India’s defence innovation ecosystem faces a hidden but critical internal threat — procurement delays. In an industry where timelines can determine technological edge and superiority, slow decision-making is not simply an inconvenience — it drains private capital investments, national capabilities, and strategic readiness.

The ministry of defence (MoD) has introduced promising initiatives such as Buy Indian - Indigenously Designed, Developed and Manufactured (IDDM), Make-II, and iDEX — all intended to foster robust private-sector participation. But the speed of execution remains the Achilles’ heel. Without measurable improvements in how quickly approvals move from Acceptance of Necessity (AoN) to actual orders being placed and timely payments being realised, innovators, especially self-funded R&D businesses, risk being forced out of the market.

Why focus on self-funded R&D businesses? Because they have skin in the game. SpaceX rockets flew because all payments were milestone-linked until rockets actually flew, while NASA-funded projects by Lockheed Martin and Boeing languished. We need to encourage more companies to do self-funded R&D for successful development. That will happen only if the procurement cycle is compressed. This requires incentivising government officers to process the files faster — by assigning a value to every day of delay.

We estimate each day of delay on a ₹100-crore defence project translates into an estimated ₹10 lakh in real lost value. For a ₹100-crore defence project, a cumulative 24-month delay — unfortunately not uncommon — translates into losses exceeding ₹72 crore, capital that could have funded multiple new R&D programmes. This cost is borne by the innovating company ( ₹2.4 lakh/day as interest on loans, payroll, operational overheads), the armed forces ( ₹1.8 lakh/day from delayed capability deployment, using outdated technology), the larger economy ( ₹4.2 lakh/day in missed GDP impact, tax revenues, export potential), and the innovation ecosystem ( ₹1.6 lakh/day with talent migration, company shutdowns).

Meanwhile, a TERI study revealed a startling statistic: A mere 15% penetration of the Crew Gunnery Simulator could result in conservatively estimated annual savings of ₹1,123 crore for India’s armed forces. And the total capital investment required to generate such savings is just ₹61 crore.

A relatively easy solution lies in implementing SPEED (Savings and Penalties for Early or Delayed Decisions), a framework for tracking the financial and operational impact of procurement timelines. Savings will be quantified benefits of decisions made on or ahead of schedule, with clear metrics on funding freed up for R&D reinvestment. SPEED system will assign and publish daily costs of delays, with estimated losses apportioned to the company, Armed Forces, broader economy, and innovation ecosystem.

A SPEED score for every active procurement file — updated automatically in real-time — would give policymakers, industry, and the public clear visibility of performance across the procurement value chain. Currently, there are no costs to the government. By providing approximate delay costs, it alerts all decision makers to process files faster as there is quantified cost to holding them back. This SPEED score can also be criteria for assigning future projects to officers. Automatic approval after default periods may also be considered.

The ease of using SPEED lies in automation: A file moving forward means progress, minus penalties and probably savings. When files are sent back or additional questions raised, delay costs automatically accumulate at that decision point. This means no subjective interpretation, no gaming — just objective, transparent accountability for costs of inaction or unnecessary delays. For security reasons, if not made public, they should be internally tracked at least at defence ministry and armed forces levels.