Defence Analysts Call Out Sitharaman's "Clarification"

After a Twitter spat with Rahul Gandhi, Union Defence Minister Nirmala Sitharaman on Monday re-emphasised in the Parliament that her statement on orders worth Rs. 1 lakh crore for state-run defence manufacturer Hindustan Aeronautics Limited (HAL) was not false, as the Congress chief alleged. Reports on HAL's financial troubles have been seized by the Congress, which accused the government of depriving the company of a lucrative contract in the Rafale deal, just to help industrialist Anil Ambani.

"I would like to set all doubts to rest by adding that I have received confirmation from HAL that during 2014-2018, contracts amounting to Rs. 26,570.80 crore have already been signed with HAL and orders of approximately Rs. 73,000 crore are in the pipeline. The details of these orders are placed (here)…. the documents clearly confirm the correctness of my statement...and the doubts raised in this regard are incorrect and misleading," the defence minister said on Monday, January 7.

Newsclick tried to reach the employees’ union in HAL, but they were unavailable for comment.

On the other hand, many defence analysts have called out the sham in defence minister’s reply in the Parliament. D. Raghunandan, defence analyst and member of Centre for Technology and Development (CTD), told Newsclick, “This has become a habit of the present government on the Rafale issue and related subjects to make statements that are misleading and half-truths which appear to be credible, but hide more than they reveal.”

With respect to the current contracts and orders in the pipeline, he said, “While Rs. 26,570 crore may be signed as contract, the remaining 70 odd thousand crores which the defence minister is speaking of, are all in very early stages of negotiation. Even the amounts have not been finalised and contracts have not been signed, so, obviously neither has any money been transferred to HAL nor can HAL use these contracts to go to the banks for money.”

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He accused the defence minister of furnishing her speech to bolster her argument that the central government is supporting HAL. “But these are all commercial orders and they are not supporting anybody. The Rafale contract which the government has signed with Dassault, does this mean that they are supporting Dassault? It’s a commercial contract,” Ragunandan added.

The government’s apathy towards HAL can be seen by how it has been seeking loans from banks to pay its employees. He said, “If the government actually wants to support HAL, then it should be giving consistent help to HAL than just contracts. They have not paid money to HAL for services which have already been received. They owe HAL about Rs. 15,000 crore in back payments whereas HAL has already gone to banks seeking loans to pay their employees. All this clearly shows that the government has no concern for HAL and in fact is doing everything possible to undermine public sector undertakings.”