The CAG in its report tabled in Lok Sabha said IAF procured 17 engines in 2007 and 100 engines in 2009 for the Antonv-32 transport fleet.
"IAF had paid USD 719,500 (Rs 3.16 crore) per engine against the contract of June 2007, whereas, it had to pay USD 10,90,000 (Rs 5.43 crore) per engine against the contract of December 2009. Thus, IAF had to incur a total of Rs 227 crore extra on procurement of 100 aero-engines," it said.
The government auditor said, "Despite being aware of long-term requirement of aero-engines, IAF failed to project the entire requirement which resulted in the extra avoidable expenditure."

An-32 is a medium tactical transport aircraft used primarily by the Air Force for transportation of the troops and cargo, para-trooping and casualty evacuation.
India had signed a contract with Ukraine for upgrading the fleet of 105 aircraft of which 40 were to be developed in Ukraine and the remaining were to be modernized in IAF facilities in Kanpur.

"Due to delay in initiation and conclusion of the contract, facilities for upgradation of an aircraft could not be set up in time despite an investment of Rs 272 crore on Transfer of Technology resulting in grounding of more than 50 percent of the transport aircraft fleet," he said.

The CAG also rapped the Navy for failure to synchronize the procurement of spares with the refit of a submarine coupled with delay on the decision to procure 204 types of spares in 2006, which affected the quality and completeness of the refit of the submarine.
"Besides, procurement of 89 spares at a later date led to an extra expenditure of Rs 18 crore," it said.

The refit of the submarines of the Navy had come under the scanner recently after the sinking of the INS Sindhurakshak submarine in Mumbai harbour on August 14, last year, resulting in the death of all 18 sailors on board.

The report stated that the scrutiny of 24 projects aimed at achieving indigenization, undertaken by the Navy-affiliated DRDO laboratories at a cost of Rs 731.51 crore, revealed that
21 projects that is 87 percent did not adhere to the original time frame for completion.

"Seven projects witnessed cost overruns ranging from 34 to 348 percent. Scrutiny of 12 projects related to critical naval technologies, showed delays, technological obsolescence, difference of perceptions between Navy and DRDO on success criteria," it said.
The government auditor said the frequent changes in qualitative requirements by Navy contributing to failure in induction of indigenously developed capability.

The CAG also criticized DRDO for irregular allotment of office space to a private organization leading to a revenue loss of Rs 5.67 crore to the government exchequer.


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