The Bofors guns became a household name in India following the bribery and corruption scandal that erupted around the purchase way back in 1986. More recently, these AugustaWestland helicopters went the same way.
Now, the Narendra Modi government is hoping to give the defence sector a fresh push which has domestic and foreign players excited. But past allegations of bribery and corruption with minor improvement in governance standards of domestic companies may prove to be a challenge.
A survey by Transparency International UK says Indian companies, especially those that have been in the field for quite a few years need to do much more.
Of 163 defence companies from 47 countries that were assessed using publicly available information relating to ethics and anti-corruption programmes, four Indian companies - Hindustan Aeronautics, Bharat Earth Movers or BEML, Bharat Electronics or BEL, and the Indian Ordinance Factory - have been ranked in this year's report.
The report rated companies in six bands depending on public evidence of their ethics and anti-corruption programmes. HAL has been placed in Band-D, which means limited evidence is available of the existence of such practices. BEML and BEL find themselves in Band-E -- that's extremely limited evidence and the Indian Ordnance Factory has been placed in Band-F, signifying almost no evidence. But there is a silver lining: BVEL and BEML have both improved by one band when compared to the 2012 survey.
But it's not just Indian companies that we need to worry about, since over 70 percent of India's defence needs are met through imports. Of the 163 global companies surveyed, 66 percent, that's 107 companies, have found themselves in the bottom half of the index signifying limited to no evidence of such programmes.
These include some well-known names like Sukhoi, Tatra Trucks, Russian Helicopters, and Israel Military Industries. 23 percent of these, or 37 companies, provide no evidence at all.
On the other hand, companies such as Rafael, Fujitsu, Airbus, Boeing, Bechtel, Lockheed Martin, Rolls Royce, and Saab, which have an association with India, rank in the top bands of the index.
Now the report does go on to say that improvement has been evident in companies from every region of the world, but with more Indian companies arming themselves to enter the defence space, and numerous foreign companies gunning for lucrative Indian defence contracts, the Modi government will have to set the bar on such practices high, if it wants to avoid defence scandals.
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