New Delhi, Sep 16 (PTI) The Defence Ministry on Thursday issued a standard operating procedure (SOP) that induces clarity in the steps a buyer has to take to verify bank guarantees (BGs) that are given by international banks during an acquisition process.

"This (SOP) will facilitate timely conclusion of contracts in procurement cases involving BGs from foreign banks," the ministry said in a statement.

Also Read | NBC's $10,000 Referral Contest: Refer Your Friends and Colleagues and Win Huge Rewards.

The Defence Acquisition Procedure (DAP) 2020 provides right to the buyer to seek confirmation of the foreign bank's BG from an Indian bank, where required, at the bidder's cost.

On Thursday, the SOP was issued on the steps to be followed by the buyer for seeking advice of SBI, Parliament Street Branch, New Delhi with regard to the requirement of confirmation of such BGs, the ministry mentioned.

Also Read | Keep Your Team Ahead of the Skills Curve with Maven Analytics.

"If required, the confirmation of foreign bank's BG will be through a counter-guarantee by an Indian public or private scheduled commercial bank at the bidder's cost," it added.

The DAP 2020 allows bidders to submit various types of BGs such as advance payment bank guarantee (APBG) and performance cum warranty bank guarantee (PWBG) for discharge of various contractual obligations, it said.

"These BGs can be from any Indian public or private scheduled commercial bank (as notified by Reserve Bank of India) or first class banks of international repute," it mentioned.

(The above story is verified and authored by Press Trust of India (PTI) staff. PTI, India’s premier news agency, employs more than 400 journalists and 500 stringers to cover almost every district and small town in India.. The views appearing in the above post do not reflect the opinions of LatestLY)