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:
  • Most Popular
  • Most Shared

Market Eye

REUTERS SHOWCASE

Intel's Valuation

Intel's Valuation

Intel could rise 30 percent over next two years - Barron's.  Full Article 

Canonisation

Canonisation

Pope declares sainthood of two Indians, four Italians.  Full Article 

Stake Sale Strike

Stake Sale Strike

Coal India trade unions call off strike in victory for Modi.  Full Article 

Interview with Bulgari CEO

Interview: Bulgari CEO

Bulgari CEO: we shouldn’t have left India so we’re back.  Full Article 

Formula One

Formula One

Hamilton takes second F1 title in style.  Full Article 

Available For Remake

Available For Remake

Bollywood finally wants to pay the price for remakes.  Full Article 

Davis Cup

Davis Cup

Vintage Federer seals first Davis Cup for Switzerland.  Full Article 

Reuters India Mobile

Reuters India Mobile

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