When the Italian newspaper Lettera 43 published a story that referenced the father of the main commission agent in the AgustaWestland chopper scam, Wolfgang Max Michel Richard, it unwittingly pointed to a relationship that India and Westland Helicopters shared back in the mid-1980s.
“It is believed that British citizen Michel received 60 per cent of the kickback amount of Rs. 360 crore from Finmeccanica, the manufacturers of AgustaWestland choppers. His contacts are stronger especially with the Indian Defence that he has inherited from his father, Wolfgang Max Michel Richard, a British businessman, who was very active in India between 80s and 90s and was close to the Congress party,” the report stated.
What happened in the 1980s?
Back in 1985, India bought 21 Westland helicopters after Margaret Thatcher (then British Prime Minister) persuaded her Indian counterpart Rajiv Gandhi to ignore the advice of his experts, who were against the sale. The money for the deal, put at nearly £65 million, came out of Britain’s aid budget, and was given to India specifically for purchasing the helicopters.
Westland at the time was a solely British aerospace company that manufactured helicopters after World War II.
However, the copters that were sold proved to be a disaster — two of them crashed in accidents in August 1988 and February 1989, killing over 10 passengers.
“It was no secret back then that the helicopters were a safety hazard. There were a number of defects, and pilots were scared to fly them. They just wouldn’t step into those helicopters,” said a source with the direct knowledge of the matter.
“The whole deal was pushed through as a means of reviving Westland, which, at the time, was going through a difficult financial situation,” the source added.
In 1991, the helicopters were withdrawn from service on safety grounds, after a number of subcommittee reviews, by the Director-General of Civil Aviation. In 1993, Pawan Hans, the state-owned helicopter firm that operated the Westland copters, put out a global tender for the defective helicopters. Eventually, British firm AES Aerospace emerged as the sole bidder, and the entire fleet of Westland helicopters was packaged off to Britain for the scrap value of just £900,000.
During the period of operation of those helicopters, Pawan Hans incurred an aggregate loss of Rs. 95.67 crore, while the British national audit office concluded that its government lost more than £105 million due to the deal.
British firm GKN acquired Westland in 1998, and merged it with Finmeccanica’s subsidiary Agusta in 2000. In 2004, Finmeccanica acquired GKN’s stake in the joint venture.
Several questions remain. How much of this was brought up during the initial negotiations with Finmeccanica? How much of Westland’s design and engineering remains in the 12 VVIP helicopters purchased by India? Was the DGCA decision to ground Westland copters considered while signing a deal with Finmeccanica? Questions have also been raised on the rationale behind going in for a bulk copter deal.
Published - February 24, 2013 03:02 am IST
