Article Posted on : - Aug 29, 2014

CH-47F Chinook. A Boeing photo

NEW DELHI (PTI): Government is likely to discuss the issue of engagement of agents by foreign firms in defence deals against the backdrop of alleged involvement of middlemen in a recent scam where commissions were paid to them in deals worth over Rs 10,000 crore.

The issue is likely to be discussed by the Defence Acquisition Council headed by Defence Minister Arun Jaitley in its meeting on Friday where acquisition cases worth over Rs 20,000 crore are planned to be taken up, Ministry sources said.

The meeting is likely to discuss the role of agents in the Defence Procurement Procedure, 2013, which guides the procurement process of the armed forces.

Under the DPP, the Ministry has clarified to the foreign vendors to confirm and declare that they have "not engaged any individual or firm, whether Indian or foreign whatsoever, to intercede, facilitate or in any way to recommend to the Government of India or any of its functionaries, whether officially or unofficially, to the award of the contract to them."

It also asks the vendors to confirm that "no amount has been paid, promised or intended to be paid to any such individual or firm in respect of any such intercession, facilitation or recommendation."

The DPP stipulates that if any wrongdoing is observed, the vendor would be "liable to refund that amount to the government and the vendor will also be debarred from entering into any supply contract with the Government of India for a minimum period of five years."

The DAC is also scheduled to discuss the Rs 7,000 crore Arjun MK-II procurement case of Army along with the deviation in offsets for a US firm selling the Apache and Chinook helicopters to the Air Force at a cost of over Rs 12,000 crore.