Sagem Lowers Bid to Euro
43,500 Each Unit
or a total of $47.6 million on June 30, 2005
Army's
Budding Mansurul Haq Pays Extra $21m in Hush-Hush French Deal
By
M T Butt
ISLAMABAD,
June 30: For the first time in Pakistan Army’s history,
intimate details of a multi-million dollar weapons deal have been
leaked to the media by angry middle ranking officers who point
to a massive scandal which has already left the Ministry of Defence
and most of the senior officers in the GHQ wondering how bold
and blatant some people can get.
These
officers have released all the details, including names, places,
time and dates about the deal, raising a plethora of questions
about the manner in which specialized defence equipment is being
purchased in a blatantly roughshod manner, without any financial
oversight. They say if no action was taken now, more details of
many more scandals would also be made public including some personal
scandals of Generals which many would not like.
According
to an expert, who has studied Pakistan military purchases for
years, such deals and over-payments are a very common occurrence
in the Pakistan Army but what is new and different in this case
is that the details have been leaked to the media for the first
time while the deal is still in the process of being wrapped up.
“These
officers cannot reconcile with the fact that an extra 21 million
dollars are being paid to a French company in extra-ordinary haste
and that too to buy inferior quality equipment already discarded
by most countries, including Pakistan Army itself,” an E-Mail
received by the South Asia Tribune disclosed.
The
details of the deal are bizarre and the two top most Army Generals
under General Musharraf are being named as the interested parties
who are forcing the violation of all rules and regulations. Both
are due to retire in 2007 and one of them may survive to become
the Army Chief as well.
“This
violation is happening in the Army Headquarter right now and can
possibly be stopped if General Musharraf or the helpless politicians
occupying the posts of the Defence Minister or the Prime Minister,
intervene and stop these Generals from making quick money at the
expense of national defence and even country’s exports,”
a concerned official said.
According
to the details, a quick fire, Restricted Tender was floated on
June 17, 2005 by the Director General of Defence Purchases seeking
to buy 900 Thermal Image Sight (TIS) Fire Control System Units
(Pix Above) for the main Pakistani battle tanks – Al-Khalid
and Al-Zarrar, T-85 & T-80U.
Surprisingly
for such a large purchase through Tender No: 1338/49/TISight/DGDP/PC-3B
Dated 17th June, 2005, only four days were given for submission
of bids. June 21 was set as the last date.
This
was ostensibly done because the Weapons and Equipment Directorate
(W&ED) of the Army GHQ in Rawalpindi, had already pre-qualified
and short-listed two French companies, through a long process
of tests, trials and final technical evaluation by the ITD-Directorate
and I&E Directorates in the first week of June, 2005. So both
the companies were practically ready to bid.
These
companies were Sagem and Thales, the first being Europe's third
largest defence and security electronics company, while Thales
is France's largest military company. Adnan, son of late Maj.
Gen. Jamsheed Malik represents Sagem in Pakistan while Thales
is represented by a Colonel Wazir and Mr Shibli from F.A. Enterprises.
The
tests and trials had included draft contract proposals, including
commercial and technical offers, which were sought by the W&ED
on May 24 and May 26, 2005 from these two companies. Both gave
their offers and both were pre-qualified/short listed by GHQ.
Then
the W&ED sent the files to DGDP for final purchase contract
before June 30, 2005. DGDP floated the tender asking for bids
in 4 days. Both Sagem and Thales separately submitted their technical
and commercial offers on June 21 in the presence of DGDP and their
own representatives.
First
the technical offers were opened and evaluated by the technical
departments, I&E and ITD Directorates of GHQ and after two
hours both were declared technically qualified with 4 technical
observations made on Sagem’s offer and 35 technical observations
on Thales bid.
The
most significant difference in the two offers was that Sagem bid
for the Generation-3 (G-3) TIS Units while Thales offered the
older Generation-2 (G-2). The Tender had asked for both types
although G-2 is almost obsolete.
Why
were G-2 units put on the tender is a big mystery because Pakistan
Army has already been using the G-3 which are mounted on Al-Khalid
tanks being manufactured by Pakistan for which Islamabad and the
GHQ have been trying hard to secure export orders from the Gulf,
Saudi Arabia and other countries.
The
angry Army officers say G-2 units were not being mounted on Al-Khalid
tanks because of integration, stabilization and target identification
problems. In all the demonstrations to potential foreign buyers,
the GHQ has been displaying Al-Khalid tanks with G-3 units.
Side
by side, the Pakistan Air Force has upgraded all the F-16, Mirage
and Helicopter Gunships with G-3 units bought in 2001 or thereafter.
These were purchased from Sagem in 1997. Sagem is also the main
contractor in collaboration with Kamra Avionics Company. It introduced
Kamra to the international export market for which General Musharraf
is said to be very proud and keeps referring to.
All
NATO armies and Russians are using G-3 because it is light weight,
has no payload problems on air and is more reliable than G-2.
In 2002 the Pakistan Army GHQ and Weapons and Equipment Directorate
decided to install G-3 in all its main battle tanks.
Sagem
was also offering transfer of technology which is included in
the quoted price along with state-of-the-art Technical Ugradation
Package to upgrade all the existing tanks from G-2 to G-3. That
in itself promises a huge export market.
Thales,
on the other hand, was not even a qualified supplier until early
2004 and only Sagem was in the run. Then came General Tariq Majeed,
the Chief of General Staff with his background of Military Intelligence
(MI). He ordered that Thales should also be included in trials
and tests which continued until November last year. More trials
were done in February/March this year until Thales was pre-qualified,
although it was offering only G-2 Units.
The
big envelopes of bids were opened on June 21, 2005 after the technical
offers of both the companies were approved. Lo and Behold, Sagem
had offered each G-3 TIS unit for 59,000 Euros or a total of 53.1
million Euros (US$64.5 million) for 900 units. The price of Thales
was an unbelievable 78,000 for each G-2 unit or a total of 70.2
million Euros (US$85.3 million).
On
Thursday June 23, 2005, Lt. Gen. Tariq Majeed, Chief of General
Staff took the decision, with the knowledge of the Vice Chief
of Army Staff, General Ahsan Saleem Hayat, ruling out all technical
and other objections to give the contract to Thales, the highest
bidder, for its inferior G-2 equipment.
His
decision was given on the last day of his work as Gen Majeed proceeded
the very next day on an official trip abroad.
The
decision stunned many who were involved with the project. There
were so many angry officers who found it unpatriotic to keep quiet.
Some of them believe the use of brute authority to reward a company
which did not offer competitive technology has created a big problem
for General Majeed who is being likened to Admiral Mansurul Haq
of Pakistan Navy, the convicted former Navy Chief who made millions
in submarine purchase deals and paid off a tiny percentage to
get off the hook.
The
Ministry of Defence has been kept totally out of the loop in the
deal. All the files were kept under control of the GS Branch headed
by General Majeed. But there were other Generals heading other
Directorates involved, who had to agree.
These
Officers and Directorates included Director General Armored Corps,
Maj. General Saeedullah Khan, DG Weapons & Equipment Directorate
Maj. Gen. Ejaz Bakhshi who was assisted by Brig. Zawwar Shah.
The Military Operations Directorate under Major General Yousuf
and his Technical Director Brig. Khalid Asghar also had to approve
the purchase. The ITD Directorate was also involved.
The
angry officers of the Army say all these Generals and Brigadiers
were put under severe pressure to approve the deal. “Maj
General Ejaz Bakhshi was under tons of pressure, so was Major
Gen. Yousuf but Technical Director Brig. Khalid Asghar was so
terrorized he was almost crying, but he had obey the orders to
keep his job and secure a pension,” one officer recalled.
The
reason is that General Majeed is the senior most General after
the current Vice Chief of Army Staff, General Ahsan Saleem Hayat,
who retires in October 2007. General Majeed has the outside chance
of becoming the Army Chief as he is due to retire on December
30, 2007 and could thus be a possible replacement of General Musharraf,
if he is not kicked out earlier.
The
Editor of the South Asia Tribune contacted the Thales
company through its given Email on its web site to confirm the
deal. An Email sent to 'tosasales@fr.thalesgroup.com' asked Thales
whether it had finally got the contract from Pakistan Army of
900 Thermal Imagers at Euro 78,000 per unit for Pakistan’s
Main Battle Tanks.
Thales
was also requested to confirm whether the TIS Units were of Catherine-QW
type, whether the imagers were Generation-2 or Generation-3 and
whether Transfer of Technology (ToT) was also part of the contract.
No response was immediately available from the company.
The
decision to buy G-2 units from Thales has many implications for
the Army and Pakistan as well. Firstly Pakistan will be paying
an extra US$21 million to buy inferior grade technology which
is being phased out by all the armies the world over, including
the Pakistan Army.
Secondly
by putting in these old Generation units, Pakistan is seriously
going to compromise its export potential for Al-Khalid and other
tanks as all buyers are looking for the latest technology when
they purchase weapons at such a scale.
Thirdly
after a few years Pakistan will in any case have to upgrade these
tanks and install the new technology which would again cost a
bundle to the Army and the country.
Why
all this blatant favoritism is being done by some Generals is
obvious but no one is still ready to give out a guess of what
will happen to the new Admiral Mansurul Haq in the making.
What
it, nevertheless, proves is that General Musharraf has turned
a totally blind eye on whatever his key position holders in GHQ
may be doing because he wants them to stay happy, healthy, wealthy
and content and not challenge his authority as the Army Chief,
although he has crossed his retirement age years ago.
