India puts on hold defence deals with Finmeccannica

In the wake of alleged chopper scam, India has put on hold all procurements from Italian defence group Finmeccannica and its affiliate companies, a move that will hit hard acquisitions for the armed forces as it is taking part in projects worth over Rs 30,000 crore.
In separate circulars, Department of Defence and Department of Defence Production have said that "all procurements/acquisitions cases in pipeline with Finmeccannica group of companies including its subsidiaries and affiliates" should be put on hold.
The orders, accessed by PTI, say that there should be "strict compliance" by all the three services and Public Sector Units, Ordnance Factory Board and other concerned departments under it with its orders in this regard.

Finmeccannicca is the parent firm of AgustaWestland, which was accused of paying kickbacks to the tune of over Rs 360 crore in the Rs 3,600 crore deal for supplying 12 VVIP choppers to the air force and the deal has since been scrapped.
The Ministry has also asked the departments under it to stop any kind of dealings with the firms named in the VVIP chopper scam FIR including AgustaWestland, IDS Tunisia, IDS Mauritius, IDS Infotech, Mohali and Aeromatrix Solution Limited, Chandigarh.
After the chopper scam broke out, Government had decided to go slow on defence deals with the Finmeccannica group but this is the first time it has issued orders to put the deals with the group on hold.

The two circulars, issued within months after the Modi government took over, may also hit Navy's requirements for radars as Finmeccannica group company Selex is involved in programmes such as the Indigenous Aircraft Carrier with its radars.