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Government waived anti-corruption clauses in Rafale deal
Why in news?
- Rafale deal involved unprecedented concessions from the Indian government. It has dropped provisions for anti-corruption penalties and making payments through an escrow account days before the signing of (IGA).
- This has significant political implications government which has claimed that eliminating corruption is a major plank of its agenda for governance and promised action against alleged corruption in defence deals.
More about the news
What has dropped:
- standard Defence Procurement Procedure (DPP) clauses on Penalty for use of Undue Influence, Agents/Agency Commission, and Access to Company accounts of Dassault Aviation and MBDA France were dropped by the Indian government in the supply protocols.
What is the concern:
- It is significant that neither above nor other important information conducted by the PMO and the National Security Adviser seems to have found a place in the material submitted by the government to the Supreme Court of India.
Changes in the clause:
- Defence Acquisition Council (DAC) ratified and approved eight changes in the IGA, supply protocols, offset contracts and offset schedules.
- most significant among these eight changes is clause (c). This states: Non-inclusion of the Standard DPP Clauses related to Penalty for Undue Influence, Agents/Agency Commission and Access to Company Accounts in the Supply Protocols.
Why MoD opposed the changes:
- procurement is on Government-to-Government basis.
- The IGA involves Transfer of Rights and Obligations relating to supplies of equipment and related industrial services by French Government to the French Industrial Suppliers.
- The payment is also being made to the French Industrial Suppliers and not to the French Government.
- Therefore, it is not advisable to sacrifice the basic requirement of financial prudence.
Source
The Hindu