There were “substantial delays” in India placing an order for 21 Westland helicopters because of “anti-British” feelings in the country following the assassination of former prime minister Indira Gandhi in 1984, archival documents released on Friday revealed.
A large cache of documents from 1986-88, when Margaret Thatcher was the prime minister, were released by the National Archives, shedding new light on official thinking on bail-out packages for ailing Westland and the related resignation of former defence secretary Michael Heseltine.
India had sent a letter of intent in 1984 to purchase 21 W30c Westland helicopters for the Oil and Natural Gas Commission. The Thatcher government agreed the purchase could be financed from the aid programme and £65 million were allocated.
A reference document of January 10, 1986 from the defence ministry to the Cabinet Office said: “Westland started to manufacture the aircraft. However, there were substantial delays which appeared at least in part to be associated with anti-British feeling in India following Mrs Gandhi’s assassination.”
It added: “The Government informed Westland...that it considered the prospects of the Indian order were good and that it saw no immediate necessity for underwriting.”
Recalling former prime minister Rajiv Gandhi’s visit to Britain in October 1985 and keen to maintain secrecy of some parts, the covering letter to the document said: “All the material can be used publicly, except perhaps the references to: Ministers judging that the prospects of an Indian order were good after Mr Gandhi’s visit in October 1985; (and the) details of the rescue proposals and HMG’s decision not to underwrite the Indian order.”
Rajiv Gandhi previously had a “frank” discussion on the Westland deal with Thatcher in Moscow in March 1985.
CD Powell, Thatcher’s private secretary, recorded: “Mr Gandhi said that the ‘technical chaps’ were giving problems. They preferred a French helicopter. The Westland one was too big and consumed more fuel though it was cheaper to operate per seat.
“The real trouble was that it did not quite meet the particular needs and it was an untried model. But the matter was not settled yet. The Prime Minister said that this posed serious problems. She had thought that the technical difficulties had been overcome.
“She wished someone had been as frank with us before. We had assumed that signature was only days away.”
India later bought the Westland helicopters in the £65 million deal that was linked to British aid, and which helped bail out Westland. The entire lot was later re-sold by India to Britain for its scrap value.
The deal’s link to British aid was clear from the record, which said: “Sir Geoffrey Howe (the then British foreign secretary) said that the view in London was that the Indian government had accepted the purchase in principle and on that basis the helicopters had been manufactured.
“The only problem of which he had been aware was to get the signature of the contract before our financial year ended on 31 March to avoid a shortfall on this year’s aid budget.”