18 January 2020
New Delhi: The Ministry of Defence landed in a controversy after Congress alleged that Adani Defence and state-owned Hindustan Shipyard Ltd (HSL) joint venture is being favoured through tweaking procurement guidelines to participate in a Rs 45,000 crore submarine project -- referred to as project 75-I.
In another development, the Defence Acquisitions Council meeting chaired by Defence Minister Rajnath Singh slated for Friday had been deferred till January 21, sources said.
The Adani Defence and HSL joint venture matter, and it not qualifying for the contract bib are likely to be taken during the meet.
The Congress has alleged that through making changes in the procurement rules Adani Defence, with zero experience in submarine manufacturing along with Hindustan Shipyard Limited (HSL), is being allowed to participate in the Rs 45,000 crore submarine project.
The bid is for a contract under which an Indian shipyard will be chosen to manufacture six conventional submarines in collaboration with foreign partners.
The Congress has asked the government whether it is trying "to favour the Adani Defence JV" in the Rs 45,000-crore submarine project "in violation of the defence procurement procedures" and "by overruling" the Navy's high-powered committee which "found the firm ineligible" for the deal.
In presser in Delhi, Congress' Randeep Surjewala said (Prime Minister Narendra Modi) Modi government and the PMO (Prime Minister Office) overruled suggestions made by the empowered committee, constituted by the Indian Navy, although the deal had not been finalised yet.
He said that an empowered committee of the Indian Navy headed by Navy's Controller of Warship Production and Acquisition rejected Adani's bid to manufacture submarines because his company was not found to be eligible.
However, by overruling the decision made by the empowered committee, the Modi government allowed Adani Defence JV to take part in the project, he said.
Adani's company sought to manufacture submarines based on a clause wherein its experience of setting up and running a power plant is counted, which is in the complete violation of the procedure, the Congress leader had alleged.
"Empowered Committee of the Indian Navy shortlisted two entities which are government-owned Mazagaon Dock Shipbuilders Limited and Larsen and Toubro, but PMO directed consideration of Adani JV," he had alleged.
The Navy panel had shortlisted two entities that would qualify to bid for the project both of which have considerable experience in shipbuilding.
The third bid which was made by Adani Defence and HSL jointly was cleared on the grounds that administrative permissions are not in place for the joint venture.
Following this, the Department of Defence Production had asked the Indian navy to consider Adani-HSL. However, the department also stated that the proposal for the formation of a joint venture by HSL with Adani was still under consideration by the ministry.
Also last year in September, the Adani Group's bid for the submarine project was a last minute one. Adani Group currently does not own an active shipyard. HSL, which has experience in submarine repairs and overhauls, has also put in a standalone bid.