UPA's spy plane scam: How price of cheaper EADS was inflated to benefit Boeing

"The CAG has noted that in June 2017, Navy concluded an interim support agreement (ISA) with Boeing, at a cost of $131 million, for a period of three years, containing components of products support also. Hence, M/s Boeing was benefited twice. Firstly, by inflating M/s EADS bid and secondly, signing a separate product support contract with M/s Boeing at a much higher price," a top BJP official told MyNation.

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After the details of the scam emerged in the Comptroller and Auditor General's (CAG) report tabled in Parliament on Tuesday, it was revealed that the deal signed during the Congress regime under prime minister Manmohan Singh was "incorrectly" awarded to Boeing, while European firm EADS CASA was the lowest bidder and deserved to have been given the contract.

A note prepared by the BJP said the defence acquisition council (DAC) had approved the acquisition of eight long-range maritime reconnaissance anti-submarine (LRMRASW) aircraft on September 16, 2005, and the tender asked for product support, in terms of maintenance, materials and spares, to be provided for a minimum period of 20 years.

"The commercial bids were received by March 16, 2006 where the commercial bid of M/s Boeing was $2,187.54 million (Rs 8700.37 crore at the rate of Rs 39.77/US dollar) and that of M/s EADS was €1323.72 million (Rs 7776.0 at the rate of Rs 58.74/euro)," the note said.

Also read — Another UPA scam? CAG says Boeing Navy spy planes were procured incorrectly in Rs 10,000-crore tender

The note further stated that the bid submitted by M/s EADS had included the cost of two years product support at the rate of €7.1 million per annum in their bid whereas the Boeing bid was silent on the issue." the document states.

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