India scraps tender for buying light utility helicopters

India's defence ministry has scrapped the over Rs.6,000 crore worth tender for procuring 197 light utility helicopters for army and air force which had been on hold due to a CBI probe on allegations that an army official had sought to a bribe from a contender, official sources said.

They said that the decision was taken Friday at a meeting of the Defence Acquisition Council headed by Defence Minister Arun Jaitley.

The sources also said the government also cleared proposals worth over Rs.17,500 crore including the upgrade of submarines and procurement of 118 Arjun Mk II tanks.

They said the DAC decided to retract from the tender for procuring 197 helicopters and the Indian industry would be given the opportunity to produce around 400 such choppers to meet needs of the armed forces.

The process had been on hold for over two years and the Central Bureau of Investigation was probing the matter following allegations of wrongdoing.

AgustaWestland, which is already facing a probe concerning the VVIP chopper deal, was eliminated in the first round aand Eurocopter and Kamov were left in the race. There have been allegations that an army official had sought a bribe from AgustaWestland to help it bag the contract.

The decision to give opportunity to Indian industry to produce light utility helicopters is in line with the government's moves to give a push to indigisation and is expected to generate business of thousands of crores for the local industry. The helicopters would replace Cheetah and Chetak choppers used to move troops and equipment to Siachen and other places.

Sources said that the DAC also gave its nod for setting up dedicated mobile communication systems for soldiers deployed along the China border.

The meeting also gave a green signal to the navy to open the bids for procuring 16 multi-role helicopters and cleared a proposal for an anti-submarine warfare suite for warships.

The sources said the meeting also deferred the decision on army's proposal for procuring the Israeli anti-tank guided missiles in view of the US offer to jointly produce the Javelin missiles.

The meeting also cleared proposal for offsets deviation in the deal for buying Chinook and Apache attack helicopters from the US.