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Millennium Post

Striking the right deal?

The year was 1980. Indira Gandhi had just returned to political power, elected by the same people who had thrown her out three years ago, for her decision to impose authoritarian internal Emergency in 1975.

India was in negotiation with the German firm, HDW for four submarines. The man who was brokering the deal was a former war hero of the 1971 Bangladesh operations, now the late Admiral S M Nanda. Sanjay Gandhi, the prime minister’s youngest son, wanted a larger share of the commission cake from Nanda. But the wily admiral went to the mother and requested her to restrain her uncontrollable son. Arms agents were functioning legally then.

The folk-lore in New Delhi remembered that the Nanda stratagem piqued the already berserk, Sanjay Gandhi so much, he manipulated the levers of power to declare arms brokering illegal in the country. That was possibly his last act before he died in a plane crash the same year. That was the beginning of criminalisation of the process and a demarcation of a huge area of discretionary power in the armoury of the politician, bureaucrat and the military hierarchy.

While Sanjay Gandhi died the way he lived: high strung, high adrenalin and high powered, the next Nehru-Gandhi scion, Rajiv Gandhi was a quieter man, who was a moderniser at heart. Even when Indira Gandhi was alive, she had inducted another Nehru, in her charmed circle. Arun Nehru was a corporate honcho who virtually made Sitaram Kesri, the Congress Party’s officially anointed treasurer, redundant.

So, when Rajiv Gandhi inherited the mantle of the country’s prime ministership after his mother’s assassination, he was in the thrall of sharp-shooter Nehru. Again, the breeze that whispers through the corridors of power in the main official seats of the country’s government tell tales.

Nehru apparently sold an idea to Rajiv. He told him that the best way to keep oneself clean and corruption-free is to ban the domestic fund raising activities of the political parties. This would starve the opposition of much needed funds for running their activities, while the Congress Party is in the hot seat could skim off from the top of the foreign deals, to which, only the party in power would have access. Thus was born the Bofors scandal. That tradition is alive and well, only more brazen.

The AgustaWestland story is the case in point. In fact, before one forgets, Westland helicopters, the UK company had a brush with scandal already in the times of the Rajiv Gandhi government. It was then charged with giving kickbacks for helicopters purchased at the request of Margaret Thatcher by the Indian government. The choppers were bought to start the public sector civilian helicopter service, Pawan Hans.

So, why this long regurgitation of history? Considering the fact that the defence sector deals are large and substantial in size, and in importance, not many politicians can ignore their allurement. Be it Mulayam Singh Yadav or George Fernandes, their socialism has not come in the way for falling into the easy ‘cash trap.’

As a retired air marshal, who has some knowledge about how the Russians operate, told this writer a few days ago: there is an established process that Moscow has perfected with their arms sales. Any defence deal struck with the country’s arms merchants has an extra 15 per cent cost padded up. Ten per cent of that goes into greasing the palms of the politician-bureaucrat-military nexus in India; and five per cent goes back to pay the political ‘facilitators’ in Russia.

There should not be any surprise in finding that even the Israelis have a similar system. They are, after all, the second largest arms supplier to the country. But what these endemic corruption scandals do to the military preparedness of the country is the tragic part of the story. Even after more than two decades of Bofors blowing up in the face of the Congress party, the Indian Army is short of the howitzer guns it much needs.

In fact, there is something Quixotic about those who try to sell guns to India; for each of them eventually get embroiled in corruption scandals and get ‘blacklisted.’ But that doesn’t stop them from indulging in the same practices over and over again.

This is the way the arms bazaar works. It is an established fact that arms agents worldwide scour the market to identify suppliers to match the buyers and get a commission. But India in denial, with a kitty of $150-200 billion to be spent in the next decade, want to swim against the tide. Still, the man who had promised to actually establish the rule, A K Antony, had one fatal weakness: he could not ignore calls from Ahmed Patel.

So, an Abhishek Verma could still draw up an engagements list that included a meeting with director general (acquisitions) of the defence ministry the same day he was shepherding his client, Sig Sauer, to meet Rahul Gandhi.  What is the way out of the morass? It’s simple. Take the discretionary power out of the hands of the oft-mentioned nexus: and transfer it out of the closet, bring it out in the open.

Legalise arms agency. Not in the ham-handed way the BJP sought to do after a new-fangled news publication ‘stung’ them. But in a way that instills transparency into the process, as a former vigilance commissioner suggested, for he had seen too many pricings of equipments that had padding to the extent of even 20 per cent. The world can only laugh at that practice, and of course, Transparency International ranks the country below Pakistan.

The author is a senior journalist
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