Facing  hindrances in military modernisation the Ministry of Defence (MoD) has done away with blanket blacklisting of companies indulging in corrupt means, a practice adopted during the UPA rule that slowed the defence acquisition process.

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The clearance to the new policy, keeping in mind the need to speed up modernisation projects, coincided with the Manohar Parrikar-led Defence Acquisition Council's (DAC) go-ahead to projects worth over Rs 82,000 crore for purchase of fighter aircraft, tanks, rockets and mini drones.

The Defence Ministry cleared the new blacklisting policy on Monday keeping in mind the delays in procurement of key equipment. Sources said that the new policy will be project-specific and unscrupulous firms will be banned from dealing in the particular segment where they have indulged in any dishonest act and allowed to participate in other areas. If a firm is banned, it will be for a specific number of years.

The new policy includes heavy penalties in terms of fines. The new policy is expected to be put up on the MoD website in the next few days. "It will be a product specific ban rather than blanket blacklisting. Also, there will be an option for heavy penalties besides those in contract and even individuals can be banned," said a source in the MoD.

The new policy would also make way for pending projects like the heavyweight torpedos for the six Scorpene submarines.

Contrary to expectation, the DAC did not take a decision on the Navy's proposal to purchase 12 US2I amphibious aircraft from Japan, though the issue came up for discussion. Sources said there could be progress on this issue during Prime Minister Narendra Modi's upcoming visit to Tokyo on November 11-12.

The DAC also gave Acceptance of Necessity (AoN) to Indian Air Force's plan to purchase 83 Tejas Mark 1A aircraft at a cost of Rs 50,025 crore, Defence Ministry sources said. It also accorded AON for the purchase of 15 Light Combat Aircraft being manufactured by HAL for the Army and Air Force for a tentative cost of about Rs 2,911 crore. AoN was also given for the repeat order of 464 Russian origin T90 tanks which are being manufactured by the Ordnance Factory Board for Rs 13,448 crore, and for procurement of 598 mini UAVs at a cost of Rs 1,100 crore.