The Defence Ministry has put the Mazagon Dock-Pipavav deal on hold.

On Monday, Mr A.K. Antony, Defence Minister, informed a consultative committee, which is attached to the Ministry, of the decision to put the deal on hold, said a release from the ministry.

Mr Antony told the committee that the joint venture of Mazagon Dock Ltd (MDL) would be put on hold till a policy on joint ventures is put in place by the Government.

“The Ministry would study the complaints received from some private shipyards regarding the joint venture. The issue needs to be fully examined and settled before any forward movement takes place on this front. The joint ventures must compete for contracts and should not get them on a nomination basis. We are treading on a new path and we would like to ensure that transparency is maintained at all levels,” he added.

MDL issued an expression of interest in March 2011 seeking strategic partnership with Indian private sector shipyards to meet the timelines for liquidating its order book of Rs 1 lakh crore.

Based on responses, L&T, Bharati, ABG and Pipavav yards were shortlisted by the public sector undertaking. This was followed by presentations by the shipyards and site visits by MDL officials to evaluate their strengths and capabilities.

On August 23, the four yards made individual presentations to the Mazagon Board proposing their business plans and joint collaborative strategies. Subsequently, they received a letter dated August 25 from MDL seeking details of the joint venture and business plan proposed by them.

On September 12, Pipavav Shipyard announced that the MDL Board had met and selected the yard as its joint venture partner to make warships for the nation.

This apparently caught other three bidders in the fray by surprise. They sent individual representations to MDL and Defence Ministry alleging “total lack of transparency' in finalising the deal, while also pointing out that the decision had been taken without waiting for their detailed submissions.

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