US company favoured over India in boat deal

Discussion in 'Indian Navy' started by JAISWAL, Jan 2, 2012.


    JAISWAL Senior Member Senior Member

    Mar 13, 2010
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    US company favoured over India in boat deal

    The Ministry of Home Affairs (MHA) has flouted
    all procurement rules to nominate a US boat
    building company for the purpose of buying 150
    coastal security boats. The global tender launched
    for this Rs 500 cr deal kept out all Indian players
    by introducing clauses that are difficult to be
    fulfilled by them. Moreover, some of the
    equipment requirements mentioned in the tender
    are not needed by the Marine Police Organisation,
    which will use the boats.
    The Request for Proposal (that is the tender),
    which is on the MHA website, shows (Page 103,
    para 2.1.6) that the US Arneson's "surface piercing
    drive" has been nominated for the deal. Further,
    under "Routine Maintenance", the model
    "Arneson Drive, model ASD 14" is mentioned on
    page 67.
    The Marine Police Organisation was formed post
    the 26/11 terror attack. A fleet of around 280 boats
    was sanctioned for it for the purpose of patrolling
    and guarding India's vast coastline. The first order
    of 120 boats went to the Defence Public Sector
    Units (DPSUs) -- the Goa Shipyard Limited (GSL)
    and the Kolkata-based Garden Reach Shipbuilders
    Engineers (GRSE). These boats were delivered
    two years ago and have been performing well.
    Recently, the tender for another 150 boats was
    floated globally. Indian as well as global
    manufacturers participated in the bidding
    Sources say that the propulsion system
    mentioned in the tender is not required by the
    Marine Police Organisation as it will not be able to
    exploit and maintain such complicated
    equipment. Indian Navy is already facing a
    number of problems because of this equipment
    fitted on its Fast Attack Crafts. A regular fixed pitch
    propeller system is best suited for the Marine
    The speed requirement in the latest tender has
    also been revised from the earlier tender's "high
    speed" to a maximum of 25 knots. Sources said
    that the system nominated by the MHA has a
    cruising speed of 12 knots and a maximum speed
    of 25 knots. India does not need such a high
    speed boat when the job can be done by a boat
    with a lower speed.
    Another clause that keeps out Indian
    manufacturers is the earnest money deposit
    (EMD) clause in Para 2.11 of Schedule 1. It states
    that the EMD requirement is Rs 7.5 cr. The annual
    turnover requirement for the company that will
    get the contract is Rs 50 cr in the last three years,
    making it Rs 150 cr in the past three years. A
    source told this newspaper, "Clearly no Indian
    boat builder, who makes boats of this type, can
    qualify. In addition, the requirement of having
    built at least 25 boats in one year in the past three
    years may even disqualify public sector yards like
    GSL and GRSE, who have set up significant
    infrastructure and built the previous series of
    boast for the MHA (Phase-1 boats)."
    All this amounts to a single vendor nomination,
    which as per procurement procedures of security
    equipment is not acceptable, and has in the past
    resulted in retraction of tenders.
    When The Sunday Guardian contacted MHA
    officials, they said that the ministry had held a
    pre-bid conference in November, in which it
    sought the views of the manufacturers. These
    views are under consideration and if needed the
    RFP would be amended. The officials said that a
    level playing field for Indian manufacturers would
    be considered by introducing changes in the
    tender before it expires. The last date for the RFP
    is 16 January 2012. The MHA follows the
    procurement manual Directorate General of
    Supplies and Disposal (DGS&D), for all its
    purchases. 15 boat manufacturers attended the
    pre-bid conference in November.
    According to sources, GRSE and GSL officials met
    Home Minister P. Chidambaram recently to say
    that since they had won the first contract and had
    delivered the boats, they should be given the
    second contract too.
    The tender also combines the vessel order along
    with annual maintenance contract (AMC). AMC
    contracts are usually tendered out separately to
    service providers suited best for such jobs.
  3. Ray

    Ray The Chairman Defence Professionals Moderator

    Apr 17, 2009
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    Stand by for another scam?

    Does the CG have any provisions to raise GSQRs?

    Chiadambaram, the Home Minister wants PSUs but the MHA doesn't!

    Is it a way to save himself later or has he lost control over his ministry, baulking at the fear of Dr Subrahamanium Swamy?

    What a way to be governed!
    Last edited: Jan 2, 2012
  4. asianobserve

    asianobserve Elite Member Elite Member

    May 5, 2011
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    The guys at MHA may be fanboys of this wonderful ship, M-80 Stilleto:





    This is powered by US Arneson's "surface piercing drive."
    Last edited: Jan 2, 2012
  5. sob

    sob Moderator Moderator

    May 4, 2009
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    New Delhi
    This looks like a mean machine.
    If this was part of the original specifications then there is no problem in the deal.
    You cannot compare oranges with apples.
  6. anoop_mig25

    anoop_mig25 Senior Member Senior Member

    Aug 17, 2009
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    ah not possibles for our babus to override decision of their bosses.well chindram itself must have introduce such clause so as to debard any indian company from participating.another scandle in castle of upa regime.hope some sane mind stands up and bring out whole truth so that we home minster id forced to resign
  7. W.G.Ewald

    W.G.Ewald Defence Professionals/ DFI member of 2 Defence Professionals

    Sep 28, 2011
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    North Carolina, USA
  8. asianobserve

    asianobserve Elite Member Elite Member

    May 5, 2011
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    This propulsion system is primarily used for racing boats, here are some pictures:



    So the MHA must be looking at really cool coastal security boats...:namaste:
    sob and W.G.Ewald like this.
  9. bhramos

    bhramos Elite Member Elite Member

    Mar 21, 2009
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