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Modi govt not to buy Pilatus trainer aircraft following corruption charges, to ban Swiss defence firm for one year

The CBI also alleged that the Swiss company deposited a million Swiss francs in the account of Offset India Solution Private Limited in two tranches in 2010.

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OpIndia Staff
Staff reporter at OpIndia

The Ministry of Defence has decided to drop its plans to buy 38 more Pilatus PC-7 MkII trainer aircraft from Switzerland after Central Bureau of Investigation (CBI) accused the Swiss company of being involved in corrupt practices to bag the Rs 2,800 crore deal in 2012, reports ANI.

Reportedly, Pilatus, which supplies trainer aircraft to the Indian Airforce, has been banned for at least one year by the defence ministry. The Defence Ministry has also launched a fresh global hunt for basic trainers. The development is likely to cause a delay in the procurement of basic trainer aircraft into the IAF.

“The government has conveyed to the IAF that it should not pursue the follow-on option, keeping the CBI probe in mind. There is likely to be a government-to-government deal for more basic trainers as it is a critical need,” said an official according to the Hindustan Times.

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Last month, the Central Bureau of Investigation had registered an FIR against notorious arms dealer Sanjay Bhandari, unknown officials in the Indian Air Force and Swiss aircraft maker Pilatus over alleged irregularities and corruption to the tunes of 339 crores. The kickback amount was allegedly given during the procurement of 75 basic trainer aircraft for the IAF in 2009 in an Rs.2,800 crore deal.

The CBI has alleged that Pilatus Aircraft Limited entered into a criminal conspiracy with Bhandari and Bimal Sareen, both directors of Offset India Solutions Private Limited, and dishonestly signed a service provider agreement with Bhandari in June 2010.

The CBI also alleged that the Swiss company deposited a million Swiss francs in the account of Offset India Solution Private Limited in two tranches in 2010.

Pilatus had allegedly transferred 350 crores in Swiss francs to the bank accounts of Dubai-based Offset India Solutions FZC, also a Bhandari company, during 2011-2015. Pilatus also signed a pre-contract integrity pact with the defence ministry in November 2010, deliberately concealing the facts about service provider agreement with Bhandari.

The Pilatus deal controversy began when Korea Aerospace Industries, the closest rival to the Pilatus, had strongly protested against the UPA government deal claiming that Pilatus had submitted an incomplete bid and demanded its disqualification. South Korea’s defence minister had personally contacted A.K. Antony, his Indian counterpart, requesting a “high-level review”. However, these objections were overruled and Pilatus was awarded the contract.

The Indian Airforce trainee pilots undergo a three-stage training programme involving a beginner, intermediate and an advanced training program. Pilatus PC-7 is IAF’s primary trainer along with HAL HPT-32 Deepak. The HAL built HJT-16 Kiran is used in the intermediate training stage and finally, IAF pilots fly British built Hawks advanced jet trainers before they can fly fighter jets.

As Kiran trainers are approaching the end of their service life, some amount of stage 2 training is being done on the PC-7, an official said. He added that the delay in the indigenous Sitara intermediate jet trainer (IJT) programme, conceived two decades ago, has also upset the IAF’s calculations.

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