Defence Ministry asks FIPB to defer clearance for AugustaWestland-Tata Sons joint venture

NEW DELHI: The Defence Ministry has asked the FIPB to defer its decision on a proposal to assemble military and civilian choppers by AgustaWestland, which is facing the prospect of cancellation for its alleged wrongdoings in the VVIP chopper scam.

The Foreign Investment Promotion Board (FIPB) in its meeting on September 19 had approved the proposal of Indian Rotorcraft, which is a joint venture between Tata Sons (74 per cent) and AugustaWestland (26 per cent).

The Ministry is unhappy with the approval given to the Tata-AgustaWestland joint venture to produce and upgrade choppers in the country. A letter has been written in this regard to the FIPB and they have been asked to defer the decision, Government sources said here.

BJP has also attacked the Government on the issue saying, "This company (AgustaWestland) should have been blacklisted and all deals be scrapped till the probe gets over, but the UPA is acting to the contrary. The Tata-AgustaWestland deal not only affects the investigations but legitimises a rogue company."

As per the proposal, the Indian Rotorcraft will assemble AW119Kx helicopters, an upgraded version of AW119Ke chopper. The company expects to commence production from March 2014.

The issue of corruption charges on AugustaWestland's parent company Finmeccanica came up during the FIPB meeting and it was observed that the issue which was being investigated related to helicopter model AW101 and not this proposal.

The board, according to sources, observed in its minutes that "law will take its own course and the current FIPB consideration is without prejudice to any existing or future civil or criminal proceedings against the foreign investor or its parent".

The proposal will now be placed before the Finance Minister for a final nod.