With Finmeccanica Goes India's Reputation

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In the Finmeccanica scandal, which we started to cover in Part One, Shashi Tyagi, a former Indian air force chief, has been quoted as saying, “The charge is that it appears that I was bribed to change requirements so that AgustaWestland could take part in the competition,” noting the final order was not confirmed until three years after he retired.

In India, the allegations have ignited a political storm as opposition parties claim the government knew about these rumors two years ago and have not named any politicians said to also be involved. The Indian Central Intelligence Bureau has now launched its own probe, but has said requests for information from European government agencies have not yielded anything of value.

Whether any bribes were paid is too early to say, but the reaction in both countries highlights the damage that past misdemeanors have caused.

In India, any suggestion of wrongdoing nowadays brings on near-hysteria, particularly among state enterprises. Bidding processes have been changed in the last 12-18 months so that all bids are filed electronically and strict cut-offs prevent competitors seeing each others prices.

Such adoption of technology and practices developed in the US and Europe 10 years or more ago to improve competitive bidding processes have cleaned up the act of virtually all state enterprises. However, requests for any change in specifications or bidding terms, such as, in this case, an alteration to the altitude ceilings, is still met with extreme caution verging on paranoia.

From cases such as this, whether eventually proved valid or groundless, come better business practices. India and Italy may have a murky past, but they are both trying to make for a more transparent – and fairer – future.

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