Losing India business is no big deal, says Finmeccanica

Italian defence supplier Leonardo Finmeccanica has threatened to reassess its business in India, a few days after New Delhi said it would blacklist the company over the alleged payment of bribes to win a large helicopter contract.

Former executives of the state-controlled conglomerate were found guilty last month after being tried in Italy on corruption charges relating to a €560-million ($624 million) contract in 2010 to supply a dozen helicopters to the Indian government for VVIP transport.

Finmeccanica has distanced itself from the allegations, saying the case is against  individuals rather than the company, but India's defence minister said the company would be banned from future government tenders.

Manohar Parrikar made the comments after India's top court allowed an Italian marine accused of murdering two fishermen to be freed and flown back to Italy in another case that has soured relations between the two countries (See: SC okays Italian marine Girone's return to Italy).

Responding to the minister's comments, Finmeccanica issued a statement saying that its business in India is "very marginal".

"The company hopes that an agreed and transparent solution is found as soon as possible to shed light on current initiatives and future business opportunities," it said.

"Should this not be the case, the company will not refrain from assessing the situation given the limited size of ongoing business in the country."

Since his appointment in May 2014, Finmeccanica chief executive Mauro Moretti has worked to improve the company's reputation and streamline the organisation to increase transparency.

 In its statement on Monday the defence group stuck to its previous full-year guidance of €20 billion in orders and core profit of €1.22 billion to €1.27 billion, saying that new Indian orders have not been included in its budget forecasts over the past few years.

The United Kingdom too stepped into the debate on Monday, with a key interlocutor saying India's decision to ban Finmeccanica and its subsidiaries from bidding for defence contracts would result in the Indian military losing out on some cutting-edge military hardware.

''There are some companies within the Finmeccanica group that make extremely good aircraft, which I know have been of past interest to the Indian Air Force. What happens in terms of India's procurement is up to India. But we obviously believe that the United Kingdom makes some products that may be of interest to India,'' Hugo Swire, Minister of State in Charge of Foreign and Commonwealth Office, told The Hindu in an exclusive interview.