The Telegraph
Since 1st March, 1999
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Submarine deal in choppy waters

New Delhi, March 20: The Union government last week put off at the last minute a crucial meeting that was billed to clinch a $1.8-billion deal to acquire French Scorpene submarines amid indications that a German manufacturer cleared of bribery charges will now bid for the programme much to the chagrin of the navy.

Naval headquarters is worried that its fleet ' particularly the submarine strike arm ' was de-commissioning vessels faster than it can acquire them.

The worry has also prompted naval headquarters to revive a discussion with the US Navy to rescue Indian submarines in distress. India is ready to pay for such service.

'We have waited long, too long actually,' the chief of naval staff, Admiral Arun Prakash, told The Telegraph on Friday when asked about the proposal to acquire the Scorpene submarines.

'It (the proposal) is in its very last stages. It has been there for some time,' the admiral said shortly before leaving for the US where he will discuss the submarine rescue agreement with the US Navy and also the possible acquisition of spy planes.

Asked if he expected a decision on acquiring the Scorpene submarines within the current financial year, he said: 'That is not up to me. I cannot say. It is up to the government'. The financial year ends on March 31.

The cabinet committee on security was to meet on Friday to discuss the proposal on Scorpene submarines that was cleared by naval headquarters nearly a year back.

India has been in negotiations with the French to acquire and jointly develop at the Mazagaon docks six 1,500-tonne Scorpene submarines.

For a year now, the defence ministry has been saying that it was close to clinching the deal estimated at Rs 12,500 crore.

The deferment of a decision on the Scorpene programme comes close on the heels of German company Howaldtshwerke Deutsche Werft (HDW) being cleared of charges by a Delhi court that it had ploughed back money to secure an order in the early 1990s for EKM class submarines that are with the Indian Navy.

In an immediate statement after being cleared of the charges, HDW said it was 'now cleared to re-establish its good relations with the Indian Navy along with partner MAN Ferrostal Aktiengesellschaft to follow up the Indian Navy's modernisation programme'.

Last year, as the defence ministry headed by George Fernandes claimed that it was close to signing the Scorpene deal, Congress Rajya Sabha MP and former external affairs minister Eduardo Faleiro alleged that the ministry was signing up with the French at the cost of the indigenous submarine development programme at the Mazagaon docks in Mumbai.

The navy had acquired the design for this three-year programme from HDW.

The Indian Navy's submarine fleet is of Russian and German origin.

The navy chief has set the replenishment of the navy's sword arm as one of his immediate objectives because the fleet was de-commissioning ships and submarines faster than it could acquire them.

Admiral Prakash said that during his visit to the US, he would be discussing the acquisition of the P3C Orion maritime surveillance aircraft and an agreement with the US Navy to rescue Indian submarines in distress.

'The submarine rescue agreement envisages that the US Navy will help us out in times of need on payment,' he said.

'The P3C Orion programme is outstanding. We are definitely interested. The offer is there but procurement is a long process.'

Lockheed Martin, the makers of the P3C Orion spy plane, and defence public sector Hindustan Aeronautics Limited signed a technical assistance agreement in February after it was cleared by the US state department.

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