Against the backdrop of bribery allegations in the VVIP chopper deal, a top panel from the Ministry of Defence (MoD) will meet here on Tuesday to take a call on the proposed changes to the defence procurement policy, which include providing the Indian defence industry the first right of refusal to take up a military project.
The Defence Acquisition Council (DAC), in its meeting, will also consider for approval a revised defence production policy that will focus on increased indigenisation of military equipment to meet the needs of the 13 lakh-strong Indian armed forces.
Another important procurement proposal that will come up is the tender for purchasing 197 Light Utility Helicopters (LUH), all worth Rs 15,000 crore, of which 64 will go to the Indian Air Force (IAF) and the other 133 to the Indian Army.
Chaired by Defence Minister A K Antony, the DAC members consist of Minister of State for Defence Jitendra Singh, Army chief General Bikram Singh, Navy chief Admiral D K Joshi, Air Force chief Air Chief Marshal N A K Browne, DRDO chief V K Saraswat, Defence Secretary Shashikant Sharma, Defence Production Secretary R K Mathur, Director General Acquisition Satish B Agnihotri and others.
Following the arrest of Italian defence major Finmeccanica’s then chief Guiseppe Orsi by Italian authorities over corrupt practices in global deals, the `3,546 crore Indian contract for 12 VVIP helicopters from the company’s wholly owned subsidiary AgustaWestland came under the scanner, after prosecutors submitted a chargesheet before a Milan court that bribes were paid in the deal.
The MoD, immediately, handed the matter over for a CBI probe and stopped further payments and delivery of helicopters. India has already paid about half of the contract amount to AgustaWestland for the 12 three-engine AW-101 helicopters, of which three were delivered to the IAF in December last year.
The MoD has also issued a show-cause notice to AgustaWestland as to why the contract should not be cancelled and bank guarantees given by the Italian firm encashed.
Since the corruption charge flew thick and fast in the AgustaWestland deal, Antony has repeatedly stated that the only answer to stop defence procurement scandals is to produce weapons and military systems indigenously.
He suggested that India reverse the trend of 70 per cent defence imports in favour of domestic sourcing and try and bring imports down to 30 per cent.
In this regard, one of the proposals before the DAC is to change the defence procurement policy to make it mandatory to explore indigenous options for military products and go in for imports only if the domestic players throw their hands up on timely supplies and quality. The procurement policy was last revised in 2011, along with the introduction of a new defence production policy, which will come for its first revision this year.
