Exclusive: Czech Prime Minister asks PM Modi to remove the ban on Tatra trucks

Andrej Babiš, the Prime Minister of Czech Republic, has appealed to Prime Minister Narendra Modi to remove the name of Czech truck manufacturer Tatra from the Ministry of Defence's restricted list of suppliers.

"We want that Tatra no longer remains on the list of banned (restricted) companies," Babiš told National Herald in an exclusive chat in New Delhi on Saturday.

The Czech PM was on a two-day visit to India and attended the inauguration of the Vibrant Gujarat Summit on Friday. The visiting leader held consultations with PM Modi on the sidelines of the summit.

"I was asking your Prime Minister to help us with this old story of Tatra. There were a few owners who faced a few problems a few years ago," said Babiš.

The Czech PM noted that Tatra had been supplying spare parts to state-owned Bharat Earth Movers Limited (BEML). He also said that once the issue was sorted, the Czech government was also ready to "increase the defence cooperation in the private sector."

The manufacturer of all-terrain trucks, from sizes 4X4 to 18X18, Tatra was at the centre of a Central Bureau of Investigation (CBI) probe in 2012 after then Indian Army chief General VK Singh (now, Minister of State (MoS) for External Affairs) alleged that the trucks were reaching the Indian Army through a London-based intermediary, therefore leading the Army to pay 100 to 120 per cent more per truck on the factory price.

While General Singh's allegations didn't stand a CBI probe and the investigative agency filed a closure report in the case in August 2014, citing lack of evidence, the Czech-based company found itself on the restricted list of defence suppliers. "The CBI closed the case on the grounds of insufficient prosecutable evidence," an agency spokesperson had said back then.

The restrictions on Tatra continue to this day, with a Ministry of Defence circular dated Feb 19, 2018 listing the company among its list of firms from which only "restricted procurements" are allowed.

"It has been decided that M/S BEML Ltd may be permitted to engage with and procure parts from M/S Tatra Trucks, the aggregates, components and parts for Tatra vehicles, only if such procurement are justified and necessary on the basis of operational insurgency, national security and non-availability of other alternatives, to be certified in writing by the user agency at the level of PSO," the Union Defence Ministry's circular read.

Sources at the Czech Embassy in New Delhi told NH that Tatra was likely to be removed from the list of restricted companies in the defence ministry's records this year. "We will also supply orders to BEML," sources added.

Indian Army has been using various models of Tatra trucks for various purposes such as transporting personnel, tanks and missiles.

Even as it had been facing government restrictions, Tatra entered into a joint venture wil India-based Reliance Defence on a 51-49 partnership, with the Anil Ambani-backed company owning the majority stake, as reported by Economic Times in July last year.

The Reliance-Tatra deal at the time was one of the first foreign joint ventures in the defence sector after the relaxation of FDI norms by the Modi government months before. It is believed that the Relaince-Tatra venture is a major player in the Rs 3,500-crore market to service the needs of India's security and nuclear forces.

Besides the Czech government, the push to remove restrictions from Tatra is also believed to be backed by Reliance Defence, which is also in the process of setting-up a production facility for the trucks at the Dhirubhai Ambani Defence Park in Maharashtra, it has been learnt.

Earlier in the day, Czech PM Andrej Babiš called on President Ram Nath Kovind. President Kovind said that, along with economic partnership, “defence is a key pillar of India-Czech bilateral relations.”