NEWS
Interacting with reporters at the Institute of Defence Studies and Analyses (IDSA) awards ceremony early November 2012, Defence Minister A.K. Antony said that India had sought details from the UK in connection with corruption allegations in the VVIP helicopter deal with Italy, and “strong action” would be taken in case any foul play is detected in the procurement process. Antony said the government was making “serious and sincere” efforts to find out the truth in the allegations levelled in a section of the media. “We have already written to the Italian Government through the Ministry of External Affairs about the matter to get the details whether any middlemen or Indian entities are involved as this is not permitted in our laws,” he said.

VIEWS
Allegations of impropriety in the processing of tenders as also the involvement of middlemen, payment of commission and kickbacks appear to have become fairly routine in the recent past in India, especially in high value deals pertaining to procurement of defence hardware from foreign sources. In 2010, after two years of negotiations, the Indian Air Force (IAF) concluded a $827 million ( Rs. 4,135 crore) contract with AgustaWestland through an open tender for the supply of 12 AW101 three-engine utility helicopters for Air Headquarters Communication Squadron for the transportation of VVIPs such as the President and the Prime Minister of India as also other local and foreign dignitaries.

The Anglo-Italian company AgustaWestland formed after merger of the Italian Agusta with the erstwhile British Westland Helicopters in the year 2000 is a part of Finmeccanica. Since its inception, the company has delivered over 300 helicopters of different types to 22 countries. The first machine ordered by the IAF is scheduled to arrive in India by the end of 2012 and delivery of all the 12 helicopters is to be completed in 2013. However, just when the IAF was looking forward to inducting the machine, the project appears to have encountered a possible stumbling block.

For some years now, for conveyance of VVIPs, the IAF has been using the Mi-8 and Mi-17 helicopters appropriately reconfigured. However, these machines of Soviet vintage have been overtaken by obsolescence and aggravated by inadequate product support, have become increasingly difficult to maintain. In view of the implications for safety of VVIPs, the need to replace the ageing fleet of helicopters with the latest machines had become extremely urgent. Besides, there is a requirement for helicopters ferrying VVIPs to have the best of communication equipment and advanced electronic self-protection devices to secure the platform against missiles launched by terrorists. In view of the urgency, procurement of the AW101 has been processed on fast track; but the speed with which the deal was finalised though somewhat unusual, ought not to be surprising. Meanwhile, pilots selected to operate the fleet have begun training on the AW101 in the UK.

Party or parties losing the contract along with a proactive media invariably play a major role in derailing defence deals. In this case too, as expected, the contender who was edged out, questioned the basis of rejection. Also, in 2008, the Indian media carried a story of how the government, overruling objections by the Ministry of Finance, had cleared the deal despite deviations in tender parameters. But these impediments proved inconsequential.