A Comptroller and Auditor General (CAG) report pointed out irregularities in the purchase of five aero engines for Unmanned Aero Vehicles (UAVs) by the Indian Air Force in 2010 from Israel Aerospace Industries (IAI). The DRDO laboratory had procured the same variant of the five Rotax 914 F3 engines to be fitted on the Herons at ₹24.30 lakh per engine in April 2012. The IAI secured benefits of ₹3.16 crore from the contract. In the international market, the average price of the engine would be ₹21-25 lakh. The report accused the vendor of wrongly mislabeled and supplied uncertified engines to the IAF, which led to several accidents, including the loss of one UAV in a crash.
“Israel Aircraft Industries (IAI) Ltd. gained an undue benefit of ₹3.16 crore as it supplied five UAV engines at more than three times the market price or the price offered to the DRDO unit. The vendor supplied uncertified engines while the contract was concluded for certified engines” read the report tabled in the parliament on Wednesday The contract with the IAI specified that the engines would be certified by the European Aviation Standard Agency.
The CAG recommended an investigation into the matter and fixing of responsibility for wrongful supply and acceptance of mislabeled engines by IAF. The report further stated that there were irregularities in the IAF records that revealed that the engines were delivered at an Air Force station and not the designated Equipment Depot of IAF, which was the consignee as per the contract.
A senior Indian Air Force office, as a response to the report, said that the mislabeling of the engines would be looked into however, the procurement of the engines and their price negotiations are not under the domain of the IAF as the Defence Ministry conducts them.