After suspending the Switzerland based firm for a year for major defense scandal just months ago, the Defense Ministry now lifts partial ban on Swiss Pilatus. Top IAF officials are believed to be under scanner for this aircraft deal. The new development come days after field-test failed Israeli Spike missiles were inducted into Indian Army.
Defense Ministry lifts Ban on Swiss Pilatus
In July, the Defence Ministry had suspended business dealings with Pilatus of Switzerland for a year, over allegations of corruption in the supply of Basic Trainer Aircraft (BTA) for the Indian Air Force (IAF). However, it has come to light that Indian MoD has partially lifted its one-year prohibition on doing business with Pilatus.
Under the 7 October announcement, the Indian Air Force (IAF) will now access spare parts and maintenance support for its fleet of 75 Pilatus PC-7 Mk II tandem-seat basic trainer aircraft, which were ordered for about USD1 billion in 2012 to replace Deepak HPT‐32s. The contract included offset obligations.
However, there are several provisos: the IAF must obtain a ‘mean time between failures’-linked warranty from Pilatus in the next three or four months and make headway on the follow-on support contract for the PC-7 fleet, reported Jane’s Defence Weekly.
Why Swiss Pilatus was Suspended for a year
Earlier in July, the Defense Ministry had severed business dealings with Swiss Pilatus stating,
“Business dealings with the firm will remain suspended for a period of one year for violation of article 6.6 of the Pre Contract Integrity Pact (PCIP) and ongoing investigation by the CBI, Delhi Police, Enforcement Directorate (ED) and Income Tax department into corrupt practices, unfair means and illegal activities by Pilatus Aircraft Limited.”
IAF operates 75 PC-7 MKII trainer aircraft procured under a $532 million deal with Pilatus in 2012. The Defence Ministry issued a show cause notice to the company in January 2017 following allegations of corruption, after which Pilatus admitted having engaged the services of Offsets India Solutions (OIS), owned by fugitive arms dealer Sanjay Bhandari, and paying it at least 1 million Swiss francs in 2010 in connection with the trainer deal.
Top Air Force Officials under scanner
Top Air Force officials including former Chief of Air Staff is also said to be under scanner. The Swiss firm Pilatus entered into criminal conspiracy with Sanjay Bhandari and Bimal Sareen, Directors of Offset India Solutions and fraudulently signed Service Provider Agreement in violation of Defence Procurement Procedure for which CHF 10 lakhs were paid by Pilatus.
Swiss firm Pilatus entered into criminal conspiracy with Sanjay Bhandari & Bimal Sareen, Directors of Offset India Solutions and fradulently signed Service Provider Agreement in violation of Defence Procurement Procedure for which CHF 10 lakhs were paid by Pilatus. pic.twitter.com/qegbKhNuXo
— GreatGameIndia (@GreatGameIndia) June 22, 2019
Pilatus also fraudulently signed a Pre Contract Integrity Pact with Ministry of Defence. It is suspected that the commission amount of INR 339 crore was paid to Bhandari to influence IAF, MoD and GoI officials associates with the deal.
As per Top Secret note from the Home Ministry, “during the past, L.K. Advani and Robert Vadra visited his residence. Sanjay also boasts of his closeness with Shiela Dikshit, CM Delhi, and claims that he had been talking to her over the telephone once or twice every week positively”.
Criminal Investigation in Switzerland
Pilatus is also under scrutiny at home. Switzerland’s office of the attorney general has opened a criminal investigation in connection with the sale of military training aircraft to Saudi Arabia and the United Arab Emirates.