DAC clears Rs 2.12 lakh crore capital buys, 82% from Indian industry
The Defence Acquisition Council, chaired by Raksha Mantri Rajnath Singh, on 26 October 2026 accorded Acceptance of Necessity to capital acquisition proposals worth about Rs 2.12 lakh crore. They cover the Army, Navy and Air Force: helicopters, air defence systems, drones and naval platforms. About 82% of the procurement will come from Indian industry, per the Ministry of Defence.
Syllabus: Prelims · Current Affairs & IR; GS3 · Indian Achievements in S&T; GS3 · Security Forces & Agencies
Why this matters for UPSC
GS3 security and defence technology, and indigenisation of technology. Prelims can ask what the Defence Acquisition Council does, what Acceptance of Necessity means and the Buy (Indian-IDDM) category; Mains, about self-reliance in defence procurement.
Why it matters
Soldiers on the border, sailors on warships and pilots in forward bases are the first to feel this: drones, short-range air defence and decoys answer the cheap aerial and missile threats of modern war. About four-fifths of the purchases are meant to come from Indian firms. So the money is expected to flow to Indian factories, small suppliers and start-ups, building jobs and skills at home. The larger issue is self-reliance in defence: a country that imports its weapons depends on foreign suppliers for spares and upgrades in a crisis. Approval is still not delivery, so speed of procurement remains the test.
Prelims pointers
- Defence Acquisition Council: constituted by a Ministry of Defence order of 11 October 2001 after the Group of Ministers' report on reforming the national security system.
- DAP 2020 added the Buy (Global – Manufacture in India) category, for foreign vendors making equipment through an Indian subsidiary, with minimum 50% indigenous content of Buy plus Make.
- First Defence Procurement Procedure: promulgated in 2002 and revised periodically since; the 2020 revision is titled the Defence Acquisition Procedure.
- DAP 2020 minimum indigenous content: Buy (Indian-IDDM) 50%; Buy (Indian) 50% with indigenous design, otherwise 60%.
- DAP 2020 reserves Buy (Indian-IDDM), Make I and Make II, among other categories, for Indian vendors with FDI not above 49%.
- Make I projects are government funded up to 70%; Make II projects are industry funded.
- DAP covers capital procurement under the Capital head; the Defence Procurement Manual 2025 covers revenue procurement for maintenance and sustenance.
- A 2023 DAP amendment requires, in all categories, at least 50% indigenous content as material, components and software made in India.
Practise a UPSC-style question
With reference to the Defence Acquisition Council (DAC) of India, consider the following statements:
1. It is chaired by the Chief of Defence Staff.
2. Its Acceptance of Necessity is an in-principle administrative approval of a capital acquisition proposal.
Which of the statements given above is/are correct?
- (a) 1 only
- (b) 2 only
- (c) Both 1 and 2
- (d) Neither 1 nor 2
Show the answer
Answer: (b) 2 only
Answer: (b) 2 only. The Defence Minister chairs the DAC, and AoN is its in-principle approval.
Statement 1: incorrect. A Ministry of Defence order of 11 October 2001 constituted the DAC under the Defence Minister as its chairman; the Raksha Mantri chaired the 26 October 2026 meeting.
Statement 2: correct. The Ministry of Defence describes Acceptance of Necessity as in-principle administrative approval; trials, bids and the contract follow.
Eliminate: Statement 2 matches the Ministry's own definition of AoN. Out: (a), (d).
Eliminate: Statement 1 names the wrong chair; the Defence Minister heads the DAC. Out: (c).
Trap: Swapped attribution. The chair is moved from the Defence Minister to the Chief of Defence Staff, a senior defence post that sounds plausible.
Remember: DAC = Defence Minister in the chair; AoN = in-principle approval, not a contract.
Explainers on this topic
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