Modi Irradiates Loopholed Defence Procurement

With the world at large progressing with positive speed and the concept of globalization seeing its frutation with the spread of co-operative and collaborative networks worldwide; among the civic, economic and political spheres, the defence sector of any nation in the modern era becomes the top-priority so as to ensure national and international security, as well as to facilitate defence trade between nations.

In lieu with PM Narendra Modi’s commitment of augmenting India’s defence capabilities so as to step ahead with his dream of positioning India in the top-notch list of global powers, India has never shied away from strengthening its defence sector under his governence.

Not only the advanced assortment of arms and ammunition of India speaks of its defence calibre, but also its cordial strategic defence partnership with major powers like the US and Russia throw positive light on India’s intention of augmenting its defence capabilities, without compromising on its ethics as it respects all international conventions.

India with its strict measures and determined spirit of its national leader, has never subsided to take stern and targeted measures, when any possibility of occurrence of fault line surfaces the defence milieu. One of the major problems haunting the defence arena of the country is the identification of the problematic presence of middleman or agents in the field. The laws governing the defence sector of India forbid the use of middlemen or agents by military vendors to secure contracts per the successive editions of India’s Defence Procurement Procedure (DPP).

Under the Defence Procurement Procedure (DPP), all the defence material suppliers are obliged to sign an ‘Integrity Pact’ that outlines that any deal would be terminated if this rule regarding the use of agents is breached at any stage of the contract, even after it was concluded. In case of occurrence of breach of ‘Integrity Pact’, vendors are also obliged to make a complete refund of the materials procured.

In a recent move under the Defence Procurement Procedure (DPP), the Indian Ministry of Defence (MoD) has announced a one-year trade ban on Pilatus- a Swiss aircraft manufacturer. The one-year trade ban on Pilatus per the notice issued by the Ministry of Defence (MoD), published on 15 June, 2019, is a follow up of earlier trade suspension with Pilatus.

The Ministry of Defence (MoD) of India and the Swiss aircraft manufacturer, Pilatus entered into a contract that was signed in 2012 and featured the sale of 75 Pilatus PC-7 Mk II tandem-seat basic trainer aircraft to the Indian Air Force.

Under the contract Pilatus was to make the required delivery between 2013 and 2015. The overall contractual value of the deal between the firm and the Ministry of Defence was about USD 1 billion. The ban on Pilatus is the resultant of an investigation launched by the Ministry of Defence (MoD) in 2016 into Pilatus for the suspected participation of a middleman in the PC-7 procurement. The 15th June notice added that the investigation was launched after the MoD “received reports of engagement by agents” by Pilatus for assistance in the sale of basic trainer aircraft.

The Central Bureau of Investigation (CBI) of India as part of its inquiry into suspected misconduct in defence procurement activity by Pilatus has filed a First Information Report (FIR) after which the MoD issued the notice stating the suspension of business ties with Pilatus for a year starting from 15th June, 2019. Other investigations into Pilatus are also being carried out by Ministry of Finance’s Directorate of Enforcement and Income Tax Department, per the Ministry of Defence. The move definitely showcases India’s sternness when it comes to adhering to laws and regulations, especially when national security and security of defence personals as well are kept into account.

The action taken by the Ministry of Defence shows India’s intolerance towards breach of contract and regulations, and passes a message of warning for other defence suppliers to check their moves.

Source: NewDelhiTimes

Image Courtesy: India