Friday, June 5, 2009

Defence ministry blacklists seven companies

India has blacklisted seven defence companies, including Israeli Military Industries and three Indian companies, figuring in a corruption case filed by the Central Bureau of Investigation and has "put on hold" all the deals with them.

"Taking a tough stand against corruption, Defence Minister A.K. Antony has directed all acquisition cases in the pipeline in respect of the seven companies figuring the CBI FIR (First Information Report) to be put on hold till further orders," defence ministry principal spokesperson Sitanshu Kar said Friday.

The blacklisted companies are Israeli Military Industries, Singapore Technology, BVT Poland and Media Architects Pvt. Ltd of Singapore and three Indian companies: T.S. Kishan and Co. Pvt. Ltd., R.K. Machine Tools and HYT Engineering Co.

Following the defence ministry's order the Rs.12 billion ($240 million) deal between Israel Military Industries Ltd. and the Indian Ordnance Factory Board (OFB) on March 25 has been put on hold. Under the deal a munition factory was to be built at Nalanda in Bihar along the lines of IMI's ordnance factory in the Tel Aviv suburb of Ramat Hasharon.

CBI had registered a case against the former OFB director general Sudipto Ghosh in Kolkata on May 17 under the Prevention of Corruption Act. The seven companies were mentioned in the FIR.

"Although no chargesheet has yet been filed by the CBI, concrete evidence such as transfer of money to personal accounts has been found. The government views both recieving and giving bribes as an offence and as such there cannot be any lenient view on this account," Kar pointed out.

"The matter will be further reviewed as and when the CBI provides more evidence. The defence ministry desires to tackle the issue of corruption in procurements cases head on," he added.

All procurements and acquisitions from the blacklisted companies will be suspended "forthwith" and "alternative sources" will be looked at for essential items, Kar said.

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