procurement and project execution. Under this new framework, procurement worth over Rs 1.25 lakh crore can proceed through the revenue route as per current budget allocations.
New Financial Delegation Benefits
Service chiefs are now authorized to approve projects or procurements up to Rs 150 crore, a substantial increase from their earlier authority of Rs 75 crore. Field commanders have been given the power to clear proposals of up to Rs 100 crore, compared to Rs 30 crore previously.
Minister Rajnath Singh highlighted that this is a major initiative aimed at empowering field commanders for quicker decision-making, boosting operational readiness. The new delegation will support local manufacturing and encourage the participation of private players such as MSMEs and start-ups.
Rajnath Singh stated on social media platform X, "This move will expedite decisions, enhancing the operational preparedness of our forces." He noted that these revised financial powers for works projects have been doubled to ensure faster execution and timely completion. Financial autonomy has also been increased for indigenization and R&D within the military ecosystem.
Key Features of the New Framework
- New provisions promote joint service procurement through a lead service, encouraging collaborative efforts among various branches of the armed forces.
- The creation of additional competent financial authorities will decentralize the procurement process to streamline goods and services transactions.
- Financial support for indigenization and R&D within the military has been doubled, reducing reliance on foreign original equipment manufacturers (OEMs).
Ministry officials stated that this revision was necessitated by expanding force levels and increased expenditure on operations and maintenance. The new delegation framework will align with an updated Defence Procurement Manual notified in October 2025, expediting decision-making and ensuring timely availability of resources for the armed forces.
