European Defence Minister Resigns Over ₹769-Crore Arms Deal; Indian Company’s Name Emerges

Estonia’s Defence Minister Hanno Pevkur has resigned, taking moral and political responsibility after an audit raised serious questions over a €70 million (around ₹769 crore) ammunition deal involving an Indian-owned company. The contract, intended to support Ukraine, became controversial after concerns emerged over the quality of the ammunition and the decision to award the deal to a firm with no previous experience in weapons manufacturing.

Indian-Owned Firm Received €70 Million Advance

In 2024, Estonia’s Centre for Defence Investments (RKIK) signed an agreement with an Italy-registered company called Datasel to supply ammunition for Ukraine.

The company is owned by India-based Neko Defense Munitions. Under the agreement, Datasel received an advance payment of €70 million, with the funds coming from the European Union.

Quality Concerns Trigger Contract Dispute

The ammunition was delivered to Estonia in 2025 after a significant delay. An investigation subsequently found that the ammunition did not meet the required quality standards, according to the allegations outlined in the source material.

Estonia cancelled the contract and sought the return of the money. Datasel has disputed the claims, saying it delivered goods worth €59 million on time and that the ammunition had no quality defects. The company has also claimed that the Estonian agency was unable to accept the remaining goods.

The dispute over the €70 million has now reached an international arbitration centre in France.

Audit Flags Decision To Award Contract

Estonia’s National Audit Office also questioned how the contract was awarded. Elmer Vaher, Director General of the Defence Investment Centre, acknowledged that awarding such a large contract to a company that had never manufactured weapons was a major mistake.

The audit warned that if the money is not recovered, the financial loss could ultimately have to be covered from the Estonian government’s own budget.

Defence Minister Steps Down

Pevkur, who has served as Estonia’s Defence Minister since 2022, decided to resign following the audit findings and concerns over wider systemic failures.

The Estonian Prime Minister said Pevkur was not personally responsible for the disputed deal. However, the minister chose to step down, saying he was accepting political responsibility for the shortcomings in the system.

Pevkur also stressed that Estonia’s security is a shared responsibility and that continued support for Ukraine remains essential to Estonia’s own security.