TOI reported on Friday

Formalisation of orders takes time

BENGALURU: India’s leading defence PSU Hindustan Aeronautics Limited (HAL), grappling with stressed finances, is keenly awaiting formalisation of orders adding up to Rs 1 lakh crore mentioned by defence minister Nirmala Sitharaman during the discussion on the Rafale fighter deal in the Lok Sabha on Friday.Though the acceptance of necessity, part of the initial approval, and clearance by the Defence Acquisition Council, has been completed for some of the orders, no actual order has been placed yet.As, the cash-strapped defence PSU was forced to borrow close to Rs 1,000 crore to pay salaries. HAL’s largest customer, the Indian Air Force , had not cleared its dues.Defence minister Nirmala Sitharaman told Lok Sabha on Friday that the Modi government had given orders worth Rs 1 lakh crore to HAL. However, even though the acceptance of necessity — part of the initial approval — and clearance by Defence Acquisition Council has been completed for some of the orders, no actual order has been placed yet.Senior HAL management officials who didn’t wish to be named told TOI that no actual order has been placed and not a single rupee has been released to the company.The formalisation of orders, which in the case of aircraft needs approvals from the aeronautical development agency and involves discussions on cost, can be time consuming. As TOI reported on Friday, the cash-strapped defence PSU was forced to borrow close to Rs 1,000 crore to pay salaries. HAL’s largest customer, the Indian Air Force (IAF), had not cleared its dues.“HAL is a listed company now. You are free to verify our order books, where you will find not a single rupee of the said Rs 1 lakh crore has come to HAL, since not a single order, as claimed, has been signed till now. We have a responsibility to shareholders who cannot be led to believe we have orders when we don’t,” senior officials in the HAL management said. However, as the LS record shows, Sitharaman did not claim the orders were signed, saying they were in the works.Contacted on Saturday, the defence ministry spokesperson did not respond to specific queries by TOI. HAL officials said: “The LCA (Mark-1A) is still at the RFQ (request for quotation) level and the bid for the aircraft has not even been opened. It’s the same with Kamov helicopters, which isn’t even a HAL project but a joint one with Russia, where HAL will play a minor part.” Another official added, “No order has been placed yet for the Dornier or the engines. In fact, we will not even get the 150 engines as planned since the numbers were trimmed to 130 during negotiations.”The only order placed with HAL under the current regime is for 73 advanced light helicopters.HAL Employees’ Association general secretary Suryadevara Chandrashekhar confirmed that “there have been no orders, or advances” till now. “Each of these (ALH) choppers is priced at an estimated Rs 70 crore and some advance has come our way,” he said.