Defence Procurement Policy (DAP)
India's Defence Procurement Policy (DAP) is evolving to address challenges posed by rapidly changing defence technologies like drones, moving towards a partn...
Moving from drone purchases to drone partnerships
The article discusses India's strategic shift in defense procurement towards smaller, cheaper, and rapidly evolving drone systems, moving away from large, sophisticated platforms. It highlights the challenges of rapid obsolescence in tactical drones due to evolving enemy capabilities and advocates for a transition from transactional procurement to long-term partnerships with domestic manufacturers. This approach, involving continuous upgrades, collaborative R&D, and managed service contracts, aims to ensure the relevance of drone technology, foster the indigenous drone industry, and streamline procurement processes like the Defence Acquisition Procedure (DAP) and Defence Procurement Manual (DPM).
Syllabus mapping
Mains syllabus topics
Indian Culture Art Architecture
Modern Indian History
Indian Society Diversity
Women Population Urbanization
Globalization Indian Society
Prelims takeaways
- India's planned $2 billion drone procurement from domestic manufacturers signifies a commitment to indigenous defense production.
- Modern warfare emphasizes smaller, cheaper, and attritable drones, as seen in recent conflicts (e.g., Russia-Ukraine war).
- Tactical drones face rapid obsolescence (2-3 years) due to evolving enemy electronic warfare (EW) capabilities.
- The need for continuous R&D, upgrades, and collaborative partnerships between armed forces, industry, and academia for drone technology.
- Key procurement frameworks like the Defence Acquisition Procedure (DAP) and Defence Procurement Manual (DPM) include provisions for COTS systems, upgrades, and financial buffers.
- The article advocates for a shift from transactional procurement to long-term 'managed service contracts' for rapidly evolving defense technologies.
Elimination traps
- Confusing the technical specifications of drones with the policy and economic implications of their procurement.
- Misinterpreting the specific provisions or objectives of the Defence Acquisition Procedure (DAP) or Defence Procurement Manual (DPM).
- Overlooking the strategic shift from large, sophisticated defense platforms to smaller, attritable systems.
Static concepts
- Uncrewed Combat Aerial Vehicles (UCAVs)
- Micro/Nano drones
- First-Person-View (FPV) drones
- Electronic Warfare (EW)
- Commercial-Off-The-Shelf (COTS) systems
- Research & Development (R&D)
- Procurement frameworks/procedures
- Managed service contract
Probable question areas
Question areas
- Objectives and provisions of India's Defence Acquisition Procedure (DAP) and Defence Procurement Manual (DPM) related to indigenous manufacturing and technology upgrades.
Question areas
- Strategic implications of drone warfare and the evolving nature of defense procurement strategies.
Question areas
- Challenges in maintaining technological relevance in rapidly evolving defense sectors like drones and potential solutions.
Question areas
- Government initiatives and policies aimed at boosting the domestic defense manufacturing sector, specifically in emerging technologies like drones.
Question areas
- The concept of 'managed service contracts' in government procurement for high-tech items and its advantages.
UPSC concepts in this story
Durable syllabus ideas for revision — not article memory.
Previous year Prelims questions on overlapping themes and topics.
Consider the following statements
1. The quantity of imported edible oils is more than the domestic production of edible oils in the last five years.
2. The Government does not impose any customs duty on all the imported edible oils as a special case.
Which of the two statements given above is/are correct
Explanation
Correct answer
A. 1 only
Statement 1 is correct. Domestic production of edible oil in 2018 was around 100 Lakh Metric tons (LMT) while import was around 150 LMT. Statement 2 is incorrect. The Government of India does impose customs duties on imported edible oils. The rates of these duties may vary depending on various factors, including the type of edible oil, international market conditions, and government policies aimed at promoting domestic production or protecting domestic producers.
Indian Economy
Agriculture
Indian Polity & Governance
Agricultural Policies & Supply Chains
Public Finance & Taxation
With reference to the Government of India, consider the following information:
| Organization | Some of its Functions | It Works Under |
|--------------------|------------------------|--------------------------------|
| Directorate of Enforcement | Enforcement of the Fugitive Economic Offenders Act, 2018 | Internal Security Division-I, Ministry of Home Affairs |
| Directorate of Revenue Intelligence | Enforces the provisions of the Customs Act, 1962 | Department of Revenue, Ministry of Finance |
| Directorate General of Systems and Data Management | Carrying out big data analytics to assist tax officers for better policy and nabbing tax evaders | Department of Revenue, Ministry of Finance |
In how many of the above rows is the information correctly matched?
Explanation
Correct answer
B. Only two
The question relates to the correct mapping of key investigative and analytical bodies under the Government of India and their parent ministries or departments. ❌ Row I: Incorrect The Directorate of Enforcement does implement the Fugitive Economic Offenders Act, 2018, but it functions under the Department of Revenue, Ministry of Finance, not the Ministry of Home Affairs. ✅ Row II: Correct The Directorate of Revenue Intelligence (DRI) enforces the Customs Act, 1962 and works under the Department of Revenue, Ministry of Finance. ✅ Row III: Correct The Directorate General of Systems and Data Management aids in big data analytics for tax enforcement and operates under the Department of Revenue, Ministry of Finance.
Indian Polity & Governance
Indian Economy
Constitutional & Statutory Bodies
Public Finance & Taxation
Consider the following statements :
Statement-I : India accounts for 3.2% of global export of goods.
Statement-II :Many local companies and some foreign companies operating in India have taken advantage of India's 'Production-linked Incentive' scheme.
Which one of the following is correct in respect of the above statements?
Explanation
Correct answer
D. Statement-I is incorrect but Statement-II is correct
* Statement I is incorrect: India's share in global merchandise trade is only 1.8% and 4% in global services. India plans to increase its export share in global trade from 2.1% to 3% by 2027 and 10% by 2047. * Statement II is correct: The PLI scheme is open to both domestic and international manufacturers. Samsung as well as Indian firms such as Dixon Technologies, UTL, Neolyncs, Lava International, Optiemus Electronics and Micromax are also expanding their factories to take advantage of the PLI scheme.
Indian Economy
Current Affairs
Social Justice & Development
External Sector & Capital Flows
Public Finance & Taxation
A country’s fiscal deficit stands at ₹50,000 crores. It is receiving ₹10,000 crores through non-debt creating capital receipts. The country’s interest liabilities are ₹1,500 crores. What is the gross primary deficit?
Explanation
Correct answer
A. ₹48,500 crores
Fiscal Deficit represents the government's total borrowing requirement, while the Primary Deficit shows how much the government is borrowing excluding interest payments on past debt. ✅ Formula:
Primary Deficit = Fiscal Deficit − Interest Payments Given: * Fiscal Deficit = ₹50,000 crores
* Interest Liabilities = ₹1,500 crores
* Non-debt capital receipts are already factored into the fiscal deficit, so no need to adjust further. Calculation:
Primary Deficit = ₹50,000 − ₹1,500 = ₹48,500 crores
Indian Economy
Fiscal Policy & Public Debt
Public Finance & Taxation
Suppose the revenue expenditure is ₹80,000 crores and the revenue receipts of the Government are ₹60,000 crores. The Government budget also shows borrowings of ₹10,000 crores and interest payments of ₹6,000 crores. Which of the following statements are correct?
I. Revenue deficit is ₹20,000 crores.
II. Fiscal deficit is ₹10,000 crores.
III. Primary deficit is ₹4,000 crores.
Select the correct answer using the code given below.
Explanation
Correct answer
D. I, II and III
Revenue Deficit, Fiscal Deficit, and Primary Deficit are key indicators used to assess a government's financial health. ✅ I. Revenue Deficit = ₹20,000 crores – Correct * Definition: Revenue Deficit = Revenue Expenditure − Revenue Receipts
* Calculation: ₹80,000 crores − ₹60,000 crores = ₹20,000 crores ✅ II. Fiscal Deficit = ₹10,000 crores – Correct * Definition: Fiscal Deficit = Total Expenditure − Total Receipts (excluding borrowings)
* Alternatively, it reflects total borrowings needed to meet the gap
* Given: Borrowings = ₹10,000 crores ⇒ Fiscal Deficit = ₹10,000 crores ✅ III. Primary Deficit = ₹4,000 crores – Correct * Definition: Primary Deficit = Fiscal Deficit − Interest Payments
* Calculation: ₹10,000 crores − ₹6,000 crores = ₹4,000 crores
Indian Economy
Public Finance & Taxation
Fiscal Policy & Public Debt
If a commodity is provided free to the public by the Government, then
Explanation
Correct answer
D. the opportunity cost is transferred from the consumers of the product to the tax-paying public.
Opportunity cost: It refers to the potential benefit an individual or entity gives up when choosing one option over another. In simpler terms, it's what you miss out on by making a specific choice. Free commodity by the government: When the government provides a good or service for free, it doesn't eliminate the opportunity cost. The resources used to provide that free good could have been used for something else. Taxpayers bear the burden: The resources for "free" public goods come from somewhere, usually taxpayer money. So, the opportunity cost isn't eliminated, it's simply shifted. Taxpayers give up the potential use of those resources in exchange for a free good or service. In essence, while the individual consumer might not directly pay for the good, the cost is still there and borne by the tax-paying public.
Indian Economy
Public Finance & Taxation
Fiscal Policy & Public Debt
Consider the following statements:
Statement-I: Interest income from the deposits in Infrastructure Investment Trusts (InvITs) distributed to their investors is exempted from tax, but the dividend is taxable.
Statement-II: InvITs are recognized as borrowers under the 'Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002'.
Which one of the following is correct in respect of the above statements?
Explanation
Correct answer
D. Statement-I is incorrect but Statement-II is correct
* Statement I is Incorrect : Earlier, InvITs offered some tax benefits to investors. However, the budget in 2023 changed the taxation structure. Currently, all income distributed by InvITs, including interest income, dividend income, and rental income, is taxable in the hands of the unitholders according to their income tax slab. * Statement II is Correct : InvITs are indeed recognized as borrowers under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act). This Act allows InvITs to access various financing options and enforce security interests in case of defaults.
Indian Economy
Current Affairs
Financial Markets & Instruments
Public Finance & Taxation
Consider the following statements :
1. Tax revenue as a percent of GDP of India has steadily increased in the last decade.
2. Fiscal deficit as a percent of GDP of India has steadily increased in the last decade.
Which of the statements given above is/are correct?
Explanation
Correct answer
D. Neither 1 nor 2
Statement 1 is incorrect: Tax revenue as a percent of GDP in India has not steadily increased over the last decade. It has fluctuated — for instance, it rose during periods of strong economic growth but fell during years like 2019–20 and 2020–21 (due to slowdown and the pandemic). Hence, the trend is not steadily upward. Statement 2 is incorrect: Fiscal deficit as a percent of GDP has also not steadily increased. It narrowed from around 4.5% in 2013–14 to about 3.4% in 2018–19, then spiked during the COVID-19 years (to around 9.2% in 2020–21) and has gradually declined since. Thus, there has been no steady increase over the decade.
Indian Economy
Public Finance & Taxation
Macroeconomic Trends & Inflation
Which one of the following effects of creation of black money in India has been the main cause of worry to the Government of India?
Explanation
Correct answer
D. Loss of revenue to the State Exchequer due to tax evasion.
A. Diversion to Real Estate: While this can happen, it still involves some economic activity and might generate taxes (though potentially not on the full value of the transaction if black money is used). B. Investment in Unproductive Activities: This can hurt the economy, but the government loses tax revenue regardless of the type of investment if it's funded by black money. C. Donations to Political Parties: This is a concern, but the lost tax revenue likely outweighs the impact of such donations. D. Loss of Revenue: Black money, by definition, avoids taxes. This directly reduces the government's income, limiting its ability to fund public services, infrastructure, and social welfare programs. Tax evasion through black money creation significantly hinders the government's ability to function effectively and meet the needs of its citizens. This is why it's a major concern.
Indian Economy
Indian Polity & Governance
Public Finance & Taxation
Fiscal Policy & Public Debt
Which of the following statements with regard to recommendations of the 15th Finance Commission of India are correct?
I. It has recommended grants of ₹4,800 crores from the year 2022–23 to the year 2025–26 for incentivizing States to enhance educational outcomes.
II. 45% of the net proceeds of Union taxes are to be shared with States.
III. ₹45,000 crores are to be kept as performance-based incentive for all States for carrying out agricultural reforms.
IV. It reintroduced tax effort criteria to reward fiscal performance.
Select the correct answer using the code given below.
Explanation
Correct answer
C. I, III and IV
The 15th Finance Commission made recommendations to promote better fiscal discipline, education, and agriculture reforms, while adjusting tax devolution among states. ✅ Statement I: Correct 4,800 crores were recommended (2022–23 to 2025–26) to incentivize states for improving educational outcomes. ❌ Statement II: Incorrect The Commission recommended 41% of Union taxes to be shared with states, not 45%. ✅ Statement III: Correct It proposed a ₹45,000 crore performance-based incentive for states to implement agricultural reforms. ✅ Statement IV: Correct It reintroduced the 'tax effort' criterion, rewarding states that better mobilize revenue in relation to their GSDP.
Indian Economy
Indian Polity & Governance
Public Finance & Taxation
Federal Structure & Centre State Relations
Constitutional & Statutory Bodies
Previous year Mains questions mapped to overlapping GS syllabus topics.
Does tribal development in India centre around two axes, those of displacement and of rehabilitation? Give your opinion.
Salient features of Indian Society and Diversity
Women, population, poverty, urbanization and development
View Mains PYQ
Achieving sustainable growth with emphasis on environmental protection could come into conflict with poor people’s needs in a country like India – Comment.
Salient features of Indian Society and Diversity
Women, population, poverty, urbanization and development
View Mains PYQ
How do you account for the growing fast food industries given that there are increased health concerns in modern society? Illustrate your answer with the Indian experience.
Salient features of Indian Society and Diversity
Women, population, poverty, urbanization and development
Effects of globalization on Indian society
View Mains PYQ
Discuss the distribution and density of population in the Ganga River Basin with special reference to land, soil and water resources.
Salient features of world's physical geography
Distribution of natural resources and industrial location
Women, population, poverty, urbanization and development
View Mains PYQ
Mahatma Jotirao Phule’s writings and efforts of social reforms touched issues of almost all subaltern classes. Discuss.
Modern Indian history (mid-18th century to present)
Salient features of Indian Society and Diversity
Social empowerment, communalism, regionalism and secularism
View Mains PYQ
Do you think that globalization results in only an aggressive consumer culture? Justify your answer.
Effects of globalization on Indian society
View Mains PYQ
According to the article, India's recent strategic shift in defense procurement for drone systems primarily involves moving from:
Explanation
The article explicitly states, 'It also signals a shift from buying large, sophisticated platforms such as fighter aircraft to smaller, cheaper and more attritable systems.'
What is identified as the primary challenge in ensuring the long-term relevance of tactical drones, as per the article?
Explanation
The article states, 'Tactical drones bought today can be obsolete in as little as two to three years, as enemy capabilities and threat environments continue to evolve.' This highlights rapid obsolescence as the key challenge.
The article advocates for a shift from transactional procurement to a 'managed service contract' model for tactical drones. Which of the following is NOT a stated benefit of this new model?
Explanation
The article explicitly mentions that partnerships would 'create a framework for continuous improvements, including performance enhancements and adaptations to evolving electronic warfare threats' and foster 'closer collaboration... in a domain where technology changes rapidly and future requirements are constantly evolving,' implying ongoing R&D, not its elimination.
"India's defense procurement for tactical drones needs to shift from transactional purchases to long-term partnerships." Examine this statement in light of the challenges posed by rapidly evolving drone technology and suggest how such a shift can foster indigenous capabilities and enhance national security.
Introduce the current shift in defense strategy, explain the limitations of transactional procurement for drones, detail the benefits of a partnership model, and conclude with its impact on indigenous industry and security.
The article highlights the close link between innovation in defense drone technology and civilian drone technology. Discuss the policy and economic implications of fostering a robust indigenous drone industry in India, considering the need for continuous R&D and rapid upgrades.
Begin by acknowledging the civil-military tech link, discuss policy measures needed for R&D and upgrades, and elaborate on the economic benefits and challenges for the indigenous drone industry.