National
'Kargil was an excuse to push through procurement'
By Sandeep Dikshit
NEW DELHI, DEC 11. Though the emotive case of importing grossly over-priced coffins for the Army held centre-stage in Parliament today, the issue is just a footnote in the report by the Comptroller and Auditor General (CAG) on purchases made for the Kargil War - Operation Vijay - after relaxing the relevant rules.
Nearly all the purchases, including the coffins, arrived well after the war was over though the idea behind waiving the rules was to ``quickly secure supplies'' for Operation Vijay. In fact, only a quarter of the agreement was signed while the war was on.
In at least three dozen cases, the Government ``knowingly'' paid an additional Rs. 44 crores. Supplies worth over Rs. 250 crores did not meet quality standards and the use-by-date for ammunition worth Rs. 100 crores had expired.
The Defence Ministry, headed by Mr. George Fernandes, also imported ammunition worth Rs. 342 crores on grounds of operational emergency although it was being manufactured indigenously by the military's captive units. Further, processing delays obstructed the deployment of Rs. 200-crore worth of stores.
``Thus, while critical supplies of clothing, ammunition and arms could not reach the troops during the (Kargil) operation, almost half of the total, entirely in foreign exchange, was spent fruitlessly, breaching established principles of propriety,'' said the CAG's review of procurement for Operation Vijay.
While Mr. Fernandes may claim that the contract for importing the coffins was not brought to his notice at all, the CAG has revealed an instance where the Minister himself authorised several major deviations in standards while importing automatic grenade launchers (AGLs) from Russia. The equipment fell short of the maximum range and rate of fire and there was no facility to replace the barrel which ``would render the launcher useless after 6,000 rounds.'' Typical of the slipshod manner in which contracts were negotiated during the conflict, the Defence Secretary was by-passed and his subordinate approved the import of the ``vintage'' time fuses.
That the Kargil War became a first-rate justification for placing orders on companies, the antecedents of which were unknown in the Ministry of Defence has also been uncovered by the report. A test check revealed that one-third of the procurement was from first-timers. ``In an emergency situation, a reasonable expectation would be to place orders on proven suppliers,'' remarked the CAG. Besides, there was an urge to import most of the weaponry and stores even though the public and private sector companies here were prepared to supply some of them.
After analysing the purchase decisions, the CAG was forced to remark that ``excuse of Kargil was cited to push through procurements that would otherwise have been scrutinised more closely.'' The Defence Ministry was completely undiscriminating towards the countries of origin as they included the French-made `hand held thermal imagers,' made infamous by the Tehelka expose, Russian terminally guided munitions and flame throwers, South African anti-material rifles and Israeli ammunition for T-72 tanks.
The CAG also exposed several cases where equipment was purchased well above requirement (three times in one instance) or it became redundant. To this, the Defence Ministry said the surplus stock in its stores was due to the early end of the conflict.
Earlier in the report, the CAG explained the circumstances in which it was asked to pan the `Kargil War imports' and the Government's justification for making these flash purchases. The catalyst for the special audit was several accusations of irregularities in emergency procurements which compelled the Government to seek the CAG's expertise in assessing the efficiency and effectiveness of defence purchases in a ``crisis'' and to identify major cases of irregularities. If the CAG audit is any indicator, the picture is not very pretty.
The CAG also mentioned the parameters that were relaxed for this emergent situation. Most of them pertained to excusing companies from signing performance bank guarantees and payment through letter of credit instead of payment against bank guarantees. In most cases, the old rates at which the equipment was purchased were not available - either the last purchase price was not available in the file or not taken into account by the official purchasing committee.
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