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 AgustaWestland.
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 said.
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.
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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. The DAC had also approved the revised schedule of delivery of Project-75 submarines called Scorpene being built by the Mazagon Dockyards Limited in Mumbai in cooperation with French firm DCNS.
The submarines were slated to be delivered in 2012 but now the first vessel is expected to be delivered in September, 2016 as per the new schedule approved by the DAC, the sources said. The meeting has also cleared a proposal to procure training simulators of the P-8I anti-submarine warfare aircraft for the Indian Navy, they said.
The simulators worth Rs 1,226 crore would help the Navy in training its officers and men for operating the aircraft in the country itself as sending personnel again and again to the US for training was proving to be expensive, sources said. India has signed a deal worth around Rs 12,000 crore for procuring eight P-8I anti-submarine warfare and surveillance aircraft from the US and is planning to buy four more under the repeat order clause.
Other deals cleared in the meeting include the Rs 9,000 crore tender for the construction of five Fleet Support Ships for the Navy, which will be built by the private sector shipyards in the country.
The vessels would be used by the Navy to support the operations of the aircraft carrier fleet of the force in the future. The DAC also approved a proposal for procuring 32 ALH Dhruv choppers to be equally divided between the Coast Guard and the Navy at a cost of Rs 7,000 crore.