IDC Analysis of the TEHELKA Exposures
Delhi, 28 March 2001
Commissions being paid in Defence deals are a world-wide phenomenon. IDC has therefore watched with rapt attention the tapes aired on Zee TV. Between ourselves we pretend to have 90 years of Defence experience and having kept our ears and eyes open, the tapes only confirmed what almost everybody in Defence already knew –– that there are Agents and there are touts in the Defence Business and commissions are paid. K Subrahmanyam in his piece in the TOI on 26th March, very aptly explained that people in positions of power to influence decisions on Defence procurement, have been on the take for the last thirty years.
decade ago the military people were content to get a Calendar and a Pen
and the odd bottle they looked forward to. They may now have progressed to
receiving a few thousand chips and Blue Label, but what has to be
understood is that they could not change or influence a major decision.
Some like Gen Sundarji to gain favour perhaps, merely adhered to the
Government line to recommend Bofors as opposed to the French SOFEMA.
Others may have passed on information, which was on files and Maj Gen KSK
Choudhary's statement on the Tehelka tapes was that as DG WE "I
cannot influence the decision".
top Agents and names like Chaudharys, Khannas, Guptas and Nandas (legal
and illegal since Rajiv banned them all but now mentioned in the Tehelka
tapes) and other names IDC is aware of but without any evidence, employed
retired service officers to ferret out information, while they played
the bigger money game and all top foreign companies know more details
about defence deals than we Indians do. These Agents need to be legalized
for more transparency so that everything is in the open.
Subrahmanyam known to be the best theoretician in Defence has always
analysed issues the best, but in the past he has totally missed out to
recommend that Agents should be legalised. In India it is no wonder
we have Planning Commissions with senior people in charge but no
implementation commissions. That all politicians take commissions as
donations is now common knowledge by acknowledgements on TV.
There should be self-imposed limits, as big deals are all with the
is well recognised that there has been secrecy and skullduggery in arms
deals and that it will be difficult to eradicate this especially
in the third world. As long as professional militaries like ours get what
they need, and the political parties take a few cuts, the world will not
come to any grief. Spreading and investing Money in the arms
bazaar is the norm, and even Singapore succumbed to Bofors’ inducements
and it made big news. It is when the limits are exceeded, and the military
does not get what they need, and touts proliferate and become more
powerful, that sleazy Defence Agents influence decisions.
Skullduggery increases and that is what has happened in India. IDC
offers some analysis on the bigger deals.
Jet Trainer (AJT)
Age has just explained that the Hindujas were the Bae’s go betweens for
the AJT Hawk deal. They learned their trade dealing with the Shah of Iran
and in fact the HDW Submarines India got were originally destined for
Iran. Here IDC would like to juxtapose the earlier article of former Air
Chief SK Sareen in Indian Express with the revelations of R K Jain on
the Tehelka tapes regarding AJT. Sareen explains how the IAF had selected
the British Hawk and French Alpha Jet long ago. These planes could have
been bought ten years ago at £ 5 million a piece, but how some other
parties were deliberately brought in to put the entire deal into a
"sleep mode". Now the nation is at ransom to pay £ 19
million per piece for the HAWKs and they now look as unlikely as before.
The Congress is yelling blue murder and from Tehelka tapes it seems that
the PM has not been too involved in Defence deals. AJT has thus
become the Annual Joke Trainer as one joker put it.
the other hand the twin-seater Alpha Jets, which are readily
available at a drastically cheaper price would appear to be a more
appropriate choice. But we thank Jain for his insides and can see that the
AJT deal, so direly needed by the young IAF Pilots is going to be derailed
yet again unless the Government shows some guts as the money is already
budgeted. It is the need of the hour according to Sareen, if lives are not
to be lost.
we also know that Jaya Jaitley and George Fernandes gave permission to R K
Jain to go to Moscow to sign the MiG Agency deal and they must confirm or
PSUs, BHEL, BEML AND BARAK
order for 87 Armoured Recovery Vehicles (ARVs) went to POLAND and IDC has
seen shipping documents consigning them to BHEL some months ago. It was
surprising. Now Tehelka tapes say Nanda tried to push for the Slovak
ARVs but failed, and yet coughed up. There has been no denial so far.
IDC knows that the big players acting for foreign Military/Industrial
Complexes and such Principals distribute money and some times
cover two countries through multiple Agents. Israel lets two firms
compete hoping one gets the order.
IDC had read Rahul Bedi (Janes’ correspondent)
in one of his articles in Asian Age that PSUs were now being chosen as the
conduits for defence suppliers, to make deals look clean. At that time we
did not know what he was getting at but Janes gets fed inside information
from competing parties, more the reason to legalise Agents. So far the
OTO MELARA deal done years ago by BHEL who had no clue about guns has not
come up. The whole business of defence deals in the developing world is
intriguing. Years ago HMT with Mr Ghosh (later with BALCO) had become
Defence Agents and wasted HMT money on some deals.
On Barak the Navy definitely needed the SAM missile system as the present CNS has explained, but it appears that seven systems have been pushed through in a real hurry and some one seems to have made some gravy . IDC had reported the missile system is installed on INS Viraat (as seen during the IFR) but the full system is not yet operational as two separate suppliers are involved Rafdael and IAI.
why collaboration to make TRISHUL successfully with a country like Israel
was not pursued since millions are being spent on it in any case.
In fact all our DRDO projects can become operational if they collaborate
with leading foreign companies. It is the finishing of a house that
takes experience and time. Our LCA Project, Missile Systems, PINAKA, ARJUN and
ALH all need finishing and collaboration with foreign experienced firms
may be the answer and we can export the products as Ford IKON has
shown. There was a scandal on the Cassapir vehicles imported from South
Africa as being second hand and not new and now we read some Army officers
have improved the engines locally. Asian Age has raised the issue that the
10 Mirage 2000H ordered are second hand and IDC has not read any
clarification otherwise. If there was a legal Agent we could ask him but
an Agent there must be!
and Treasurers As Conduits
IDC learnt that the powerful Rajiv Guaba Secretary to RM got involved in PNCs as per the tapes. Another name Satyamurti PS to Bangaru Laxman was privy to knowledge of transactions and one Rajiv Tomar's (?) name came up. Names of Companies came up Corentti, Quotrain, SG, Boomer, so the tapes are genuine as far as bragging by R K Jain and Gupta and others depict again and again. Again Rahul Bedi had written on the SOLTAM deal to upgrade Army 130s to 155 mm, which these people knew about and many service officers are unaware because of secrecy.
this background and what we saw Jaya Jaitley had to say, it is
difficult to believe George Fernandes did not know all this. It is a bit
far-fetched as he is the cleverest of all RMs. He had been to Siachen 18
times. IDC recalls that a Commanding Officer who liked to mix with
the sailors on his ship, was once told by his No. 1 (Second in Command)
"Sir you are mixing with the sailors too often, that is my job not
yours." The CO took it well and later became a Flag Officer. Going to
Siachen 18 times makes you popular with the troops but not necessarily a
good RM. The crux is what Tehelka conveyed in what it said to
Bangaru Laxman "Sir if there is 25% chance we are willing
take the risk".
IDC is developing a sneaking admiration for George Fernandes and sympathy
for Vajpayee. If George ditches the NDA, the Government is in trouble so
Vajpayee has appointed a make shift Defence Minister in Jaswant Singh, for
if he appointed a permanent one, which the Services need at the
moment, then the promise given to George that he would return to
Defence would be meaningless.
is India's Karma and the GoM recommendations lie with the PMO. TOI calls
7 Dec IDC had posted a study on the PMO
and how it works and we were delighted to see that post Tehelka the whole
nation including Bal Thakeray is talking about the PMO. IDC did it long
ago because we are dedicated to see that India's fine Armed Forces are
never let down and this is our supportive analysis. Lets set the house in
order as Dr Manmohan Singh set our economy on a growth path. An
honest and dedicated Defence Minister can do that if he just heeds the
professionals in and out of service --- the people in the services are the
best. Jai Hind.
Now we leave it to the Army Court of Inquiry and Justice Venkataswami to go into l’affaire Tehelka, but suggest that the first step is to streamline the procurement system and legalise Agents. It is heartening to know Mr. BG Varghese has been appointed to assist the Army to deal with transparency aspects of the huge Military.