India’s decision to ban Italian defence conglomerate Finmeccanica may prove costly for India

India’s decision to ban Italian defence conglomerate Finmeccanica and its subsidiaries from bidding for defence contracts drew a strong response from the United Kingdom with its key interlocutor hinting at 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, said. He did not go into the details of the ban the Ministry of Defence is considering against the Finmeccanica as the case involves policy decisions of the government. The ban is likely to affect all its subsidiary companies as well.

Mr. Swire discussed the issue of U.K. citizens in Tamil Nadu jails as well as the immediate issue of human rights in Sri Lanka during discussions that lasted over an hour with Minister of State for External Affairs Gen. V.K. Singh. “I will travel to Chennai tomorrow [on Tuesday] and will meet the Chief Minister,” he said referring to the issue of ex-soldiers from the U.K. who are in a prison in Tamil Nadu.

Supporting the international approach to the human rights situation in Sri Lanka, Mr. Swire said President Maithripala Sirisena and Prime Minister RanilWickremesinghe were yet to fulfil the commitments they made to the international community.

Mr. Swire said the political deadlock in Nepal was of significance to the U.K. “We are a huge donor of aid to Nepal and have a very strong link through the Gurkhas who serve in the British Army. So we want the government of Nepal to be a comprehensive government which takes into account different parts of Nepal and brings stability to the country so that they can bring economic stability,” Mr. Swire said.

Highlighting security and regional cooperation in South Asia, Mr. Swire said the rise of terrorism in Bangladesh was of concern to the U.K.

“We spend a lot of money in Bangladesh and we can work together to contain the threats, but obviously we have some problems in Bangladesh.”

Mr. Swire said the U.K. was interested in ensuring that the ruling of the UNCLOS should be adhered to regarding the South China Sea. “Rules-based international system is an incredibly important thing, not least for the South China Sea where a huge percentage of global shipping passes through at any given time,” he said.

By – Nikita Goel