India has barred six defense companies, including Israel Military Industries Ltd. (IMI) from bidding for defense contracts for ten years, on suspicion of involvement in a major corruption scandal involving former director general of the Ordnance Factory Board Sudipta Ghosh.
In addition to IMI, India's Ministry of Defense barred Singapore Technologies Kinetics Ltd., Switzerland's Rheinmetall Air Defense AG, Corporation Defense, Russia (CDR), and two Indian companies TS Kisan and Co. Pvt. Ltd. and RK Machine Tools Ltd.
The indictment filed against Ghosh in June 2010 states that he was a party to a wide-ranging conspiracy, including the receiving of bribes from defense contractors in exchange for favoring them in defense tenders. The Ministry of Defense froze all contracts signed with the six companies in May 2009, when the scandal came to light.
According to the "Times of India" and the "Hindustan Times", IMI and India's Ordnance Factory Board were jointly setting up five factories for the manufacture of fuses for Bofor howitzer shells in Bihar’s Nalanda district. The multimillion dollar project has been on hold ever since the IMI's name cropped up in the Ghosh scandal.
The Ministry of Defense spokesman said, "The firms were recommended for blacklisting by the Criminal Investigation Bureau. They were issued as show cause notices to explain why action should not be taken against them consequent to the filing of the charge sheet in the case related to illegal gratification against Sudipta Ghosh." The ministry barred the companies after finding their responses unsatisfactory to its requests for explanations.
Published by Globes [online], Israel business news - www.globes-online.com - on March 6, 2012
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