Deal scrapped 2nd time in 7 years
The tender for this acquisition was cancelled originally in 2007 after alleged irregularities. After that a fresh tender was issued which has been cancelled now.
The Narendra Modi government swung into action on Friday, scrapping a seven- year- old global tender worth thousands of crores for the acquisition of 197 helicopters for the Army and Air Force after allegations of corruption.
The cancellation of the global tender for the 197 helicopters — floated way back in 2007 by the UPA- 1 government — was perhaps the most significant step on Friday. This is for the second time in seven years that the global tender for this proposed acquisition was cancelled. The deal was worth $ 600 million when the tender was issued in 2007, but it is estimated that the cost may have gone up at current prices to about $ 1 billion ( about ` 6,000 crores). This time the cancellation was done after allegations earlier that an Army brigadier involved in the field trials had demanded a huge bribe from one of the foreign vendors. The tender for this acquisition was cancelled originally in 2007 after alleged irregularities following which a fresh tender was issued which has been cancelled now. Of the 197 helicopters, 133 were believed to be for the Army and the remaining 64 for the IAF. The European Eurocopter and the Russian Kamov helicopters were in the fray for the deal. The light- utility helicopters were meant to be a replacement to the ageing fleet of Chetak and Cheetah helicopters that carry troops and equipment to highaltitude areas such as the Siachen glacier. But just two weeks after Prime Minister Narendra Modi pledged —- from the ramparts of the Red Fort — to boost indigenous manufacturing, the ministry of defence ( MoD) said the acquisition of the 197 helicopters would now be as per the “Buy and Make ( Indian)” category which essentially means that an Indian company can enter into a Joint Venture ( JV) with a foreign firm and then bid for the contract. Sources said the government has estimated that this will generate business worth a whopping ` 40,000 crore for the Indian industry. After the loss of the frontline conventional INS Sindhurakshak submarine in August last year, the DAC decided that six ageing naval submarines would undergo mid- life upgrades and refits and receive a certification that would ensure that the Navy can use these submarines for a longer period of time. This will cost about ` 4,800 crore.
Four of the six submarines are Russian- built and of these two will be sent to Russia for the upgrades and refits while the other two will undergo the refits at Indian dockyards. The remaining two German- built submarines will also undergo refits at Indian dockyards with assistance from the original manufacturer. In a major boost to the Army’s firepower, the DAC approved procurement of 118 indigenously- developed Arjun Mk II Main Battle Tanks ( MBTs) for ` 6,600 crore.