Parrikar Scraps Single Vendor Rifles Deal Over Corruption Allegations; Seeks A Multi Vendor Process

Defence Minister Manohar Parrikar on Wednesday scrapped a tender for procuring 45,000 rifles for the Indian Army at the cost of Rs 1,000 crore amid serious allegations of corruption in the acquisition process. These rifles were to be provided to the counter-terrorism units of the army for the elimination of infiltrators at a close range.

The matter was under investigation over the possibility of favours being given to Israeli firm, Israeli Weapons Industry (IWI), over its other rivals in the deal.

“The tender has been scrapped after deliberations with all stakeholders and legal advice. The army has been asked to restart the process to buy the guns," a senior Defence Ministry official told UK's Mail Today. "The process for acquiring the guns may have been affected but there will be zero tolerance for corruption," the official added.

The initial tender for 44,600 close quarter carbines (rifles) was issued by the Indian Army in 2010. Rifles from two different vendors, IWI and Italian Beretta, were selected for field trials. Beretta’s ARX160 model was rejected by Directorate General of Quality Assurance because a safety measure on its laser sight was found unsuitable. While 28 companies had shown interest in the tender in the first stage, Israeli firm was the only vendor left as in final phase. The Defence Ministry, when necessary, allows single vendor cases to be pursued, but it usually prefers only multi-vendor tenders at the final stage to benefit from competition in cost negotiations.

The irregularities in the procurement process were brought to notice by Union Minister Rao Inderjit Singh during the Defence Acquisition Council meeting in June. According to sources, the Defence Ministry has now asked the army to restart the tender process under a fast-track, multi-vendor model.