The Centre has admitted that not a single person has registered as an authorised arms agent over the past six years.
The government and bureaucracy remain divided over the decision to ban arms agents
NEW DELHI: The Centre has admitted that not a single person has registered as an authorised arms agent over the past six years, even as the government remains deeply divided, both at the political and bureaucratic levels, over the decision to ban arms dealers.
The National Democratic Alliance (NDA) government had in November 2001 issued a notification to allow individuals to register as arms dealers, further liberalising a technically existing permission for agents to operate in the lucrative defence market. “So far no authorised Indian representative or agent has been registered by the Ministry of Defence, under new terms,” Defence Minister AK Antony told the Rajya Sabha.
Antony told the Parliament that in November 2001, the Finance Ministry had issued supplementary instructions to regulate authorised Indian representatives and agents of foreign arms suppliers.
The new instructions provided for regulation of representational arrangements through a system of registration, categorical and open declaration by the foreign suppliers of the services to be rendered by their authorised agents and the remuneration payable to them by way of fees, commission or any other method.
The 2001 supplementary instructions had been issued by the NDA regime after bringing in changes in the original format announced for such agents in April 1989 by the MOD.
He pointed out that the new Defence Procurement Procedures provide for “direct dealing with Original Equipment Manufacturers (OEMs) or Authorised Vendors or Government Sponsored Export Agencies (applicable in case of countries where domestic laws do not permit direct export by OEMs).”
A debate has been on in the government and ruling front since mid-2006 when the CBI carried out extensive nationwide raids on arms dealers for their alleged role in several deals struck during the previous government.
There is a strong lobby in the ruling front that has been demanding a complete ban on arms dealers, and sources indicate that even UPA chairperson Sonia Gandhi may be in favour of such a blanket ban.
After the CBI raids, Prime Minister Manmohan Singh had said: “If it does turn out that one cannot do without agents, then we must know who they are and register them or devise a variation in the mechanism.”
There are also differing views on the issue within the officialdom of the Ministry of Defence and Antony will have to take a final call on the issue.
It is all the more imperative because several fiercely competed for defence deals are in the final rounds and the next year’s defence budget has Rs 41,922 crore for fresh purchases under capital outlay.
And any allegation of middlemen would have huge political fallout for the government as it winds through elections.
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