India cancels Pilatus aircraft purchase amid corruption probe

Switzerland’s embattled aircraft manufacturer Pilatus is facing problems on a new front: India. The Indian Air Force has reportedly decided to forego the purchase of 38 new PC-7MKII training planes.

The Hindustan Time, India’s largest English-language newspaper, broke the news on Friday. The report was picked up by Switzerland’s German-language weekly SonntagsZeitung.

The original report quotes two senior Indian officials who requested to remain anonymous.

India’s Central Bureau of Investigation (CBI) is probing an earlier deal with the Swiss plane maker for 75 aircraft, for alleged corruption and irregularities, according to these two sources.

That deal included a follow-on purchase of 38 additional planes.

CBI has alleged that Pilatus Aircraft Limited entered into a criminal conspiracy with notorious arms dealer Sanjay Bhandari and Bimal Sareen, both directors of Offset India Solutions Private limited.

This agreement, according to the agency, was in violation of India’s weapons procurement rules.

The agency also claims that the plane maker deposited CHF1 million in the account of Offset India Solutions in two installments in 2010.

The Indian report newspaper said it was unable to get a response from the Swiss aircraft manufacturer before going to press.

Pilatus also declined to respond to a query from SonntagsZeitung.

Last month, a company representative declined comment telling swissinfo.ch that alleged kickbacks have been a subject of repeated discussion in the Indian media.

Pilatus is also under scrutiny at home. Switzerland’s office of the attorney general has opened a criminal investigation in connection with the sale of military training aircraft to Saudi Arabia and the United Arab Emirates.