The Comptroller and Auditor General(CAG) on Friday pulled up the IAF for its failure to project a long-term requirement of aero engines for its fleet of 105 AN-32 transport planes resulting in an “avoidable expenditure” of Rs 227 crore. Moreover, delay in setting up infrastructure worth over Rs 272 crore in Kanpur for mid life up-gradation of these planes led to grounding of half of the fleet last year, it noted.
Making these observations in its report tabled in Parliament, CAG said these losses to the exchequer were due to lack of proper planning, effective price negotiation and proper monitoring of acquisition process. In the first case, the CAG said IAF procured 17 engines in 2007 and 100 engines in 2009 for the AN-32 transport fleet which is backbone of the force for providing logistical support to jawans deployed in inaccessible areas.
The IAF had paid USD 719,500 (Rs 3.16 crore) per engine against the contract of June 2007, whereas, it had to pay USD 10,90,000 (Rs 5.43 crore) per engine against the contract of December 2009. Thus, IAF had to incur a total of Rs 227 crore extra on procurement of 100 aero-engines, it said.
“Despite being aware of long-term requirement of aero-engines, IAF failed to project the entire requirement which resulted in the extra avoidable expenditure,” CAG said. Elaborating upon it, the report said despite being aware in 2004 of the long term requirement of engines for sustaining the fleet for 25 years, the IAF concluded the contract in 2007 only for 17 engines with an option to procure 13 additional engines in 2008 leading to the loss.
On the delay in setting up infrastructure, the CAG said India had signed a contract with Ukraine for upgrading the fleet of 105 aircraft of which 40 were to be modernised in Ukraine and the remaining in Kanpur.
“Due to delay in initiation and conclusion of the contract, facilities for up-gradation of aircraft could not be set up in time despite an investment of Rs 272 crore on Transfer of Technology resulting in grounding of more than 50 per cent of the transport aircraft fleet,” it noted. Incidentally, nearly all the aircraft sent for upgrade in Ukraine have returned after refit, officials said here.