Defence Minister defers decision on Navy chopper deal over Agusta links

The NDA government has deferred its decision on the procurement of 16 multi-role helicopters for the Indian Navy as one of the two companies in the race for the deal is linked with Finmeccannica-- the parent organisation of the scam-tainted firm AgustaWestalnd.

PTI| Last Updated: Jul 27, 2014, 18:18 PM IST

New Delhi: The NDA government has deferred its decision on the procurement of 16 multi-role helicopters for the Indian Navy as one of the two companies in the race for the deal is linked with Finmeccannica-- the parent organisation of the scam-tainted firm AgustaWestalnd.

The Defence Acquisition Council headed by Defence Minister Arun Jaitley put off its decision on the procurement of the helicopters for the Navy from vendors including American Sikorsky and European NH Industries, which has Finmeccannica as one of its partners, highly-placed sources told PTI here.

Finmeccannica is the parent firm of AgustaWestland firm, whose Rs 3,600 crore contract for supplying 12 VVIP choppers to the IAF has been scrapped by the Government over the charges of paying kickbacks to Indian agents.

The government had cancelled AgustaWestland`s contract on January 1 and began the process of encashing bank guarantees of the Anglo-Italian firm worth around Rs 2,200 crore deposited in banks of Italy and India.

In its July 19 meeting, the DAC, which is the highest body in the Ministry to decide on procurements, the members had to decide on deviations sought by the two vendors in offsets proposal and the road ahead for the deal, sources said.

The deal has been hanging fire for several years now and has seen a series of anonymous complaints leading to a delay in the procurement of helicopters required by the Navy for its warships.

The Indian Navy has not inducted a single multirole helicopter for over a decade now and is presently flying the SeaKing choppers procured from the UK in the 1980s.

The first DAC meeting under Jaitley cleared proposals worth over Rs 21,000 crore including a go ahead for a tender to produce transport aircraft by indigenous private sector companies.