MR-SAM deal: IAI says story cooked up by foreign competitors

Tel Aviv: In a statement, clarifying its position on the medium range-surface-to-air missile (MR-SAM) deal Israel Aerospace Industries Ltd has categorically rejected claims that it delayed reporting a large transaction until receipt of the advance payment.

A company statement said, ''Israel Aerospace Industries Ltd. (IAI) does not release general information regarding transactions with its customers, except for such information as is required to be reported by law.

''Lately, various articles have appeared in the media regarding a large transaction for the sale of weapon systems to the country of a foreign customer, which have included information that is incorrect and biased, and which have originated, apparently, from entities that are trying to harm IAI's business ties with this customer.

''It was published, among other things, that notification regarding a large transaction for the sale of weapon systems to a foreign customer was delayed until receipt of the advance payment for such transaction, and this on the claim that representatives of that country's government requested that the notification be delayed.

''IAI's management wishes to make it clear that these claims and articles have no basis in reality and, in any event, have not emanated from IAI.''

It was reported in a section of Indian media that the MR-SAM deal, involving development and production of a 70-km range surface-to-air-missile, had been signed quietly days before the country's parliamentary elections were announced and, possibly, involved payment of hefty commissions to various parties.

The deal, signed in February, involves development and production of a land-based version of the Barak 8 missile systems. The sea-based version is already in advanced development stages.

The missile will be capable of intercepting enemy aircraft and missiles within a 70-kilometer range.

The deal was first reported in March after IAI officially announced the new contract to the Israel Securities Authority last week. Due to Defense Ministry regulations, IAI did not disclose the name of the foreign country involved or the product it was selling.

Following the notification to the Israel Securities Authority, media reports originating in India claimed that IAI withheld notification of the deal until it received an advance payment.

These charges are now being rebutted by IAI.

The Indian minister of defence has clarified that an anti-corruption clause is inbuilt into the contract and that any evidence of wrongdoing would result in the deal being annulled.

Some reports suggest the deal may possibly involve supply of up to 2,000 missiles.