India’s defence ministry said on Monday it had ordered a bribery investigation over state-run Hindustan Aeronautics Limited‘s (HAL) purchase of jet engines from Britain’s Rolls-Royce Holdings (RR.L) in a deal worth at least $1.2 billion.
Hindustan Aeronautics Limited (Photo credit: Wikipedia)
The Central Bureau of Investigation, the country’s top crime-fighting agency, will look into more than 5 billion rupees ($80 million) in alleged kickbacks in the deal that was signed in 2011, a ministry official told Reuters.
No comment was immediately available from Rolls-Royce’s office in India.
Suspicions of corruption in India’s defense procurement program have for years delayed the modernization of the armed forces of the world’s most populous nation that continue to rely heavily on outdated Soviet-designed equipment.
The air force has been dogged by a series of crashes of its Russian-built MiG fighter jets, while an accident aboard a Soviet-made submarine that killed two officers last week led the navy’s chief of staff to resign.
India’s Congress party-led government is keen to be seen as tough on graft before parliamentary elections due by May. The party, lagging in the polls, has faced rising public anger over a string of corruption scandals in its current term.
The probe into the HAL deal follows the arrest in Britain last month of Indian-born businessman Sudhir Choudhrie and his son in a bribery investigation by the Serious Fraud Office into Rolls-Royce’s dealings in China and Indonesia.
Both men denied any wrongdoing and have been released on bail, their spokesman said last month.
via India to investigate suspected kickbacks in Rolls-Royce deal | Reuters.
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