The Defence Ministry deviated from the laid down procedures for the purchase of 12 VVIP helicopters from Italian firm, Agusta Westland, worth Rs 3,727 crore, the Government auditor said.
Questioning the decision of the Indian Air Force chief in 2007, the Comptroller and Auditor General (CAG), in its report tabled in Parliament on Tuesday, said the benchmarked cost of Rs 4,871.5 crore for the helicopters was unreasonably high (22.80 per cent more) than the offered cost of Rs 3,966 crore.
It said the Ministry’s reply was “not acceptable” as the offered price was more than six times the estimated cost of Rs 793 crore, “which indicates that Air HQ has not prepared proper estimates of the requirement….
Elaborating further on deviation of norms, the CAG report said the initial request for proposal (RFP) issued in March 2002 for replacement of Mi-8 copters stipulated a mandatory altitude requirement of 6,000 metre. “The EH-101 (later named Agusta Westalnd-101) could not be field evaluated as it was certified to fly up to an altitude of 4,572 metre only.
The first RFP was cancelled due to a single-vendor situation, and in the revised RFP issued in 2006, the altitude requirement was reduced to 4,500 metres. Also, for the first time, a requirement of cabin height of at least 1.8 metre was introduced, which further “reduced competition”.
According to the CAG report, “…the lowering of altitude requirement was against the inescapable operational requirement of 6,000 metre for transportation to many areas in North and North East.”
The report also flayed the Ministry for the inordinate delay of over 10 years in finalising the acquisition process, which led to the IAF facing an operational disadvantage as it had to keep using ageing helicopters.
It also questioned the need for conducting field trials of the copters outside the country in spite of the fact that Defence Ministry had rejected the proposal twice.
Both Indian and Italy are probing the 2010 VVIP copter deal, after allegations that AgustaWestland paid bribes to win the contract from the Indian Defence Ministry.