"Undue Favours" to Armaris in Scorpene Deal

The table above, published in the latest audit report of the Comptroller & Auditor General (the Indian government's audit body) lists out what it calls "undue favours" provided to Armaris, the consortium that was contracted for six Scorpene submarines in 2005 at a cost of Rs 18,798 crore. The report finds that a minimum of Euro 58.20 million (Rs 349 crore) besides other unquantifiable benefits, were allowed as advantages to Armaris in the contract. The conclusion: "To sum up, over nine years were taken to finalise the contract. Apart from theprice escalation, it is also likely to adversely impact the operational capabilityof the Navy. The Ministry / Naval HQ scaled down the original technicalspecifications and extended undue financial benefit to the vendor."

Coming up: The India audit watchdog slams HAL

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