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CBI to continue probe into VIP chopper deal even as Finmeccanica settles with Italy govt

New Delhi, July 30(Reuters): The Central Bureau of Investigation said Wednesday it would press ahead with its investigation into a scrapped helicopter contract with Finmeccanica, a day after prosecutors in Italy agreed to settle legal proceedings against the defence group.

India cancelled the 560 million euro ($751 million) order with Finmeccanica's unit AgustaWestland for 12 top-end helicopters in January, after bribe-taking was alleged by Italian prosecutors.

Kanchan Prasad, a spokeswoman for CBI, told Reuters the development in Italy did not affect India's probe of the deal.

“Why should it change?” she said. The investigation was “at an advanced stage, that's all that I can say”.

The CBI is investigating allegations of abuse of official power and following money trails from abroad, but charges have not yet been filed, said Prasad.

Finmeccanica said on Tuesday prosecutors had halted investigations into the contract and AgustaWestland would apply to the court for a nominal fine to settle proceedings.

Finmeccanica, one of Italy's biggest private employers, said in the statement: “This decision is not in any way an admission of any wrongdoing or liability”.

The case dented Finmeccanica's reputation and put its helicopter unit AgustaWestland at risk of being blacklisted from India, one of the world's fastest-growing defence markets. The New Delhi government was also embarrassed by the scandal.

India, where a number of defence deals have been hit by corruption allegations over the past two decades, took delivery of three of the helicopters before the deal stalled.