With the arrest of Finmeccanica CEO Giuseppe Orsi by the Italian authorities and a CBI investigation under way in India, the countdown would appear to have begun for baring the whole truth about a multi-crore defence deal finalised in 2010. The conglomerate Finmeccanica — the parent company of AgustaWestland — struck a Rs 3,546 crore deal with the Indian government for the supply of VVIP choppers. A preliminary report of Italian investigators alleges a bribe was paid by Finmeccanica to a former Indian Air Force chief to swing it in its favour. As this newspaper has tracked in reports since February 2012, a network of middlemen was crucial in the intricate web of transactions. At the heart of it is the allegation that the Indian side tweaked technical requirements — such as revising the operational ceiling down from 6,000 metres of altitude to 4,500m — to allow AgustaWestland to participate in the bid.
Even as the investigation uncovers the nodes of the money trail, however, the ministry of defence must be judicious in its reaction. The danger in the wake of the revelations in the AgustaWestland deal is that, as in the aftermath of Bofors, procurements may again be slowed, suspended or banned, apprehending scandal. Asked to prove its innocence, the system could again choose to retreat to the comforts of inaction and prevarication. Even as the leads must be rigorously pursued in the AgustaWestland deal, and the guilty brought to book, there is no justification for, and in fact high systemic costs attached to, a pre-emptive freeze on all major defence transactions. The Bofors scandal exposed the opaqueness and corruption in the procurement process. At the same time, its afterlife has framed the system’s tendency to lapse into inertia and indecision when faced with demands for greater accountability. As a result, the military is deprived of good and necessary equipment even as the system remains unreformed.
Sorting out the tangles of defence procurement is necessary for speeding up India’s military modernisation. After years of returning funds, a new beginning appeared to have been made when the armed forces spent the entire defence budget for 2010-11. One of the biggest upcoming deals involves the purchase of next-generation submarines. That is the sort of critical project which cannot be allowed to become a victim of the fallout from AgustaWestland. To begin with, as a practical measure, the MoD could take a cue from the US, train a set of military officers professionally dedicated to procurement. Eventually, the procurement process itself must be made more transparent and rule-bound.