Embraer bribery scandal
Embraer's 2008 deal with India is under the scanner for bribery allegations. In Picture: An Embraer R-99 aircraft fitted with Airborne Early Warning and Control System developed by India at the Defence Research and Development Organization takes off at Sakir airbase during the Bahrain International Air Show, Jan. 17, 2014.Reuters

The Indian defence ministry has asked the Central Bureau of Investigation (CBI) to investigate bribery allegations in Embraer's deal with the Defence Research and Development Organisation (DRDO) for three Emb-145 aircraft, which was struck in 2008.

The government is also expected to take stringent action against the Brazilian company if malpractices are proved. The company might either be fined or blacklisted, depending on the gravity of the crime.

India will use diplomatic channels to seek information on the case from the United States and Brazil, the Times of India reported.

The Embraer deal, worth $208 million, was inked during the rule of the previous UPA government.

A Brazilian newspaper had reported a few days back that prosecutors in Brazil and the U.S. had extended probe regarding corruption in Embraer's deals with India and Saudi Arabia. It was alleged that the company hired an agent to swing the deal.

The Brazilian aircraft manufacturer is alleged to have paid commissions to the middleman. India's defence procurement policy bars hiring such unauthorised agents. 

Defence minister Manohar Parikkar on Saturday directed DRDO to pursue Embraer for explanation and details on the issue. DRDO and the Centre for Air Borne Systems (CABS), DRDO's Bengaluru-based lab, have asked Embraer to respond within 15 days.

The files on the deal have been opened by the defence ministry and the DRDO.

The three Emb-145 jets are currently undergoing tests and are supposed to be integrated with the indigenous airborne early-warning and control systems (AEW&C) radars for the Indian Air Force (IAF).

Embraer came under the scanner for alleged corruption and kickbacks paid to get the aircraft deals through. The U.S. launched a probe in 2010 under the Foreign Corrupt Practices Act (FCPA). 

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