India to encash AgustaWestland’s bank guarantee | india | Hindustan Times
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India to encash AgustaWestland’s bank guarantee

india Updated: Jan 03, 2014 01:16 IST
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AgustaWestland’s troubles mounted a day after India terminated a controversial Rs 727-crore contract for 12 VVIP helicopters. New Delhi on Thursday set the ball rolling for encashing the bank guarantees of Rs 2,975 crore deposited by the UK-based firm to secure the payments already made to it.

India is also likely to seek hefty damages from the chopper firm, possibly to the tune of Rs 5,525 crore, a source said.

The damages sought account for 15% of AgustaWestand’s revenues of Rs 36,000 crore last year. India scrapped the contract with AgustaWestland, a subsidiary of Italian defence group Finmeccanica, for allegedly paying Rs 375 crore in kickbacks to middlemen, invoking an integrity pact to punish the firm.

"We are invoking contractual provisions to ensure India does not lose a single rupee and a strong message is sent," the source said. . The UK government on Thursday backed the Anglo-Italian company.

A UK government spokesperson told HT: "This is a matter for the company and the Indian Government. AgustaWestland produces world class helicopters for both the UK Armed Forces and export markets, including a recent £1 billion contract to supply 16 helicopters plus support and training to the Norwegian government."