Italian Contract Clouds Indian Helicopter Plans

AIN DEFENSE PERSPECTIVE » NOVEMBER 9, 2012

by  NEELAM MATHEWS

Deliveries to India of AW101s may be delayed because of procurement irregularities. (Photo: AgustaWestland)

November 9, 2012, 2:10 PM

As India’s Ministry of Defense awaits a response from the Italian government on alleged irregularities in the award of a contract for 12 AgustaWestland AW101 VIP transport helicopters, the fallout from this affair may scupper the much larger reconnaissance and surveillance helicopter (RSH) program. The Eurocopter AS550C3 Fennec and Kamov Ka-226T are the final contenders for the 197-aircraft RSH program, which has already been delayed.

Reports of malpractice in the AW101 contract emerged in Italian newspapers earlier this year. AgustaWestland parent company Finmeccanica denied the allegations, but the Indian MoD started an investigation. In a further statement released on October 26, the MoD said: “The Italian government has been requested to provide details of the existence, if any, of any middlemen or any individual or Indian entity in the [AgustaWestland] contract….[and] the name and relevant documents relating to the alleged involvement of a Brigadier in the ongoing process for the acquisition of 197 light utility helicopters for the Indian Army. MoD will take strong action against the offenders detected through this probe.”

Speaking on condition of anonymity, a defense procurement official said that if a link between impropriety in the AW101 contract and the RSH bidding process is proved, “the MoD might wait for the air to clear before taking delivery of the VIP helicopters. It is highly probable that it will then cancel the RSH bid.”

India has made an advance payment of “around 40 percent” to AgustaWestland.

The 12 AW101s are supposed to replace the aging Mi-8/17 helicopters that are currently used for the transport of VIPs, including the prime minister and president. They were due to “arrive any moment now,” an official close to the project told AIN.

Valued at approximately €560 million, the program includes five years of logistic support services and initial aircrew and technician training.