FLYING TOO HIGH - A single person cannot subvert the procurement system
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- Published 14.03.13
A report by prosecutors filed in Italy in connection with the arrest of the chief executive officer of Finmeccanica, Giuseppe Orsi, has alleged that the then Indian air force chief was instrumental in swinging the Indian VVIP helicopter deal and was paid a certain amount of money, not yet quantified, through intermediaries. The report claimed that technical requirements were tweaked by the then air chief to enable the Italian helicopter to qualify and he also named three of his relatives as intermediaries.
Not surprisingly, this news spread like wildfire and the media, especially electronic, went wild. For a few days, the face of the erstwhile chief accompanied every bit of news on the subject. In the eyes of the nation, he was already damned. Like everything else in our volatile political climate, the debate soon took on political overtones and a partisan blame game began.
Without necessarily having to give the chief a clean chit, the ministry of defence did not choose to assure the people unequivocally that our defence procurement systems are robust enough not to be influenced by any one individual, irrespective of rank or status. The lone voice of sanity was that of Jaswant Singh, when he counselled, “We should not make wild allegations against a former Air Chief. It is not in the interest of both the Air Force and the country. The probe is on. Let’s wait.” Having been both a distinguished soldier and a defence and a foreign minister, he understood more than any other the destruction such media hype was causing to the very fabric of our armed forces. Even this wise counsel was soon drowned in political one-upmanship.
It is not this writer’s case to defend the erstwhile chief or his actions in the absence of being in possession of the full facts of the case, which in any case is the subject of an investigation. But having served for nearly a decade in various capacities in the planning and procurement side of the air force headquarters, one can say with some confidence that one individual cannot subvert the procurement system. It can only happen when compromises are made at multiple levels, both military and civil, through patronage, persuasion or pelf or a combination of these.
That there are to be no agents dealing in weapon systems has been the mantra of the defence ministry now for decades, yet their existence must be the worst kept secret in Lutyens’ Delhi. Recent reports have indicated that not only does this faceless tribe exist, but it moves around in high circles and has access to Lutyens’s elite bhawans and social circuits. The unspoken truth is that the system demonizes them in public, but flirts with them in private. If the apex levels of our national security and defence management are either unaware of their existence or unable to defang them, the question that naturally follows is whether national security itself is in secure hands.
The primary charge levelled at the erstwhile air chief is that he conspired to lower the services qualitative requirements of operating altitude enabling the AgustaWestland AW101 helicopter to enter the race from which otherwise it was excluded. The defence minister and the recent MoD release, on the other hand, are on record saying that all laid down procurement procedures were meticulously followed. Taking both these statements to be factually correct, two conclusions emerge. First, that our defence procurement procedures are so devoid of checks and balances that one single individual within the system can distort it, and second, that the MoD has suddenly loosened its suffocating stranglehold on the armed forces, giving the chiefs adequate rope to swing a Rs 3,760 crore deal. As even a novice in the arms business in Delhi will tell you, both conclusions are patently false.
In the midst of this gathering storm, the MoD has issued a press release giving out the sequence of events. It reveals that an acquisition process for VVIP helicopters commenced in March 2002 and culminated in the EC-225 of M/S Eurocopter being found suitable for acquisition after flight evaluation. In November 2003, the principal secretary to the prime minister convened a meeting voicing concern that the mandatory requirements stipulated by the IAF had resulted in a single vendor situation. Ostensibly to widen the choice of prospective vendors, the meeting decided to modify the mandatory altitude requirement to 4.5 kilometres whilst leaving the 6 km altitude to be desirable. It further added 1.8 metre cabin height as a desirable requirement.
The principal secretary then followed this up in December 2003 with a letter to the defence secretary and the chief of the army staff voicing concern that neither the Prime Minister’s Office nor the Special Protection Group had been consulted whilst formulating the SQRs and suggesting that realistic mandatory requirements be drawn up and the acquisition process be put on a fast track. A strange suggestion considering that in the earlier meeting the decision to change these requirements had already been taken!
In the words of the MoD “In pursuance of the above directive, the ORs were deliberated at length between IAF, NSA, SPG/PMO and MoD between March, 2005 to September, 2006 and the above indicated changes were incorporated.” The devil, however, is in the detail, as it is this deliberative process that was ultimately misused to regularize an irregular decision. It would be interesting to know how many within the system stood for professional integrity and probity and those that failed and their compulsions. Clearly one victim was the professionalism that must form the bedrock of the formulation of SQRs.
The MoD release fails to clarify that the professional expertise for aerial transportation of VIPs resides in the Air HQ Communication Squadron and it is part of the SQR process. It is also silent on whether the entire SQR process was revisited as per the procurement procedure or circumvented through this unconventional route.
Some interesting points emerge from this. The primary concern of the principal secretary to the prime minister was a single vendor situation. At the time, the Defence Procurement Procedure 2002 (version June, 2003) was very much in existence although it was to come into force from June 30, 2003. Notwithstanding this, there did exist an earlier policy and the entire process was proceeding under the authority of the defence acquisition council chaired by the defence minister. The DPP recognizes the reality of a single vendor situation arising even at a tender stage and leaves the authority to decide with the defence minister.
It was contrary to the letter and spirit of the procurement procedure for the PMO to have interfered, especially at the crucial decisionmaking stage. The MoD release glosses over this vital violation of procedure, which not only halted the induction process that was nearing completion, but under the guise of the issues of single vendor and revision of SQRs, also paved the way for the AgustaWestland helicopter to join the race. The IAF chief at the time of the PMO’s intervention was the predecessor to the chief under fire, although the formal changes to the SQR took place under the latter’s watch.
The formulation of SQRs is a highly professional and technical process. It involves a deep consultative process under the leadership of the air force HQ and includes prospective users and concerned agencies even outside of the air force HQ. Once evolved, the SQRs are approved by the staff equipment policy committee. Changes, if any, can only be with approval of the defence minister.
In such a situation, an intervention by the principal secretary to the prime minister and the silent acquiescence by the MoD and the air force HQ speaks volumes of the arbitrariness of the way this procurement was handled. Had the PMO addressed its concerns to the defence minister as head of the defence acquisition council and let matters evolve till the proposal came to the cabinet committee on security, it would have acted in keeping with the letter and spirit of the procurement procedure. By stooping to take on the role of changing the SQRs, it acted arbitrarily and in violation of the procedures. If IAF professionals then acted as mere doormats, it is indeed a sad reflection.
The MoD release claims that “the procurement case was progressed in accordance with the established procurement procedure in a transparent manner with all stages of procurement being followed meticulously”. On the contrary, agencies external to the defence procurement process interfered at two crucial junctures. First, to halt procurement of a selected helicopter in the final stages and then to meddle with SQRs to allow the AgustaWestland helicopter to enter the race. By remaining a mute spectator, the MoD and the air force HQ became complicit. The rest is history and the chickens are now coming home to roost.
Now that the Central Bureau of Investigation has initiated a preliminary inquiry and the Rajya Sabha debated the issue and set up a joint parliamentary committee, the choppergate typhoon that hit New Delhi will pass, soon to be forgotten. If past performance is any indicator, the end is predictable. A few reputations and careers of servicemen will be destroyed, the arms agents will move on to the next deal and the real perpetrators and beneficiaries will live to enrich themselves another day, and all that the nation will be left with are the SQRs with their sanctity open to abuse and the morale of the armed forces further eroded.