Defence agents to be regularised by mid-February: Parrikar

Changes in the Defence Procurement Procedure to regularise representatives from foreign defence firms will be done in another month and a half, Defence Minister Manohar Parrikar said.

In an interaction with journalists Tuesday night, he also said that the ministry is thinking of reviewing all cases of blacklisted defence firms and may give conditional and limited approval to dealing with some firms based on merit.

The minister said that ban on Bharat Earth Movers Limited (BEML) has been partially lifted to get spare parts for Tatra trucks.

Parrikar said that a clause allowing representatives exists in the Defence Procurement Procedure (DPP), but there are no clear guidelines about what is not allowed.

"Agents, representatives or technical consultants from defence firms are already allowed in the Defence Procurement Procedure... the problem is it does not say what is not acceptable," he said.

"Changes will be made to the DPP, representatives will be allowed but commission, or percentage of profit for the deals will not be allowed. The representative's remuneration shall be declared by the company," he said.

Parrikar added that a draft of the changed policy is ready and a final draft will be ready in another 8-10 days. It will then go through further procedures before going to the union cabinet.

"The process shall be completed in another one and a half months," said Parrikar, but noted that those middle-men who have been banned by the ministry will not be permitted under the new arrangement.

Agents have an option to register themselves with the defence ministry under the existing DPP, but only a handful have done so.

Parrikar also said that banned firms can be conditionally allowed.

"Based on merit and necessity, one can think of lifting the ban to a reasonable level," he said.

Parrikar said the state-run Bharat Earth Movers Limited (BEML) has been allowed to supply spare parts for Tatra trucks as long as it does not deal with the British subsidiary of the company, which was banned following irregularities in its deal with BEML.

"Limited NoC (no objection certificate) has been given to BEML because we need Tatra trucks," he said.

"The company which has been banned is Tatra UK and we have permitted BEML to deal with the original company which is owned by different people now... but they should not have relation with questionable individuals," he said.

Tatra was banned in March 2012 after the then army chief General (since retired) V.K. Singh alleged that he was offered bribe to clear sub-standard trucks supplied by the company to the Indian Army.

Earlier, blacklisted Italian defence giant Finmeccanica's subsidiary AgustaWestland was allowed to do business in a limited capacity.

Finmeccanica was blacklisted due to alleged corruption in a VVIP chopper deal, worth Rs.3,600 crore.