VOI World/ Desk
Estonian Defence Minister Hanno Pevkur has resigned after a failed €70 million ammunition procurement deal for Ukraine triggered a major political controversy, with an Indian-owned defence company at the centre of the dispute.
The deal involved Datasel SRL, an Italian-registered company acquired by India’s Neco Defence Munitions in 2024. Estonia had signed contracts with the company to procure artillery shells for Ukraine using funds from the European Union’s European Peace Facility.
According to reports, Estonia made large advance payments totalling around €70 million. However, the procurement later came under scrutiny over delays and concerns regarding the ammunition supplied. Estonia’s National Audit Office criticised aspects of the country’s defence procurement, while the Prosecutor’s Office opened a criminal investigation into the process.
Pevkur announced his resignation on September 2, saying he was taking political responsibility for the controversy. He maintained that defence ministers do not normally handle the details of individual contracts but said the findings raised the question of ministerial responsibility.
The controversy centres on the selection of Datasel, which reportedly had no previous track record of selling artillery shells when the contracts were signed. The deal was intended to help address Ukraine’s ammunition shortages during its war with Russia.
Estonian authorities later terminated the contracts and are seeking to recover funds through legal proceedings and international arbitration. However, the supplier has disputed Estonia’s allegations and challenged the termination of the agreements.
Neco Defence Munitions, the Indian company linked to Datasel, has also contested reports surrounding the deal. A representative of its parent group said ammunition had been supplied following quality checks by Estonian officials and claimed further contracts were subsequently awarded before being halted.
The case has become a significant political setback for Estonia, one of Ukraine’s strongest European supporters. It has also drawn attention to the risks facing European governments as they accelerate defence procurement to replenish Ukraine’s ammunition supplies.
