Exclusive: Ukraine-Russia spat hits IAF, mega transport deal hits roadblock

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New Delhi, Sept 5-The Ukraine-Russia conflict may be a distant one but in the event, it was not distant enough to ensure that the Indian Air Force (IAF) emerged unscathed from it.

Defence Ministry’s deal to replace IAF’s 56 ageing HS748 AVRO transport jets has been extended by eight weeks, a decision taken in the last week of August. This despite the Defence Minister Arun Jaitley clearing the deal in his first apex-level Defence Acquisition Council (DAC) meet held on July 19. According to those in the MoD, the deal met with a poor response with only two foreign manufacturers also known as Original Equipment Manufacturers (OEMs) turning up on August 28, the last date of submission of proposals. Of the two, the Ukrainian firm Antonov sought more time. This is fourth extension given to the project.

“We understand it to be on account of the conflict there and domestic reasons cited,” said an officer. This left the defence ministry without an option as rejecting Antonov’s demand would have meant that only one vendor was left in the race, making it an unfavourable proposition. When checked with the Ukrainian embassy, an officer who did not wish to be quoted said, “We are not the only one to have asked for more time.” Representatives of the Airbus group, the other competitor, responded to a query on their status and said they were ready and had not sought any extension from the MoD.

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Interestingly, last November, the Confederation of Indian Industry (CII) had written to the then Defence Minister AK Antony claiming that the private industry in the country, which had to partner the foreign OEMs, ‘had readied their positions’ and warned against stalemate. Representatives of the Airbus group responded to a query on their status and said they were ready and had not sought any extension from the MoD.

Despite repeated efforts, the IAF spokesperson confirmed the extension without assigning any cause or providing further details. “The submission of the proposals has been extended by a further eight weeks. This has been done keeping in mind the request received from the vendors.”

Former Financial Advisor Acquistions in the MoD, Amit Cowshish said, “This being a first of its kind deal, there were imponderables to begin with. But that stage has long been completed. We can’t keep delaying it indefinitely and so the next time there is a request from vendors, the MoD need not agree.” He agreed that there were certain ‘issues’ that the industry had flagged to the MoD about the deal.

-INDIA TODAY