Doubts over India helicopter deal

By Damian Grammaticas
BBC News, Delhi

India denies that the deal has been scrapped

A $600m deal India has been negotiating with the European aircraft manufacturer EADS for new military helicopters has been thrown into doubt.

A spokesman for India's Ministry of Defence told the BBC the contract is to be opened to other bidders.

The move is a setback for EADS, which also makes the Airbus family of commercial jets.

The deal is part of a huge military modernisation programme being undertaken by the Indian government.

New equipment ranges from fighter jets to aircraft carriers in what is one of the largest arms purchases of its kind currently being negotiated.

Process 'broadened'

Some six years in the making, this deal for military helicopters was almost in the bag for the European consortium Eurocopter.

Last February, Eurocopter, whose parent company EADS also makes Airbus airliners, was chosen by India's army to provide 197 new helicopters.

The Eurocopter had been through field trials, but negotiations over the final price were outstanding.

Now, though, a spokesman for India's Ministry of Defence has told the BBC that the selection process is being "broadened" as other companies complained they had not been given a proper chance to win the contract.

He denied that Eurocopter's bid was being scrapped; it could still emerge as the preferred choice, he said, but India wanted to be sure of selecting the best helicopter possible.

However, the process of seeking new tenders could set the deal back by months, even years.