Murphy's Law: Bribes Break Bonds With India

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March 17,2008: Israel is in danger of losing its biggest customer for weapons. Over the last six years, Israel has sold nearly five billion dollars worth of arms to India. The biggest single item, with sales of nearly half a billion dollars, has been the Barak anti-missile systems for ships. The Barak system uses small missiles to shoot down incoming anti-ship missiles. Israel weapons have a solid reputation for reliability and effectiveness. Israeli success in several wars adds to the appeal of their armaments. U.S. and Israeli arms manufacturers often work together, which also gives Israel an edge when selling their equipment.

But yet another Indian corruption investigations uncovered what appears to be large bribes paid to Indian officials, to make those Barak sales happen. That cast a shadow on a deal, from last year, when India and Israel agreed to work together to develop a longer range version of the Israeli Barak anti-aircraft system. The new system (Barak II) would have a range of 50 kilometers, and take five years to develop. India and Israel were to split the $300-400 million development costs, and the new system will be used by both countries, and sold to others as well. But now Barak II is on hold, and the details of the financial arrangements being closely scrutinized.

 


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