Defence ministry to review UPA policy of blacklisting key global military contractors

May 30 2014, 11:38 IST
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SummaryBlacklisting of key global military contractors had resulted in slowing down modernisation of armed forces.

The Ministry of Defence is set to review the UPA government’s policy of blacklisting key global military contractors on allegations of misconduct, which had resulted in slowing down modernisation of the armed forces.

Indicating that a relook is in the offing, Minister of State for Defence Rao Inderjit Singh has said the government has come with a “fresh mind” and the policy of blacklisting major weapons suppliers has stalled critical procurement programmes for years on mere allegations by competitors.

“A new government has come with a fresh mind and as a fresh chapter for India’s policy. If a person or a company has been found guilty, they should be punished as strongly as possible. But before guilt is established, if a contract is cancelled, it is unfair. A review is needed,” Singh told The Indian Express in reply to a question whether the government would reconsider blanket blacklisting of global firms.

As reported by this newspaper, a number of major contracts ranging from light helicopters for the Army to howitzers and battleships have been delayed for years by the last government after allegations of impropriety. Several of these projects are critical to the operational preparedness of the forces and have direct implications on national security.

Singh, who had served in the same portfolio during UPA 1, said the blanket ban of arms companies across the world has left the armed forces with hardly any basket of suppliers for critical needs. “As I recall from my last stint here, there were very few producers of howitzers as they were simply getting banned or blacklisted and now no one is left. So, how does the Army get its weapons?”

Singh said that on several occasions, contracts have been axed by the previous government on mere complaints by competitors even after years of effort have been put up by the armed forces to see them through, severely affecting modernisation.

“The trouble is that when a contract is decided, complaints start coming in from the losing side. In the past, contracts have got axed on unsubstantiated allegations and equipment that was being procured for years has gone down the [drain]. This is not right,” Singh said.

Making a pitch for indigenisation of defence equipment, Singh said a thrust area for the government will be to encourage the private sector to compete with PSUs to build capabilities. “A country is only as strong as its own built-up capabilites. If you

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