India bans Finmeccanica from bidding contracts after graft allegations

New Delhi: India has banned Finmeccanica group of companies from bidding in contracts, a defence ministry source said on Tuesday, as it presses on with an investigation into a scrapped helicopter contract with the Italian firm.

Finmeccanica declined to comment.

In January, India cancelled a 560 million euro ($751 million) order with Finmeccanica's unit AgustaWestland for 12 top-end helicopters after Italian prosecutors alleged the defence group had paid bribes to Indian officials to win the contract.

"Where a tender process is yet to commence, a company under the Finmeccanica group of companies should not be given tender papers for purposes of bidding," a defence ministry source said, setting out new rules for dealing with the firm.