Indian premiere defence research arm Defence Research and Development Organisation's (DRDO) $208 million deal with Brazilian aircraft manufacturer Embraer has come under the scanner for bribery. The deal was signed in 2008.
The probe, undertaken by Brazilian and U.S. prosecutors, was extended to Embraer's sales to India and Saudi Arabia over allegations that the company paid bribes to swing the deal in their favour, Brazilian newspaper Folha de SaoPaulo reported on Friday.
According to reports, the aircraft manufacturer used middlemen from the U.K to get the deal and paid commissions for the same. Indian defence procurement policy bars hiring such unauthorised agents.
The deal with India was signed by the previous UPA government and included the purchase of three EMB-145 jets. These jets were for the DRDO to equip with indigenous radars for IAF's airborne early-warning and control systems (AEW&C) requirement.
"DRDO to seek explanation & details from manufacturers of Embraer aircraft on media reports on deal for the aircraft signed in 2008," the defence ministry said in a statement. "On receipt of information by DRDO further steps may be initiated."
Embraer has been under the scanner after U.S. launched a probe in 2010 under the Foreign Corrupt Practices Act (FCPA). The probe then led to the arrest of the defence minister of the Dominican Republic in August over bribery allegations.
Embraer is reported to be co-operating with the authorities. The company has a big presence in India with a total of 28 aircraft of different market segments. It had previously provided VVIP executive jets to the Indian Air Force.