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India Slaps 10-Year Ban on Israeli Defense Company

Defense Ministry officials are consulting with Israel Military Industries Ltd. on how to respond to Delhi's decade-long ban on defense bids.
By Gabe Kahn.
First Publish: 3/7/2012, 6:10 PM

Israeli UAV
Israeli UAV
Flash 90

Israeli officials said they were “surprised” at a ten-year ban slapped on Israel Military Industries Ltd., barring the company from competing for Delhi’s defense contracts.

India announced on Tuesday it was blacklisting IMI and five other firms from India, Switzerland, Russia and Singapore, over allegations of bribing an Indian official to win contracts.

India's Ministry of Defense froze all contracts signed with the six companies in May 2009, when the scandal came to light.

Delhi officials also say they only made the decision after giving the companies a chance to respond to the allegations.

A statement Wednesday by Israel's defense ministry said IMI had "very good claims" against the Indian allegations.

India is a key market for Israeli defense companies. The ban could cost IMI billions in defense contracts.

IMI, a government-owned company, is the IDF’s main manufacturer of defense platforms for land, sea and air forces, and has several international clients.

Israel's defense ministry, however, has said it is considering privatizing IMI, and that it will consult with the company about how to respond to the Indian ban.