India does not believe AgustaWestland bribery denial

NEW DELHI Wed Feb 27, 2013 8:33pm IST

The headquarters of Italian defence and aerospace company Finmeccanica is seen in Rome May 3, 2012. REUTERS/Max Rossi

The headquarters of Italian defence and aerospace company Finmeccanica is seen in Rome May 3, 2012.

Credit: Reuters/Max Rossi

Related Topics

Stocks

   

NEW DELHI (Reuters) - Defence Minister A.K. Antony said he did not believe AgustaWestland's denial that it paid bribes in a $750 million helicopter deal, but would wait for an inquiry before deciding on action that could see the order cancelled.

A.K. Antony said the company had responded to a show cause notice demanding it explain accusations by Italian prosecutors that millions of euros in kickbacks were paid to clinch the deal for a dozen luxury helicopters.

India has frozen payments for the helicopters pending an inquiry by the country's Central Bureau of Investigation (CBI) and has said it is seeking to cancel the deal.

"They have denied the whole thing. We don't believe it," Antony said during a rowdy parliamentary debate in which he came under opposition fire for not investigating the allegations of corruption earlier.

He did not explain why he did not accept the denial.

Earlier this month, Italy arrested Giuseppe Orsi, the head of Finmeccanica (SIFI.MI), the parent company of AgustaWestland, on accusations he organized bribe paying. Orsi, now in custody, has since resigned.

"We are waiting for the CBI," Antony said, reiterating that under an integrity pact signed by the company, India had the right to cancel the contract and pay no compensation if bribery were proved.

In recent years, India has emerged as the world's largest weapons importer, but procurements are periodically held up by allegations of corruption. Finmeccanica could be blacklisted in India for at least five years if investigators prove bribery.

Finmeccanica and AgustaWestland both declined to comment. Finmeccanica shares were largely unmoved after Antony's comments, up 0.2 percent at 3.7 euros at 1501 GMT.

The defence minister, nicknamed St. Antony for his squeaky-clean image, asked the CBI to investigate the allegations for the first time earlier this month, despite the fact that they first surfaced a year ago.

Opposition leader Arun Jaitley questioned Antony's argument that the government had not acted sooner because Italy had refused to share details of its investigation, saying the minister was "passing the buck."

"Italians have done their job by arresting the bribe giver, you have not done the job to arrest the bribe taker." (Reporting by Satarupa Bhattacharjya; Writing by Frank Jack Daniel; Editing by Helen Massy-Beresford)

FILED UNDER:
Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.

  • Most Popular
  • Most Shared

REUTERS SHOWCASE

Photo

RBI Policy Review

RBI keeps rates on hold, warns on inflation  Full Article 

China iPhone Sale

China iPhone Sale

China regulator approves Apple's iPhone 6 for sale in China  Full Article 

Cleanliness Drive

Cleanliness Drive

Modi orders officials to clean loos on Gandhi's birthday.  Full Article 

Jaitley's Health

Jaitley's Health

Finance Minister Jaitley in isolation ward, may skip U.S. trip.  Full Article 

China Factory

China Factory

China final HSBC PMI steady in September on stronger global demand but risks remain  Full Article 

Vadodara Violence

Vadodara Violence

Police arrest 140 for religious clashes in Vadodara as Modi tours U.S.  Full Article 

Japan Economy

Japan Economy

Economy takes another hit as spending, factory output fall  Full Article 

AIG Bailout

AIG Bailout

Six years after AIG bailout, trial asks: was it legal?  Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device.  Full Coverage