Antony seeks report on pay-off in Italian chopper deal

New Delhi, April 25 (IANS) Defence Minister A.K. Antony Wednesday called for a fresh report from the Indian embassy in Rome on alleged malpractice in the Indian procurement of 12 helicopters for VVIP transport worth Rs.3,546 crore ($788 million).

'The defence minister today (Wednesday) directed his ministry officials to get a fresh report from the Indian embassy in Rome following a media report alleging malpractices in the procurement of 12 helicopters for the VVIP Communication Squadron of the Indian Air Force from AgustaWestland,' a defence ministry spokesperson said here.

These helicopters are meant for travel in style, comfort and in secure environs by India's political leadership, including the president, prime minister and others.

Media reports from Italy had suggested that it was carrying out its biggest ever probe into corruption in defence deals, as part of which it was investigating allegations that the Indian deal led to a payment of commission worth euro 51 million (over Rs.350 crore/$80 million).

The spokesperson pointed out that the contract for procurement of the VVIP helicopters contained the standard provisions 'against use of undue influence and employment of agents and payment of agency commission'.

'A pre-contract integrity pact has also been signed between AgustaWestland and the defence ministry,' he pointed out.

'Any such complaint or allegation received will be investigated and the contractual provisions invoked, in case any wrongdoing is established, in addition to action that may be required under law,' he added.

Only a fortnight ago, India had invoked the integrity agreement it had signed with Israeli Military Industries (IMI) for breach of contract in setting up plants at the Nalanda ordnance factory in Bihar for producing bi-modular charges for 155 mm artillery guns after the company was named in a graft case against former Ordnance Factory Board chief Sudipto Ghosh.

The Indian defence ministry had pocketed a cool Rs.227 crore that were provided as bank guarantee by IMI towards the integrity pact for the deal worth Rs.1,200 crore ($260 million).

Antony had also asked for a report from the Indian embassy in February this year when media reports suggested that the graft ombudsman of Italy was probing Finmeccanica, the parent company of AgustaWestland, for alleged corruption.

Then, the reports had suggested that the Italian ombudsman was probing the Indian VVIP helicopter deal too that was signed in February 2010 when India chose AgustaWestland's AW-101 choppers against its competitor US Sikorsky S-92.

'The Indian embassy reported that Italian authorities were conducting preliminary investigations on allegations of financial malpractices occurring within Finmeccanica and its subsidiaries in general. There was no specific probe being conducted on India-related transactions. There is no clear indication at this stage whether the India-related deal would be probed on the strength of preliminary investigations,' the spokesperson said.