The story behind the bribe offer to COAS


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The revelation by the army chief of an offer of a 14-crore bribe has sharply brought into focus what was really at stake.  The bribe was allegedly offered by a lobbyist for  a truck supplier who  flooded the army for more than two decades with 7,000 over-priced vehicles which performed poorly when put to use.  Yet, this supplier, Tatra, a Czech manufacturer , who supplies the trucks to the Army through a Defence Public Sector Undertaking Bharat Earth Movers Ltd.  was not blacklisted.   In fact, the swindle worth hundreds of crores appears to have been facilitated by the government-owned BEML which supplies the army with trucks and other equipment.
The middleman who met General Singh wanted clearance for one more batch of 1600 vehicles in September 2010.  For this, the lobbyist allegedly offered 14 crores.  In 2010,  the government changed the rules so that different manufacturers could apply for the contract through open bidding.  After nearly 25 years of a monopoly, Tatra became one of the three or four contenders. The Ministry wanted the open tender to be implemented from that year onwards. But two years on, the contract remains un-awarded for various reasons. 
Tatra all-weather all-terrain trucks are  used to transport missiles, artillery and troops .  These trucks are manufactured in Czech Republic  The cost to the country has been huge.  A  4X4 Tatra truck, for example,  costs between 40 to 50 lakhs in Europe .  It was sold by BEML to the army at to nearly double that price.  Ashok Leyland and Tata Motors supply these trucks at between 16-18 lakhs for similar trucks. Jacks for theTatra truck, available in the market for Rs 3000 for similar heavy vehicles,  were  bought for Rs 30,000 each by BEML on behalf of the army.
The top dollar paid for the trucks wasn’t matched by performance.  A whistleblower named Anil Bakshi  reveals  that the army has for a while been unhappy with the performance of the Tatra trucks.   Mr Bakshi was a defence contractor for the Indian Army and was contracted to prep vehicles for the army’s use after they had been bought.  In 2009, he said that 45 Tarra trucks arrived with faulty or damaged tyres and old batteries.  He refused to clear them for usage.
Other experts say that spare parts are not easily available for Tatra trucks. BEML takes upto two years to supply spares.
Instead of buying these trucks directly from the manufacturer, BEML uses a middleman named Tatra Sipox, a London-based trading company.  However, government rules make it necessary for all defence equipment to be bought directly from the manufacturer.   In 1986, India signed a transfer-of-technology agreement witha Czech company named  Omnipol.  The idea was for BEML to learn how to eventually build heavy vehicles locally.  That deal continued till 1997 when BEML signed with  Tatra Sipox, a London-based trading company, and not the original manufacturer of the trucks. The Czech company is the original manufacturer. In violation of defence rules, a middleman or dealer had entered the picture.  BEML never gathered the expertise to eventually build a Tatra-like truck on its own
  1. December 1, 2012 -

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  2. April 4, 2013 -

    In depth analysis, Interesting story