Archive · 4 Sep 2026
Indian-Owned Firm at Center of Estonian Ammunition Scandal
Estonia paid a company called Datasel to provide artillery shells for Ukraine.
The money came from a European Union fund.
Datasel had been bought by an Indian company called Neco Defence Munitions.
Estonia paid about €70 million in advance.
The deliveries were late, and Estonia said some ammunition did not meet its standards.
Estonia cancelled the contracts and the issue went to court.
Defence Minister Hanno Pevkur resigned and said he was accepting political responsibility.
Datasel says it was the victim and that the main problems involved delayed approvals, not poor quality.
The company also says it supplied and invoiced almost as much material as the amount it received in advance.
Estonian Defence Minister Hanno Pevkur resigned, saying he was taking political responsibility for a defence procurement controversy.
Estonia signed contracts with Italian company Datasel SRL to supply artillery shells for Ukraine using European Union funds.
Datasel received advance payments totaling roughly €70 million, but deliveries were delayed and Estonia said some ammunition failed required standards.
Datasel was acquired by Nagpur-based Neco Defence Munitions and had limited previous experience producing the requested artillery shells.
Datasel disputes Estonia’s grounds for cancelling the contracts, saying delays involved regulatory approvals and that no quality problems were established.
- Who
- Estonian Defence Minister Hanno Pevkur, the Estonian Centre for Defence Investments, Datasel SRL, and Neco Defence Munitions.
- What
- A dispute over cancelled ammunition-supply contracts for Ukraine and advance payments totaling roughly €70 million.
- When
- The first contract was signed in August 2024, a second in October 2024, and Pevkur announced his resignation on Wednesday.
- Where
- The contracts involved Estonia, an Italian company, an Indian owner based in Nagpur, and ammunition intended for Ukraine.
- Why
- Estonia cited delivery delays and alleged failures to meet required standards, while Datasel attributed delays to regulatory approvals and disputed the termination.
Estonian Authorities
Datasel SRL
Reason for contract cancellation
Estonian Authorities
Estonia said deliveries were delayed and that some ammunition received did not meet the required standards.
Datasel SRL
Datasel acknowledged delays but said they were linked to approvals, authorisations, clearances, and documentation rather than ammunition quality.
Responsibility for the dispute
Estonian Authorities
The Estonian government cancelled the contracts and Pevkur accepted political responsibility for the procurement controversy.
Datasel SRL
Datasel said it was the victim, had suffered losses, and considered the reasons for extraordinary termination contradictory and illogical.
Ability to fulfil the deal
Estonian Authorities
Estonia contracted with a supplier that, according to reporting, had no previous experience with this type of artillery-shell contract.
Datasel SRL
Datasel said it could have met all its obligations if Estonia had not ended the contracts.
- Defence minister
- Hanno Pevkur, Estonia’s defence minister since 2022, resigned while taking political responsibility.
- Supplier
- Datasel SRL, an Italian company acquired by Nagpur-based Neco Defence Munitions.
- Purpose
- The contracts were intended to supply artillery shells to Ukraine.
- Funding
- The purchases used money from the European Union’s European Peace Facility.
- Advance payments
- Estonia’s payments to Datasel eventually totaled roughly €70 million.
- Contract dispute
- Estonia cancelled the contracts; Datasel argues it could have fulfilled its obligations and is challenging the termination in court.
- Datasel response
- Datasel says it supplied and invoiced €58 million worth of material against €59 million in advance payments and that inspections established no quality problems.