Indefensible Defence - Implosion: India's Tryst with Reality - page 240

earlier rifles order. In 2006, the defence ministry issued a list of 118 defence suppliers in
India and abroad that had been banned, including some named by DPSUs. 78
In March 2012, A.K. Antony, the defence minister, put a ten-year ban on six defence
firms originally blacklisted in 2009 after the head of India's ordnance factories was accused
of accepting bribes. The firms included Singapore Technologies Kinetic (STK) which was
involved with supplies of howitzer guns and small arms, Israeli Military Industries with
ammunition for Bofors guns, Germany's Rheinmetall Air Defence with land systems, and
a Russian corporation with military systems. The most serious effect of these bans and oth-
er delays is that India has not had new artillery guns since the 1980s, that there have been
shortages of ammunition and spare parts, and that ordnance factories delayed manufactur-
ing Bofors guns in a factory at Jabalpur in central India for over 20 years.
Antony used these bans to protect his reputation of not being corrupt, and ignored the
seriously negative impact it was having on supplies of military equipment. Eventually he
was heavily criticized in 2013 when he reacted to the Finmeccanica helicopters' corrup-
tion allegations by warning that the Augusta-Westland contract might be cancelled, even
though he had been ignoring public rumours of the alleged bribes for nearly a year till the
news of the case in Italy built up in India. Only three of the urgently needed 12 VVIP heli-
copters had been delivered when payments to Augusta Westland stopped, as were deliver-
ies of further helicopters, and the company began arbitration proceedings. 79 The contract
was then terminated by Antony. Tenders for 197 military helicopters on a $1.5bn potential
order, which had been stuck by a series of controversies for many years, also looked vul-
nerable because of allegations that an army brigadier in charge of field trials had asked for
a $5m bribe from the company though, by the time this was publicized, Augusta-Westland
had been ruled out of the competition on other grounds. 80 This led to calls for Antony to
rethink the government's policy, with suggestions that the defence ministry should impose
penalties on a foreign company while continuing to accept delivery of orders.
In addition to Antony's sensitivities, the continuing stream of corruption allegations has
slowed down the award of contracts because officials became wary of signing off on large
sensitive orders, fearing similar (true or false) bribe scandals that might erupt, maybe many
years later. That fear reached crisis proportions under Antony, who proverbially tilted at
windmills every time there was a hint of corruption. One solution would be for more con-
tracts to be placed on a government-to-government basis without competitive tendering.
That is sometimes done with Russian orders (though it does not eliminate bribes), and it
has been done for a large proportion of the $11bn defence orders placed in recent years for
US equipment.
Pakistan and China must surely enjoy watching India imposing all this self-inflicted
damage on its war readiness and relish the thought that they themselves could not do much
more harm in a border war. Indeed, an arch conspiracy theorist would suggest that agents