NEW DELHI — India's Ministry of Defence (MoD) is investigating Italian company Fincantieri over the has begun an internal probe involving yet another Italian company. Last week MoD initiated probe against purchase of two fleet tankers under the Indian National Congress-led government in 2009.
An MoD official said the probe is based on a complaint by an unnamed Indian Navy official who alleged that the tender for purchase of the tankers was manipulated to create a single vendor situation in favor of Fincantieri. The shipbuilder had won a $300 million tender in 2009 to supply two fleet tankers to the Indian Navy.
The Indian Navy had floated global tenders in 2005 to buy two tankers for the Indian Navy in which Russian, South Korean and Italian shipyards responded. One of the essential requirements was that the hull of the tankers would be constructed with superior, military-grade steel.
The requirement was lowered in the case of the Italian company after eliminating the other competitors in technical evaluation, thus the contract was given on a single-vendor basis, the complainant alleged, according to the MoD official.
The complainant had also alleged that one of the Italian-made tankers, INS Deepak, was deployed to accompany the aircraft carrier INS Vikramaditya from Russia en route to India in December 2013. However, at high seas near Lisbon, choppy waters and cold temperatures and allied factors caused two four-inch cracks in the upper structure — an unusual case for a brand new fleet tanker. INS Deepak had to be towed into the Lisbon harbor for necessary repairs.
The MoD official, referencing a 2010 report by India's autonomous auditing agency, Comptroller and Auditor General, said fleet tankers under construction by a "foreign vendor" did not meet the specifications of the steel as envisaged in the request for proposals.
AgustaWestland, a subsidiary of Italian company Finmeccanica, is also under investigation by the Central Bureau of Investigation for alleged corruption involving the purchase of 12 VVIP helicopters in 2010.