Govt to cancel all Finmeccanica’s defence tenders

The Dollar Business Bureau

India has decided to cancel all the current tenders for the defence equipment that was won by Italy’s Finmeccanica. The firm is currently undergoing bribery investigation in the Augusta Westland VVIP chopper deal.

Defence Minister Manohar Parrikar, in an interview to PTI, said the government is in the process of blacklisting the firm and all its subsidiaries, and a related letter has already been sent to the Ministry of law.

"Wherever there is capital procurement of Finmeccanica and their subsidiaries, all Requests for Proposal (RFP) will be closed. I am very clear," Parrikar said.

The import of spare parts and annual maintenance of the existing defence supplies with the firm, as the defence minister further said, will continue. However, all the new capital acquisition with the company will be cancelled.

During the UPA regime, the government had already withdrawn the RFP for heavyweight torpedoes in the Scorpène-class submarines, which was won by a subsidiary of Finmeccanica, WASS. 

"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," the defence minister said.

Parrikar underscored that he cannot compromise on national security as the company has done wrong. He also cannot take six ships out of commission, because one spare part needs to be imported from some of Finmeccanica’s arm. The defence ministry has also kept the new transactions of the company on hold.