Govt halts public-pvt defence jt venture after complaints

New Delhi, Sep 26 (PTI) The first-of-its-kind joint
venture between the state-owned Mazagon Dockyards Limited and
Pipavav Shipyard to build warships and submarines through
public-private partnership mode was Monday put on hold by the
Indian Government in the wake of complaints by some companies.
The Defence Ministry put on hold the JV till the time the
government comes up with a new policy.
"The issue needs to be fully examined and settled before
any forward movement takes place on this front," Indian
Defence Minister A K Antony told a meeting of Consultative
Committee attached to his ministry here.
Stressing on complete transparency in the procedure,
Antony said "we are treading on a new path and we would like
to ensure that transparency is maintained at all levels".
As per the agreement, the two companies had agreed to set
up the JV company -- Mazagon Dock Pipavav Ltd -- to
fast-forward the process of warship and submarine contracts
held currently by the MDL.
Mazagon Dockyards Limted (MDL) is the largest of the four
defence shipyards with contracts of around USD 20 billion
including that for building six Scorpene submarines, several
frigates and destroyers for the Navy.
After MDL and Pipavav announced their JV, two other
bidders, ABG Shipyard and Larsen and Toubro (L&T) questioned
the selection process.
Both the companies, in their separate letters to MDL,
said they have not been given a chance to respond to MDL's
proposal to become the joint venture partner, despite making
presentations to the defence PSU on August 23 and submitting
their Expression of Interest (EoI).
Observing that the JV should not be formed on nomination
basis, Antony said they should compete for contracts.