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Defence contracts: Centre bans 5 defence firms

NEW DELHI: Continuing the jinx that has plagued the Indian Army’s artillery modernisation programme, the Centre on Monday banned gun-maker Singapore Kinetics, along with other five other defen

Published: 06th March 2012 02:03 AM  |   Last Updated: 16th May 2012 06:30 PM   |  A+A-

NEW DELHI: Continuing the jinx that has plagued the Indian Army’s artillery modernisation programme, the Centre on Monday banned gun-maker Singapore Kinetics, along with other five other defence firms,  following corruption charges against them.

The 10-year ban imposed on the companies would effectively mean that the Indian Army, which has not inducted a single gun in its inventory since 1987 and is left with only half of its 410 guns it had procured, will have to wait longer and limited options to source its artillery.  

Singapore Technologies Kinetics Ltd is the third gun-manufacturer after the Swedish AB Bofors and South Africa’S Denel to be barred from defence-related contracts offered by New Delhi.

The ban has also thrown the Army’s artillery acquisition plan into disarray, as the force had already conducted extensive trials of the guns offered by the Singapore Technologies for the three tenders it had floated for 155 mm howitzers for the mountains, the plains and self-propelled guns for the deserts in 2008.

“Presently, we are not taking giving any response and will decide on our next course of action after due deliberation,” an Army official said on condition of anonymity.

The six companies have been debarred from “further business dealings with the Ordnance Factory Board, Department of Defence Production, Ministry of Defence (MoD), for a period of 10 years,” an MoD communique stated.  The five other firms blacklisted include the Israel Military Industries Ltd (IMI), German Rheinmetall Air Defence (RAD), Corporation Defence, Russia (CDR), TS Kisan & Co. Pvt. Ltd and RK Machine Tools Ltd.

It was in the wake of corruption charges against these firms that led to them being blacklisted by the MoD in 2009. The MoD had put the dealings with all these firms “temporarily on hold” and had sought the Law Ministry’s opinion on how to proceed with the case, as the companies were involved in certain key defence projects.

Showcause Notice

“The firms were recommended for blacklisting by the CBI on the basis of evidence collected against them. These firms were issued  to showcause notice as to why action against them should not be taken consequent to the filing of the chargesheet in the case related to illegal gratification against former Director General of Ordnance Factories Sudipto Ghosh and others. The decision to debar was taken today after taking into consideration their replies,” the MoD said.

Against the backdrop of the limited options available to the Army following the ban, the  artillery procurement plan has been left in the lurch.



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