India to cancel Rs 3600 crore-chopper deal with Augusta

[kurup]

Armed with fresh details on the alleged kickbacks, India has initiated steps to cancel the Rs 3,600 crore-chopper deal with Anglo-Italian firm AgustaWestland by issuing a show cause notice to it in this regard.

The latest initiative by the defence ministry comes soon after the attorney general gave his opinion that there was breach of contractual obligations and the integrity pact by the firm, sources said in New Delhi.

The defence ministry has issued a showcause notice to the firm for cancellation of the deal and given it four weeks time to respond to it, they said.

The ministry has also gathered important details during the ongoing investigations in the deal in both India and Italy since February.

The government has already frozen the contract for supply of 12 AW-101 VVIP choppers to the Indian Air Force after allegations that Rs 360 crore were paid as bribe in which two top officials of the company were accused. The IAF has already received three helicopters and delivery of the rest has been put on hold.

Last week, the company said it has invoked arbitration proceedings against the defence ministry for "unilaterally" freezing the deal. The law ministry has also told the defence ministry that the arbitration proceedings initiated by AgustaWestland are also not binding on it.

The sources claimed that the government had been preparing to issue the notice for cancellation much before AgustaWestland took the step.

The defence ministry had earlier issued a show cause notice to AgustaWestland on February 15 asking it to explain within seven days the bribery allegations against it after the alleged scam was exposed in Italy.

In the notice, the company was asked why the Rs 3,600 crore deal of 2010 should not be scrapped. In its reply, AgustaWestland had denied the allegations.

Former IAF chief S P Tyagi is among those under cloud in connection with the kickback charges. The CAG also recently highlighted loopholes in the deal.

Soon after the arrest of the firm's former CEO, Guiseppe Orsi, in Italy in connection with the case, Defence Minister A K Antony had suspended the payments to be made to it along with the delivery it was due to make to IAF of the remaining nine choppers.

Defence News - India to cancel Rs 3600 crore-chopper deal with Augusta

 

[anant_s]

Well this was on the cards wasn't it? The only silver lining to the whole issue is that the deal was for VVIP transport and not more priority defence hardware where ultimate victim would've been the armed forces for no fault of theirs.
Any news of re-tendering the choppers?

 

[Raje amar]

Good step.

By the how much did we already paid to the company?

 

[janon]

Let them use Mi-17s to transport VVIPs. If the Russian president can fly in Mi-8s, I don't see why the Indian VVIPs can't travel in suitably modified Mi-17s. We already have such a large fleet of those.

 

[Sugarcane]

I think parties involved forgot attorney general's share otherwise VVIPs are true VVIPs in south asia.

 

[Abingdonboy]

And these people are only just waking up to this news? The MoD took this absurd step back in June/May time.


Guys this isn't what you're thinking. To date NO ONE has been able to prove any actual wrong-doing in the Italian hearings against former CEO of FINMECCANICA relating to the Indian-AW 101 deal.


India is in for a whole world of hurt mark my words now.


AW has already begun the arbitration process against the GoI:

AgustaWestland invokes arbitration over India chopper deal


You simply cannot unilaterally cancel such deals because you want to.



The MoD jumped the gun in a bid to protect their own cowardly backsides and now the brown stuff is going to hit that fan.



AW actually has a VERY solid case and thus India could be left to pick up a heavy bill WHEN it loses this arbitration case and the requirement for VVIP choppers will still be unfulfilled, then what?


By 2017 the MI-17/8s currently in service for VVIP transport duties WILL BE out of service life and even today if you compare the AW-101 to the MI-17/8 in safety specs you're going to feel pretty sick.



Will it actually take the death of one of India's senior most leaders (PM, PRES or Service Chief) for the MoD to be shaken from their state of self-induced cowardice??



And to think this could all have been avoided if the MoD/GoI had any common sense:

AgustaWestland resorted to making an official request for legal arbitration with the Indian government over a stalled deal for AW101 VVIP helicopters because it "didn't see any other option".

says that despite frequent requests, he was unable to persuade anyone from the New Delhi administration to sit down and meet with him.

Even now, if the GoI gets their act together things can be sorted out:

"We were quite reluctant to start this process, but we didn't see any other option. We do hope this is just a way to have a very calm and open dialogue."

Despite the impasse, the airframer is keeping support staff in India to assist with sustainment activities on the in-service AW101s, as "an investment".

Arbitration, the possibility of which is contained within the contract, would see three individuals appointed - one nominated by each of the parties and a third jointly agreed - to a board to try to resolve the stalemate

http://www.flightglobal.com/news/ar...-was-last-resort-agustawestland-chief-391563/



The Indian media is doing a pi$$-poor job as usual in reporting the FACTS and is instead following quite a "scorched earth" approach to all this. Apparently now in India, just the allegation of a scam is enough to poison the well and cement opinions- forget due process eh?




The sheer stupidity and immaturity displayed by the GoI/MoD and Indian media is mind-boggling.

I think parties involved forgot attorney general's share otherwise VVIPs are true VVIPs in south asia.

Not in India, the CAG is truly independent.


Also the CAG report purely stated there were certain deviations from established requirement not that there was actual mal-practice or graft which is still yet to be proven BY ANYONE.

 

[Abingdonboy]

Let them use Mi-17s to transport VVIPs. If the Russian president can fly in Mi-8s, I don't see why the Indian VVIPs can't travel in suitably modified Mi-17s. We already have such a large fleet of those.

To compare the safety features on the Mi-17 even the latest V5 spec to the AW-101 is an utter joke.

 

[acetophenol]

These idiots will learn only when the antique Mi-8 in which our President and Prime minister fly,crashes. Replace'em immediately!

 

[Echo_419]

And these people are only just waking up to this news? The MoD took this absurd step back in June/May time.


Guys this isn't what you're thinking. To date NO ONE has been able to prove any actual wrong-doing in the Italian hearings against former CEO of FINMECCANICA relating to the Indian-AW 101 deal.


India is in for a whole world of hurt mark my words now.


AW has already begun the arbitration process against the GoI:

AgustaWestland invokes arbitration over India chopper deal


You simply cannot unilaterally cancel such deals because you want to.



The MoD jumped the gun in a bid to protect their own cowardly backsides and now the brown stuff is going to hit that fan.



AW actually has a VERY solid case and thus India could be left to pick up a heavy bill WHEN it loses this arbitration case and the requirement for VVIP choppers will still be unfulfilled, then what?


By 2017 the MI-17/8s currently in service for VVIP transport duties WILL BE out of service life and even today if you compare the AW-101 to the MI-17/8 in safety specs you're going to feel pretty sick.



Will it actually take the death of one of India's senior most leaders (PM, PRES or Service Chief) for the MoD to be shaken from their state of self-induced cowardice??



And to think this could all have been avoided if the MoD/GoI had any common sense:











Even now, if the GoI gets their act together things can be sorted out:











Indian arbitration request was last resort: AgustaWestland chief



The Indian media is doing a pi$$-poor job as usual in reporting the FACTS and is instead following quite a "scorched earth" approach to all this. Apparently now in India, just the allegation of a scam is enough to poison the well and cement opinions- forget due process eh?




The sheer stupidity and immaturity displayed by the GoI/MoD and Indian media is mind-boggling.



Not in India, the CAG is truly independent.


Also the CAG report purely stated there were certain deviations from established requirement not that there was actual mal-practice or graft which is still yet to be proven BY ANYONE.

I know one thing
Ecuadorian President Travels in a Dhruv,why don't our VVIPs travel in them
Hal can modify them & Best thing they are Ingenious.
They have not made us a First world Country that they deserve these,these are A-Grade Lotters,Scam Artists

 

[Abingdonboy]

I know one thing
Ecuadorian President Travels in a Dhruv,why don't our VVIPs travel in them
Hal can modify them & Best thing they are Ingenious.
They have not made us a First world Country that they deserve these,these are A-Grade Lotters,Scam Artists

Cabin space for one. Ecuador is a tiny nation, India is huge and a growing power. Why doesn't the US president travel by a Bell 429.


For many nations these mid-sized helos are the norm for Head of State transport, there's no need to point to isolated cases where small nations are using small helos for this role.




Hey even the US president/HMX-1 were going to get the AW-101 (well VH-71 by their designation),

that must say a lot about why this AW-101 was selected by the IAF.

 

[Gentelman]

These idiots will learn only when the antique Mi-8 in which our President and Prime minister fly,crashes. Replace'em immediately!

If our VVIPs were using Mi-8 in bad condition we would be like…
Oh please God let that heli crash and don't let these bastards survive……
our VVIPs like their bulletproof cars or private PIAs flight……

 

[janon]

To compare the safety features on the Mi-17 even the latest V5 spec to the AW-101 is an utter joke.

Which I why I said suitably modified. Besides, Mi-17s are supposed to fly into battle an evade missiles and survive in dense hostile SAM environments.

 

[Abingdonboy]

Which I why I said suitably modified. Besides, Mi-17s are supposed to fly into battle an evade missiles and survive in dense hostile SAM environments.

You can't suitable modify the Mi-17 to the same standards of AW-101. At a very basic level the AW-101 has 3 engines to the Mi-17's 2. The entire M-17/8 family share a relative safety deficit to Western and even Indian multi-engined helos- they make use of only a single-channel hydraulics-control system under which the hydraulic actuators of all four control circuits are mounted in a single hydraulic package on the main gearbox, together with other parts of hydraulic system. Western manufactures make use of dual-channel hydraulics-control systems as the single-channel approach is seen as too unsafe.


This is merely from a flight safety angle.


Wrt the SAM/Anti-air safety aspect yes a MI-17 could be given the same integrated defensive aids suite (IDAS) as the AW-101s (and the V5s, ALH MK.4, and LCH ARE in fact in the case of the lartest V5s entering iAF service).




Naturally in an ideal world it would be great if the troops got the same level of safety features as the head of state but this is impractical and actually not practiced anywhere in the world. Considering the AW-101s for the IAF's communication SQD were to cost 3-4 times the base price of a V5 it's clear to see what the limiting factor is here.

 

[Bang Galore]

Guys this isn't what you're thinking. To date NO ONE has been able to prove any actual wrong-doing in the Italian hearings against former CEO of FINMECCANICA relating to the Indian-AW 101 deal.


......
The Indian media is doing a pi$$-poor job as usual in reporting the FACTS and is instead following quite a "scorched earth" approach to all this. Apparently now in India, just the allegation of a scam is enough to poison the well and cement opinions- forget due process eh?




.....The sheer stupidity and immaturity displayed by the GoI/MoD and Indian media is mind-boggling.



Not in India, the CAG is truly independent.


Also the CAG report purely stated there were certain deviations from established requirement not that there was actual mal-practice or graft which is still yet to be proven BY ANYONE.

This is not purely an Indian decision alone, it was the result of an Italian investigation which did cause people to be arrested. Hardly a case of there not being any substance. Whether or not the Italians proceed with their case and there is no reason to suggest that they won't, the evidence with Indian authorities must be sufficient to make out a case. Contrary to what you suggest, top legal officials aren't in the habit of completely speaking from their backsides.

The only problem here is that MoD has already advanced a substantial portion of the deal value & getting it back won't be easy.

 

[Abingdonboy]

This is not purely an Indian decision alone, it was the result of an Italian investigation which did cause people to be arrested. Hardly a case of there not being any substance. Whether or not the Italians proceed with their case and there is no reason to suggest that they won't, the evidence with Indian authorities must be sufficient to make out a case. Contrary to what you suggest, top legal officials aren't in the habit of completely speaking from their backsides.

The only problem here is that MoD has already advanced a substantial portion of the deal value & getting it back won't be easy.

NOT ONE PERSON has been arrested or charged in India or Italy over THIS case involving the FINMECCANICA subsidiary Augusta Westland and the deal for AW-101s for the IAF. NOT ONE. India was dragged into an internal Italian matter and actually Augusta Westland too- they were innocent in this entire affair.


If this goes to arbitration India WILL lose. Hopefully sanity prevails and the remaining 9 units are delivered and all sides win.