India, Italy race to nail helicopter fraud case

Paolo Biondi Rome

Senior management at Italy’s state-owned defence group Finmeccanica have met Indian officials who are looking into allegations of corruption connected with New Delhi’s purchase of a dozen helicopters.

The meeting was “positive” and would be discussed by Finmeccanica’s board later in the day, the company’s new chief executive, Alessandro Pansa, said yesterday.

The Indian delegation is in Italy to collect evidence on the case, which centres on allegations that Finmeccanica paid bribes to win a e560 million (R6.6 billion) contract for the sale of 12 helicopters to the Indian government.

An Italian investigation, which escalated last week with the arrest of the head of Finmeccanica, chairman and chief executive Giuseppe Orsi, is putting pressure on the Indian government, already buffeted by a string of graft cases. Orsi has denied any wrongdoing.

It has also become a political issue in the country ahead of parliamentary elections on Sunday and Monday.

India’s defence ministry has threatened Finmeccanica unit AgustaWestland with cancellation of the helicopter deal unless it can give assurances that no bribes were paid.

Finmeccanica has until today to respond to requests made by Indian authorities. The company has said that it would co-operate with them to clarify the matter.

Finmeccanica’s board meeting yesterday was also set to discuss the long-delayed sale of its AnsaldoEnergia unit but no decision on this issue was expected, a source close to the matter said. Finmeccanica declined to comment.

The group, Italy’s second-largest private sector employer, has put AnsaldoEnergia up for sale as part of an asset disposal plan aimed at streamlining the company and avoiding credit rating downgrades. – Reuters