If bribes were paid, Israel arms deal will be scrapped: Antony

Defence minister AK Antony said on Friday that the government could cancel the Rs10,000 crore medium-range surface-to-air (MRSAM) deal with Israel Aerospace Industries (IAI) if allegations of kickbacks are proved.

But he kept mum on key questions raised by DNA’s investigation, including why no open tender was floated to procure the missiles. He also claimed ignorance that a retired air force officer was working for the Israeli firm in New Delhi.

DNA, in a series of investigative reports, has exposed how the United Progressive Alliance (UPA) government went ahead with the deal on the eve of the general election though legal opinion didn’t conclusively favour the contract.

The government also agreed to pay “6% business charges”, which work out to Rs600 crore. In his first public statement after the exposé, Antony told reporters in Thiruvananthapuram that Indian missiles were archaic and outdated and MRSAM deal was in the national interest and transparent.

But if the “IAI violates the pact or they are found to have bribed anyone or any such malpractice comes to fore”, the defence ministry can “cancel the agreement” and initiate “criminal proceedings” against the company, he said.

“We can demand a refund and blacklist the company for five years,” the minister said.
Antony said the government was cautious when it signed the deal.

Our missiles are archaic, says Antony

Defence minister AK Antony said on Friday that the government would cancel the MRSAM deal with Israel Aerospace Industries if it was found to have paid bribes.
On why the Rs10,000 crore deal was approved without favourable legal opinion, he said: “There is a CBI probe on (against IAI) in the Barak missile deal. The UPA government was very cautious when the proposal for MRSAM came up. We consulted the law department and got the go-ahead. The weapons were essential for us.”

Asked why the deal was cleared hardly a week before the elections to the 15th Lok Sabha were announced, Antony said: “The Indian Air Force had come up with the proposal in 2002. Our missiles are archaic and outdated. Nations opposed to us have sophisticated weapons. The ministry of defence, air force, and the Defence Research & Development Organisation (DRDO) representatives had held elaborate discussions on it and the final approval was given in December 2008.” The government had also signed an integrity pact with the Israeli firm, he said.

Asked if the deal meant the end of the road for indigenous missiles of the same class, he said: “They are the babies of DRDO. The MRSAM is also going to be developed by DRDO in association with IAI. They know what’s best for the country.”

But he refused to comment on the lack of an open tender for the MRSAM deal.
Asked if it was proper for a former IAF officer who held a crucial post to work for an Israeli defence firm in Delhi, he said: “I don’t know. Since you asked, I will inquire about it. But there are a lot of government servants and defence personnel who seek private employment after retirement.”