Denel to resolve alleged blacklisting with India

South African arms manufacturer Denel has assured the government that it would resolve with India the vexed issued of its alleged blacklisting there, a news report said here Sunday.

This followed reports of reluctance by the South African government to intervene at a diplomatic level, as requested earlier by Denel.

South African National Defence Force chief General Godfrey Ngwenya told parliament Friday that Denel had failed to disclose to the government the reasons for its alleged blacklisting by the Indian government since 2005.

Denel never explained their problems with India," Ngwenya was quoted as saying by the weekly Sunday Times here.

Denel recently said it had lost two billion rands after India blacklisted it in 2005 for alleged irregular tendering processes, and sought further bailouts from government after three years of continued losses.

Defence Secretary Tsepe Motumi said Denel had given assurances that the matter would be resolved with the new government in India.

A change in the reporting line of Denel is also being mooted to avoid such a situation in the future.

Defence Minister Lindiwe Sisulu proposed that Denel report to her department rather than the Department of Public Administration, as was currently the case: Once we have Denel in the ambit of defence we won't have such problems.

Sisulu also supported a bid for the parastatal arms manufacturer to receive a capital injection from the government. "I am very sympathetic to Denel," the Sunday Times quoted her as saying.

We have been assured that they are restructuring. We have heard this before but we think we should give them the benefit of the doubt.

The amount of government funding that Denel is seeking remains unspecified at this stage, but it received two billion rands as well as 1.5 billion rands in loan guarantees in 2006. Last year Denel lost 348 million rands.

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( 320 Words)

2009-07-05-17:09:56 (IANS)

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