The government is looking into complaints against the procedure to determine the winner of the multi-billion dollar combat aircraft deal, Defence Minister A K Antony said Thursday as he admitted that there was no money to sign such a big deal this fiscal.
“There are complaints about the procedure of calculating the life cycle cost and that issue is not yet settled. Before bringing the deal before the Cabinet Committee on Security for final approval, we would like to get clear on that aspect,” he told a press conference.
Antony hoped the deal will be finalised in 2014-15.
France’s Rafale fighter aircraft has been the lowest bidder in the medium-multirole combat aircraft deal, which is touted as the “mother of all deals” and is expected to cost India more than Rs 60,000 crore.
As per the Indian defence procedure, firms offering the lowest prices and meeting the requirements of the respective services are given the contract and in this deal to procure 126 combat aircraft, the LCC has been taken into view to determine the lowest bidder.
Senior BJP leader and former finance minister Yashwant Sinha has written to Antony raising a number of questions over the “conceptual shift” in the defence procurement policy and expressed fears that the LCC concept may bring in corruption.
Asserting that the negotiations in the deal were still progressing, the defence minister said the financial condition of the government was not good and “there is no money for this.”
“Almost all the budget has been spent. Many other projects are also in the pipeline,” he said.
Asked whether the government would buy more Su-30 MKI combat aircraft from Russia if the deal with the French aircraft manufacturer does not fructify, Antony expressed hope that, “The MMRCA will materialise next year.”
He said the government was making headway in the deal and taking all possible care in the process to ensure there are no loose ends.