16 May, 2021

A Bomb Waiting To Explode

Will the CBI's second probe into the deal yield results?

A Bomb Waiting To Explode

THE AEG-T-Indian Navy torpedo deal has returned like, well, a redirected torpedo to haunt the J.H. Patel-led Janata Dal government. In the mid-'80s, the Indian Navy had ordered HDW submarines, and chose AEG-T, then in West Germany, to supply torpedoes for them. The deal was worth a hefty DM 150 million. As New Government Engineering Factory (NGEF), Bangalore, was AEG's technical collaborator in India, the public sector company was entitled to a commission on every AEG sale in the country whether the sale was aided by NGEF or not. However, during the accounting of NGEF in 1988-89, AEG was found to have not paid the 2.5 per cent commission due in the torpedo deal. The controversy, not surprisingly, raised a lot of dust. Former chief minister Ramakrishna Hegde and J.H. Patel, then the industries minister, were accused by the Opposition legislators of acting hand-in-glove with NGEF administrators to deny the company the commission. In response to the allegations, Patel, who was president of the state Janata Dal in 1990, denied that any commission was due to NGEF. He...

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