New Delhi, Sep 15 (KNN) In a major policy shift aimed at boosting self-reliance and accelerating defence modernisation, Defence Minister Rajnath Singh has approved the Defence Procurement Manual (DPM) 2025, the Ministry of Defence announced on Sunday.

The revised manual, issued more than a decade after its previous version in 2009, is intended to streamline and rationalise revenue procurement across the Armed Forces.

With procurement under the Revenue Head (Operations and Sustenance Segment) projected at Rs 1 lakh crore for FY 2025-26, the new framework opens significant opportunities for India’s private sector and startups.

Calling the reform a landmark step to drive innovation and reduce import dependency, the Ministry said DPM 2025 lowers entry barriers for private firms, MSMEs and startups, while integrating updated public procurement norms to improve transparency and ease of doing business.
Key reforms include the introduction of flexible development contracts that waive liquidated damages during prototype stages and limit penalties after development to 5 percent, rising to 10 percent only in cases of exceptional delays.

Companies are also assured guaranteed orders for up to five years, supported by technical handholding from the Armed Forces.

Decentralised financial powers have been granted to field-level authorities to enable quicker decisions on procurement and delivery extensions, while the removal of PSU NOC requirements creates a more level playing field for private industry.

Additionally, collaboration with academic institutions such as IITs and IISc is being promoted to drive innovation in defence systems.