Zee Follow Up

By: RAHUL AGARWAL
Telecast: Saturday Jan 31 at 7:30pm
Repeat: Friday Jan 30 at 12:30 pm
A Delhi court cleared the late Prime Minister Rajiv Gandhi of involvement in a corruption scandal involving military purchases from Sweden`s arms company Bofors, 17 years after it burst like a volcano in Indian politics. In a verdict that could impact the upcoming national elections, the Delhi High Court said there was no evidence of Gandhi`s involvement in the case, which snowballed into a major row after breaking out in 1986 and led to Gandhi`s rout in the 1989 parliamentary poll.

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Judge J.D. Kapoor also acquitted Britain-based Hinduja brothers - Srichand, Gopichand and Prakashchand of charges of conspiring with Gandhi and other public servants to cheat the Indian government.

However, the Europe-based Hinduja brothers as well as AB Bofors, the former Swedish supplier of the powerful artillery guns, will face trial for entering into a criminal conspiracy to cheat the Indian government.

The brothers will also be tried on charges of forgery. The Hindujas are charged with receiving huge kickbacks from Bofors for securing a contract to supply 400 howitzers to the Indian Army in a 1986 deal valued at $1.3 billion. THE Hinduja connection gave the saga a new life. The Hindujas were a controversial, non-resident, Sindhi business family who had already been in the public eye when former Defence Minister, V P Singh, had alleged that they were agents in the HDW submarine deal. Moreover, it had been believed that the Rajiv Gandhi government had banned the Hindujas from entering the centres of power. One foreign minister, Baliram Bhagat, had been sacked because he had visited the Hindujas in London while in office. So how had the Hindujas swung the Bofors deal?

As the controversy swirled, the Rajiv Gandhi government appointed a joint parliamentary committee (JPC), ostensibly to investigate the matter. Because the Opposition boycotted the JPC, its report quickly turned into a whitewash. Nevertheless, the JPC did make some interesting revelations. One: Bofors had two agents in India. They were called Pitco (so The Hindu was right all along) and Svenska. According to Bofors, they had terminated the agreements with Pitco and Svenska after the government asked it to sack its agents. Why then did Pitco and Svenska continue to receive money from Bofors? Well, said Bofors, those were winding-up charges for terminating the contract.

IF this explanation was unconvincing, then Bofors faced even more difficulty in explaining why it had hired a third agent called AE Services after it had terminated the arrangements with Pitco and Svenska. Finally, the Bofors executives examined by the JPC offered this explanation: we forgot that we weren’t supposed to hire agents.

The more anybody with an open mind (excluding the JPC) examined the arrangements with the agents, the more suspicious the hiring of AE Services became. Not only had it been hired while the deal was in its final lap, but it was also supposed to get a commission only if the contract was signed within a particular time frame. By some fortuitous coincidence, the deal was pushed through just before the deadline expired. Logically, the Bofors scandal should have ended with Rajiv’s assassination. There is a tradition in India that we do not speak ill of the dead. Even if Rajiv had taken money from Bofors, this was now in the past and of no interest to anybody. But such was the power of the Bofors scandal that nothing, not even the assassination, could diminish its lure.

During the Narasimha Rao government, Chitra Subramaniam produced documents suggesting that some of the money that had been paid by Bofors as commissions had been diverted from a Swiss bank account to another account, the ultimate beneficiary of which was Quatrocchi. Even while the CBI debated whether to interrogate him, Quatrocchi skipped the country. He has not set foot in India since then but continues to issue statements from his new home in Kuala Lumpur declaring his innocence.

If the Hindujas are not the signatories to the Bofors accounts, then why were they appealing to prevent the documents from being transferred? The Hinduja explanations have been vague and unconvincing. Meanwhile, the Swiss dismissed appeals filed by Chaddha (who was the signatory to Svenska) and Quatrocchi (who it now seems was behind AE Services) and transferred those papers to India. Only the Hinduja papers are still pending because the family has gone to the Swiss Cabinet for a final appeal. If this appeal is rejected, the documents will be here by Spring 2000.

The Vajpayee government has used the two sets of documents that have been transferred to file a charge-sheet in the Bofors case. Controversially, it has named Rajiv Gandhi as an accused, even though he is dead. The government’s defence is that as the case has been filed under the Prevention of Corruption Act, it has to prove that the money was transferred to a public servant to demonstrate corruption. It will probably argue in court that Quatrocchi intended to pass on the AE Services money to Rajiv, though how it can possibly prove this is hard to see. But the High Court verdict brought joy to the Congress, which showered congratulatory greetings on its president Sonia Gandhi, the widow of Rajiv Gandhi, who has for years stoutly defended her husband against charges of kickbacks in the multi-billion-rupee scandal.

"This is a great moment for us, but we are not surprised," Congress leader Kapil Sibal said. "Our hearts are with Sonia Gandhi, (and her children) Rahul and Priyanka."

The Bofors scandal was perhaps the first corruption charge of its magnitude and shook the very firmament of Indian politics, besides casting a long shadow on Rajiv Gandhi - who was until then tagged with the label of "Mr Clean".