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National
Defence Ministry scraps Rs 6000-cr light utility helicopter purchase deal
30-08-2014

NEW DELHI: Defence Ministry on Friday scrapped a scam-tainted tender worth over Rs 6,000 crore to procure 197 light utility helicopters for Army and Air Force to replace the vintage fleet of Cheetah and Chetak choppers used to move troops and equipment to high altitude locations like Siachen.

In a meeting of the Defence Acquisition Council headed by Defence Minister Arun Jaitley, the government also cleared proposals worth over Rs 17,500 crore including the mid-life upgrade of the aging fleet of submarines for Rs 4,800 crore and procurement of 118 Arjun Mk II tanks for Rs 6,600 crore.

The DAC decided to retract from the tender for procuring 197 helicopters and it has been decided that the Indian industry would be given the opportunity to produce around 400 such choppers for the requirements of the armed forces, Defence Ministry sources said here.

In line with NDA government’s plan to develop the indigenous industry, the government decision is expected to generate business worth over Rs 4,00,000 crore for the local industry in the defence sector, they said.

This is the second time in seven years that the tender has been scrapped in which European Eurocopter and Russian Kamov were competing and it had been on hold for the past over two years due to an ongoing CBI probe and other allegations of wrongdoings in the trial process.

The CBI probe was ordered into the deal in view of allegations in the AgustaWestland chopper scam that a Brigadier had asked for a bribe of Rs 30 crore from the Anglo-Italian firm for helping it in the light chopper deal.