Dateline New Delhi, Tuesday, Mar 21, 2006


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No extra payment for Scorpene: Pranab
by Pankaj Yadav

     New Delhi: Dismissing Opposition allegations of a scam in the Rs 13,500-crore deal for the purchase of six French Scorpene submarines, Defence Minister Pranab Mukherjee today said that the Centre has not paid an extra amount of Rs 4500 crores in the deal with two French firms. Making a suo motu statement in the Lok Sabha, Mukherjee said that the Government achieved a reduction of Rs 313 crores compared with what was negotiated in 2002. "After the present government came to power, it re-examined the project even though all negotiations had been completed in 2002 and the Ministry of Finance had accorded approval to the project in 2003," the Defence Minister added.

    The National Democratic Alliance (NDA) leaders had yesterday charged the Government that middlemen were involved in the submarine deal and demanded termination of the contract and institution of an inquiry. Reacting to the allegations, Mukherjee had said the deal had been negotiated and finalised by the NDA government, adding that after the UPA government took over, the deal had been re-negotiated and reduction of price was to the tune of Rs 313 crore arrived at. He further said that an "integrity pact" was in force and any violation would not only lead to cancellation of contract but also imposition of heavy penalties. Describing the allegations against the deal as "unsubstantiated", Mukherjee said the Government had come out with a comprehensive rejoinder on February 15.

    The Indian Government's decision last October to sign a contract with the French company Thales for the procurement of six Scorpene submarines for the Indian Navy at a whooping 18,798 crore rupees along with a tax component of Rs 3,553 crore, is said to be the biggest ever single arms purchase contract undertaken by New Delhi. However, the deal that took four years to materialise did not take even four months to run into controversy as the "Outlook" magazine came up with an allegation that four percent of the deal amount was paid as kickback to the middlemen involved in the deal by the French company. To substantiated the allegation the magazine quoted an e-mail from Thales' top executive Jean-Paul Perrier to the alleged middleman Abhishek Verma that read ''We confirm the payment of four percent of the Scorpene contract price". Though Perrier has stated that the e-mail is forged, he has not denied having any contact with Verma. The Navy's war room leak case is the offshoot of the alleged irregularities exposed through the Scorpene deal. The Navy had constituted a board of enquiry after intelligence officers had recovered a pen drive from a senior Air Force officer Wing Commander S.L. Surve in December, which contained classified Naval information. The officer was on deputation with the Directorate of Naval operations. However, three Navy officers were summarily dismissed in October in the 'War Room Leak'. But rather than being court-martialled, they were sacked. Significantly no interrogation was carried out of a close relative of the serving Navy chief Admiral Arun Prakash who is said to be linked to Abhishek Verma who is also the alleged recipient of the leaked information which included details of the submarine deal. The UPA Government has dismissed the allegations levelled by the magazine as full of discrepancies.

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