Alarm after defence PSU sells explosives to banned German Company

Alarm bells have rung after a state-owned defence public sector unit sold and delivered close to 500 tons of explosives to a German company, Rheinmetall, which has been debarred from business on corruption charges since 2012. The deliveries took place late last year and early 2024, with a final shipment believed to have been stopped after the matter was brought to notice within the government.

The Indian company, Munitions India Limited (MIL) has had a bonanza of orders from the international market for the past two years as the global demand for explosives has peaked since the Russia-Ukraine conflict. The company has a fully booked production capacity with multiple nations lining up to place orders.



As per records seen by ET, the deal to sell explosives was struck through an intermediary and the first shipment of 144 tons was sent in October 2023. The supply was made to a Spanish company named Expal, which had already been acquired by Rheinmetall as per public records. Two additional shipments were sent, with the final one dispatched in March 2024.


Sources said that while the original contract for delivery was to Expal, the company changed ownership to Rheinmetall and this was not informed to higher authorities. A detailed questionnaire sent to MIL and the defence ministry was not responded to.