NEW DELHI — India has quietly lifted a ban on
Israeli Military Industries (IMI), paving the way for negotiating new
defense projects with the Israeli company, a Defence Ministry source
said. The MoD has not publicly announced the lifting of the ban,
imposed in 2009, but communicated its decision to IMI in September, the
source said.
No Indian MoD official would confirm the lifting of
the ban, nor would any diplomat of the Israeli Embassy comment. IMI
officials in Israel declined to comment on the report.
The former
Indian United Progressive Alliance government imposed the ban after
alleged corruption charges, but India’s anti-fraud agency, the Central
Bureau of Investigation (CBI), could not prove the charges against IMI,
the source added. IMI was accused of bribing officials from the
government-owned Ordnance Factory Board (OFB) to win a deal for
producing 155mm ammunition at OFB’s Nalanda factory.
With the ban
removed, the MoD intends to explore new defense projects with the
Israeli company, the MoD source said. These could include partnership in
the design and development of the proposed homemade future main battle
tank and setting up a facility to jointly manufacture a variety of
ammunition, especially for 155mm guns, the MoD source said.
IMI had been a frontrunner in the tank design project.
Amid
charges of alleged corruption, MoD canceled the $350 million tender IMI
had won to manufacture a bi-modular charge system for 155mm guns to be
built by the OFB.
However, the blacklisting of IMI led to a
shortage of ammunition for the 155mm guns. Retired Gen. V.K. Singh,
former Indian Army chief and now minister of state for external affairs
in the Narendra Modi government, informed former Defence Minister A.K.
Antony in a letter of “critical shortages” of a variety of ammunition.
The
OFB is not able to meet all the Army’s ammunition requirements, and
India is dependent on Russia to supply many kinds of ammunition.
In
addition to IMI, in 2009 India blacklisted Singapore Technologies,
Rheinmetall Air Defense and Corporation Defence of Russia on charges of
corruption.
In August, the Modi government lifted a ban on Denel
after India’s CBI failed to prove charges of corruption against the
South African company, nine years after the ban was imposed in 2005.
Denel was accused of paying kickbacks to secure a deal with the Indian
Army in 2002 to supply 1,000 anti-material rifles and ammunition.
The
blacklisting of Denel stalled several Army projects, including the
purchase of 155mm/52-caliber artillery guns as Denel was the front
runner in the program, which was canceled immediately after the
blacklisting in 2005.
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