Tuesday, March 21 2006 14:51 Hrs (IST) - World Time -

New Delhi: Rejecting allegations of middlemen and kickbacks in the Scorpene submarine deal, Government today(Mar 21,2006) said it had succeeded in bringing down the costs by Rs.313 crore and signed 'integrity pacts' to ensure transparency.

Dismissing charges by Opposition leaders and former Defence Minister George Fernandes that middlemen were involved in the deal and an extra amount of Rs.4,500 crore was paid to the French firms than was earlier negotiated, Defence Minister Pranab Mukherjee said "The facts of the case are contrary to these allegations".

Making a suo motu statement in Lok Sabha, he made it clear that "no contract or contracts were signed with French firms for Rs.16,000 crore for the Scorpene project" as alleged by the Opposition and also a section of the media.

Mukherjee said the total cost of the two contracts signed with the two French firms M/S ARMARIS and MBDA for the project was Rs.7,197 crore.

"The Government did not pay an extra amount of Rs.4,500crore that what was negotiated earlier. On the contrary, after the present Government came to power, it re-examined the project even though all negotiations had been completed in 2002 and the Ministry of Finance had accord ed approval to the project in 2003," he said.

The UPA Government held negotiations and "was able to achieve a reduction of Rs.313 crore from the negotiated position in 2002," he said.