India lifts trade ban on Leonardo

The Indian Ministry of Defence (MoD) has revoked a long-standing defence-trade ban on Leonardo. A notice issued by the MoD on 12 November confirms that the Italian firm has been removed from its trading blacklist.

The ban was introduced in 2014 over allegations of corruption linked to India's terminated contract to procure 12 AgustaWestland AW101 helicopters for the Indian Air Force's VIP transport requirement.

The suspension had previously applied to AgustaWestland International UK and its parent group Leonardo. The MoD notice shows that both entities have now been removed from a list of firms that are “suspended from doing business with the MoD”.

Leonardo told Janes that the company would not comment on the lifting of the ban.

The MoD has not elaborated on the decision. However, according to unconfirmed reports, the lifting of the ban was a subject of bilateral talks between Indian Prime Minister Narendra Modi and his Italian counterpart Mario Draghi in late October.

Leonardo and the Indian MoD have also previously been involved in arbitration proceedings. The new decision is also reportedly subject to legal conditions.

The AW101 contract – valued at about USD764 million – remains subject to investigation by India's Central Bureau of Investigation (CBI) but no charges have been brought against the Italian defence group. The investigation has been under way since early 2013.

The MoD's newly issued trading blacklist also shows that 23 Indian and overseas defence firms continue to face bans and restrictions on supplying equipment to the Indian armed forces.