AFP, NEW DELHI: An accounting “oversight” could result in a multi-billion-dollar plan by India to purchase 66 Hawk Advanced Jet Trainers from British Aerospace falling apart, a report said Wednesday.
Last September, the Indian cabinet gave the green light to the Indian Air Force to purchase 66 Hawk Advanced Jet Trainers (AJTs) from British Aerospace (BAe) for 1.63 billion dollars.
But the Times of India Wednesday said “a new controversy” over tooling costs which were not put before cabinet for clearance was jeopardising the deal.
BAe has said if the contract, as cleared in September, is not finalised this week, it will not hold to the agreed prices and the deal would have to be renegotiated, the newspaper said.
India's defence ministry declined to comment on the report, although government officials told AFP BAe executives were meeting defence secretary Ajay Prasad “to talk things through” in connection with the deal.
The newspaper said India's state-run Hindustan Aeronautics Ltd (HAL) made “an oversight” in not accounting for the bill the government would have to pay for tooling its factory to assemble the British jets in southern Bangalore city.
“The assumption was that with its vast army of design specialists, HAL would do the job in-house with the design and technical drawings obtained from British Aerospace,” said the Times of India.
“Now a new controversy has erupted over what one party terms an oversight on HAL's part in not including the charge for manhours of design work in tooling to manufacture the Hawk,” said the paper.
“The charge could vary from 15 to 50 million dollars,” it added.
The newspaper said the tooling costs were omitted from the proposal put before cabinet last September. It said the omission occurred because of an “unduly long time” lag between March 2002 when India's Price Negotiating Committee (PNC) finalised the deal and the cabinet meeting to clear the plan.
“Some of the key officials involved in the contract work retired in the 18 months it took between the PNC and cabinet approval and were replaced by new incumbents who did not spot the mistake,” The Times of India said.
BAe had pegged 66 AJTs at a package price of 1.63 billion dollars when India first sought the planes two decades ago but the rupee has since slid steadily against the greenback.
