The government has decided to cancel all ongoing tenders for defence equipment won by Italy’s Finmeccanica as a precursor to blacklisting the firm being investigated for bribery in the AgustaWestland VVIP chopper deal.
In an interview to PTI, defence minister Manohar Parrikar also said the process for blacklisting Finmeccanica and its subsidiaries – AgustaWestland is its British unit-- had started and a note sent to the law ministry.
“Wherever there is capital procurement of Finmeccanica and their subsidiaries, all requests for proposal (RFP) will be closed. I am very clear,” he said.
However, the annual maintenance and import of spare parts of already acquired supplies would be continued with the firm and only fresh capital acquisition was being nixed.
The government has already withdrawn the RFP for heavyweight torpedoes for Scorpene submarines which was won by WASS, a Finmeccanica subsidiary, during UPA regime.
“The blacklisting process has already been moved. If there is a blacklisting for a specific number of years, which will be issued in the order, there will be no transaction by the defence ministry with that company for capital procurement for that many years,” he said.
The ministry, Parrikar said, had put on hold new transactions with the company.
“In revenue acquisition, where contracts have already been executed, annual maintenance and import of spare parts will be permitted where it is absolutely essential but with proper certification from concerned authority in order to ensure that platform or equipment remains operational,” he said.
Emphasising that national security “cannot be compromised” just because the company had done something wrong, he said, “I cannot put six ships of mine out of commission because one spare part is to be imported from some company of Finmeccanica.”
Asked about the fate of projects in which Finmeccanica was to play a crucial role in supply of equipment, Parrikar said, “Is there only one product in the whole world? There will always be products by Russian companies, American companies or some others. May be slightly costlier and difficult to get”.
A number of under-construction naval platforms such as four destroyers of the 15B (Visakhapatnam-class) and next seven ships of the Shivalik-class stealth frigates are to be armed with the 127mm Oto Melara main gun. Oto Melara is a Finmeccanica firm.
The gun was to be inducted into the navy’s training schools too.
The navy was also in talks to induct short-range surface-to-air missiles from European consortium MBDA, in which Finmeccanica has a stake.
Also on the anvil were torpedo counter-measure suites through a joint programme of state-run Bharat Dynamics and Finmeccanica besides collaboration on network centric warfare prototype between Bharat Electronics and a subsidiary of Italian firm.
Finmeccanica subsidiary Selex ES is also involved in the supply of RAN-40L 3D air surveillance radars for the 40,000- tonne indigenous aircraft carrier which is under construction at Cochin Shipyard.