Defence

India could issue a fresh request for proposals for 197 army light utility helicopters in early 2008, with industry sources suggesting the documents could be sent to manufacturers within a month.

"This procurement is now likely to be put on the fast track," says a New Delhi-based source close to the defence ministry. "Work has begun on the RFP, but the requirements have not changed and there shouldn't be much of a delay."

Bell Helicopter and Eurocopter are likely to receive the RFP once again, and Russian arms export agency Rosoboronexport could also be invited to respond. India is seeking 60 helicopters in a flyaway condition, with the rest to be licence-produced domestically.

New bids are being sought after New Delhi scrapped a $600 million deal with Eurocopter for the AS550 Fennec, ending seven months of exclusive negotiations and an almost seven-year process since launching the tender process.

Doubts were cast on the deal after it emerged that the EADS subsidiary had used the AS350 Ecureuil - the civilian version of the AS550 - during 2005 flight trials. An official in the company's Indian agency is also related to a senior member of the selection committee, leading to accusations of a possible conflict of interest. Protests also came from Bell and the US government, who said the Bell 407 was unfairly disqualified in early 2007.

Repercussions from the cancellation continue, with Eurocopter having held an inquest and European diplomats continuing to raise the issue. France is particularly rankled because it had hoped the deal would be signed during President Nicolas Sarkozy's January visit to India.

The Indian defence ministry and army could also conduct investigations into the affair, especially since defence minister A K Antony has recently insisted on utmost transparency in military deals. There has also been speculation that action could be taken against the officers who overlooked the problems during the trials process.

New helicopters are urgently needed to replace the army's Hindustan Aeronautics-built Chetak and Cheetah aircraft, many of which date back to the 1960s. The army is reported to have lost 11 of the aircraft - which are used mainly for transport, evacuation and reconnaissance tasks - since 1999.