Agusta FDI hike proposal deferred

The Foreign Investment Promotion Board (FIPB) has deferred a proposal by AgustaWestland in a meeting last month to increase FDI in its joint venture company with Tata Sons in India, Indian Rotorcraft.

This, even as FIPB, in the same meeting held on April 8, cleared seven separate FDI proposals which will result in an inflow of Rs 517 crore foreign investment in the country. The finance ministry on Monday approved proposals recommended by FIPB.

According to a finance ministry statement, Indian Rotorcraft, a joint venture of AgustaWestland (a Finmeccanica company) and Tata Sons for setting up an assembly line for the AW119Ke helicopter, had sought post-facto approval for increased FDI inflow of Rs 19.64 crore as against Rs 17.6 crore approved in September 2011.

It had also sought approval for “change of the foreign investor from AgustaWestland S.P.A, Italy to Finmeccanica S.P.A by way of merger of AgustaWestland S.P.A, Italy into Finmeccanica S.P.A.”

Tata Sons and Italian defence major AgustaWestland had in February 2010 signed an agreement for formation of a joint venture company to establish a final assembly line for AW-119 helicopters for the Indian Army and the global market.

Tatas has previously said Indian Rotorcraft has “no connection whatsoever with AgustaWestland’s (AW) supply of AW101 military helicopters to the Government of India.”

There are allegations that helicopter-maker Finmeccanica and AgustaWestland paid bribes for securing the contract for supply of 12 AW101 military helicopters during the previous UPA regime.