In what could be a scam bigger than the AgustaWestland VVIP chopper deal , the government has ordered a probe into alleged 'favours' done by the previous Congress-led UPA government in awarding defence contract to an Italian shipbuildingfirm. The naval scam could have far bigger implications than the Agusta deal.

According to exclusive details available with India Today, Defence Minister Manohar Parrikar has ordered a "discreet inquiry" into the alleged naval tanker scam.

The Indian Navy has two fleet tankers INS Deepak and INS Shakti, that provide the Indian Navy's frontline warships with fuel, water and all other essentials while out in the sea. But the deal signed in 2009 to acquire them is now under scrutiny.

A serving 'whistleblower' naval officer has now raised a red flag over the way these ships were acquired from an Italian firm - Fincantieri.

What's the scam



Italian firm - Fincantieri - reportedly favoured by the UPA government. The company won deal from the government for two naval tankers in 2009. The UPA government approved use of inferior quality of steel in the naval tankers manufactured by the firm. The government is now scrutinising details of the contract awarded to the Italian firm. The lid over the scam has been blown off by a former naval officer who has demanded an investigation into the 2009 purchase of two fleet tankers, crucial for Indian Navy's deep water capabilities. These tankers had to be bought in 2009 and 2011 because INS Vikramaditya, Indian Navy's biggest aircraft carrier, was coming on from Russia. At that time, the then Defence Minister AK Antony had hailed this as one of the fastest procurements of a fleet tanker manufactured with Indian specifications. There are allegations that instead of using weapons grade steel, commercial grade steel was used. When one of the tankers was coming to India from Russia escorting INS Vikramaditya, it ran into rough seas and hull of the brand new ship developed cracks.

Naval scam: A timeline



- 2006: India floats bids for navy tanker ships

- Three countries - Russia, Korea and Italy - file respond to the tender.

- Only Russian firm offers required military-grade steel (DMR 249A)

- India relaxes steel requirement, Russia backs out

- 2009: Italian firm Fincantieri wins deal for 2 tankers

- 2010: CAG criticises the deal, says 'undue' favours were done

- 2016: Navy officer sounds alarm, Ministry of Defence begins discreet inquiry

Naval veterans react

Vice Admiral Shekhar Sinha, former flag officer commanding in chief of the Western Naval Command, was in service when the murky deal was signed.

"When she (INS Deepak) was in passage and crossed the Atlantic, the sea had turned very rough and the vessel was keeping difficulty in sea keeping. We know that the tankers can keep to bad sea. I have commanded a tanker myself. The captain reported that he has seen some crack developing along the expansion joint on the hull. We told him to keep a watch," Vice Admiral Sinha told India Today.

"It (cracks) alarmed me and the entire operations team. When the captain told us that the cracks are developing, we got in touch with the naval headquarters and requested them to take the ship to Lisbon, Portugal, which was not a scheduled halt," he added.

Admiral Raja Menon told India Today," I have never come across warships made of commercial grade steel. I don't know whether conditions were deliberately relaxed because it happened to be a tanker."

"I have never come across a case where shipbuilding specifications have been watered down. This should be investigated. I can't believe that the people in authority would have deliberately allowed military grade steel to be downgraded to commercial steel without giving reasons," Admiral Menon said.

Ready for any probe: Congress

Reacting to the India Today expose, senior Congress leader and former Commerce and Industry Minister Anand Sharma said that his party is ready to face probe in the matter. Sharma said the BJP should stop vendetta politics.

"I would like to caution this government of not to enter in deception by selective leaks. It should realise that defence acquisition is a complex matter and it should not be used to target previous acquisitions," Sharma said.

"What is the ministry of defence doing? They should be doing their job correctly. They don't need a whistleblower to tell them what is happening. We are always ready for anything," he said when asked about is the Congress is ready for a thorough probe into the issue.

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