MoF said no,so scrapped refueller deal: Antony

At the same time,the Finance Ministry gave the go-ahead for a deal to procure 12 VVIP helicopters — on which it had reservations earlier because of the high price tag — due to security considerations.

Antony said the Defence Ministry sent the tanker contract for clearance thrice to the Finance Ministry but was forced to withdraw it due to the latter’s disapproval.

“We had sent it to the Finance Ministry three times. Unless Finance Ministry agrees to take it up with CCS,we cannot go ahead. Finance Ministry told us categorically they will not support it (in the CCS),” he said,responding to a query on cancellation of the deal.

As first reported by The Indian Express,the contract had been put on hold in September last year after the Finance Ministry questioned the need to purchase a new fleet of tankers other than the IL-78s already in service and raised objections to the high price of the Airbus aircraft.

The cancellation of the contract last month came as a major blow to European consortium EADS which was very close to bagging the $2-billion deal to supply six refuelling aircraft to the IAF.

While the tanker deal was cancelled on financial grounds,the government last week cleared another major contract to procure 12 VVIP helicopters that would be used to transport the President,Prime Minster and senior government dignitaries.

This,despite there being similar reservations by the Finance Ministry on the price of the contract as well as the “single vendor situation” that had led to the selection of the AgustaWestland AW 101 helicopter.

Seeking to defend the government’s decision on acquiring the helicopters while giving the tankers a miss,Antony said the Finance Ministry supported the helicopter deal after the Special Protection Group (SPG) insisted that new choppers were required in view of the changed security scenario.

“Not only the Air Force but the SPG also was involved. They told us due to the security scenario,we should consider this proposal and the Finance Ministry also agreed to take their comments and it was cleared by the Cabinet Committee on Security,” he said.

The cancellation of the tanker deal had created a diplomatic row with Germany publicly saying that the turnaround came as a “nasty surprise”. German Ambassador Thomas Matussek last month said it came as a nasty surprise that the deal was rejected at the political level.