Blacklist stares at Dassault over Aero India bribery scandal

French aircraft maker Dassault, which is in the race for India's $10 billion MMRCA fighter deal and is tipped to receive a $2.1 billion Mirage warplane upgrade contract, may have exposed itself to the charge of bribing an Indian Air Force (IAF) officer at last month's Aero India 2011. This could lead to blacklisting from doing business with India if the MoD goes strictly by the rule book. On a complaint by a Dassault executive, the Indian MoD had arrested an IAF officer for accepting a bribe. However, it has now transpired that the complaint was made after an initial payment had been made out of a consideration of INR300000 (approx Euro6000) for a favorable tarmac slot for the Rafale fighter in Aero India's static display. The Dassault executive approached the Aero India organizers after the accused officer persisted to pay up the balance. A sum of INR20000 (approx Euro 340) was the paid to 'trap' the officer concerned to prove the bribery demand. If this is true, Dassault could run foul of the MoD's policy of blacklisting vendors who indulge in any form of bribery. Informed sources contend that if this aspect is revealed in the inquiry against the accused officer, then questions will be asked as to why Dassault agreed to the bribe and paid the first time and later complained after persistent demands to pay the balance was made. More importantly, questions regarding what action the MoD has taken against the company may arise under India's system of governmental checks and balances after the inquiry against the officer is over. The Indian MoD could then be in fix as to how to handle this situation. Going by the book, it will have to apply the same yardstick it did in the case of Denel of South Africa and Singapore Technologies with whom all dealings have been suspended following allegations of bribery. India's defence minister, A.K. Antony has been very vocal about keeping the defence procurement system clean of any bribery scandal. A defence analyst speculated, "does this mean Dassault has to withdraw from the MMRCA competition? Does Dassault have to forego the Mirage upgrade programme to be signed in few weeks?" The rule book say "yes". However, the bribery charge is being seen by some as a ploy to discredit Dassault with the MMRCA competition so close to fruition. A similar incident occurred during the final run up of the Korean fighter competition in 2002. The Dassault Rafale was then competing against the Boeing F-15K. After the end of the technical evaluation, the Rafale was reportedly leading the race and Dassault was suddenly accused of having bribed a Korean office $8000 to promote the Rafale offer. The complaint turned out to be bogus upon investigation. So does the Indian bribery incident mean that the MMRCA competition is turning dirty?