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Probe FDI in Indian politics

Probe FDI in Indian politics

Author: A Surya Prakash
Publication: The Pioneer
Date: November 8, 2005

The Volcker Committee's conclusion that the Congress party and Union External Affairs Minister Natwar Singh were beneficiaries of Saddam Hussein's largesse is a wake-up call for all Indian democrats. Coming as it does within weeks of the disclosures in The Mitrokin Archives II, which spoke of how the KGB funded the Congress and the Communist Party of India (CPI) since the early days of independence, it seems the time has come for a credible, full-fledged inquiry into the funding of political parties in India, including the flow of foreign funds into party coffers.

The Manmohan Singh Government's decision to request former Chief Justice RS Pathak to probe the Iraq Oil Scam insofar as it relates to India would be welcome if the terms of reference were to extend to the larger issue of funding of political parties in our country. I say this in the context of mounting evidence of political parties relying either on foreign benefactors or on cuts in international deals to underwrite political expenses and the consequential foreign interference in our politics and national policies.

While the Volcker report is currently engaging the attention of the media and the political class, Vasily Mitrokhin's testimony regarding the funding of Indira Gandhi's Congress during the 1971 election by the KGB and about the moles in the Union Cabinet when the Congress was in power at the Centre, needs to be investigated, as also the direct funding of the CPI by the erstwhile Soviet Union, if we are to preserve our sovereignty and democratic constitution. Also worthy of enquiry is the opinion of honourable fellow citizens who have held key positions in Government and politics that post-1970, the Congress party decided to fund its activities via commissions on mega contracts. In his memoirs A Cabinet Secretary Looks Back, BG Deshmukh, former Cabinet Secretary, says, "The genesis of the Bofors affair lies in the practice initiated by Indira Gandhi and further refined by her son Sanjay for collecting funds for the Congress Party. Till the middle of the 1960s, during the regime of Pandit Jawaharlal Nehru, collection of funds for the party was more transparent business and business houses were also permitted to make open donations".

Indira Gandhi, says Deshmukh, was in dire need of funds to fight elections and establish herself as the undisputed leader of the Congress party. For this she depended on loyal supporters like Rajni Patel and Vasantrao Naik. "Later, when she had established her supremacy in Indian politics, she decided that a far better way to collect funds for the party was through claiming cuts from foreign deals. Sanjay Gandhi perfected and refined this still further from 1972 onwards." Mr Deshmukh says when Indira Gandhi returned to power in 1980, he was additional Secretary in the Ministry of Home Affairs. "My colleagues told me that in January 1980 itself Sanjay Gandhi called senior officers from certain concerned ministries for giving orders and making deals and clearly and firmly told them how they should be finalised. Trusted senior officers were posted to ministries such as the Defence Ministry and also to the Department of Defence Production. Even the death of Sanjay Gandhi in mid-1980 did not change this practice..."

Mr Deshmukh thereafter quotes former President R Venkataraman, who in his autobiography recounts a conversation he had with JRD Tata. According to Mr Venkataraman, "he (JRD Tata) felt that since 1980 industrialists had not been approached for political contributions and that the general feeling amongst them was that the party was financed by commission on deals." For how long are we going to ignore the evidence that is put before us not just by KGB spies and UN investigators but our own former Presidents and senior civil servants?

However, returning to the Volcker report, it must be said that the initial reaction of the UPA Government and the Congress brought back memories of the ostrich-like approach of the party and its government to allegations of payoffs in the Bofors gun deal after the Swedish National Radio broke the story in April, 1987. The Rajiv Gandhi Government had described that report as "baseless and mischievous" and persisted with flat denials even as the media dug out clinching evidence of commissions paid out by the company.

Fortunately, Prime Minister Manmohan Singh and his colleagues have seen the futility of such an approach and decided to institute an inquiry into the Iraq Oil-for-Food Scam. Much, however, will depend on the terms of reference of the judicial commission. While this commission can look at the macro issues, the law enforcement agencies must get on with the job of probing illegalities if any and instituting criminal proceedings where necessary.

Though public memory is short, people do remember the shoddy whitewash done by the parliamentary committee headed by B Shankaranand while probing the Bofors payoffs. This committee had concluded that there were no middlemen in the deal and no commission was paid by Bofors. Subsequently, media investigations showed that the parliamentary committee's findings were not worth the paper they were printed on. Further, the Congress party has not explained why the Swedish arms manufacturer credited US $7 million to a bank account operated by Maria and Ottavio Quattrochchi, close friends of Sonia Gandhi, when we bought field guns for our army. Who were the Quattrochchis fronting? Questions such as these are certain to engage the public mind if inquiries into allegations of corruption remain incomplete.

Meanwhile, in his anxiety to shield the Congress and the Nehru-Gandhi family that has proprietorial control over it, Mr Natwar Singh has only complicated matters. In his interview to Barkha Dutt of NDTV, the evidence he offered to emphasise - the old ties between democratic India's oldest party and the Baath Party of Iraq - was indeed shocking. Iraq, he said, was one of just two nations that supported the infamous Emergency imposed by Indira Gandhi in 1975. Mrs Gandhi turned a vibrant democracy into a dictatorship, suspended fundamental rights, jailed her political opponents and stripped the Constitution of core democratic values during the 19-month Emergency.

If, indeed, Iraq was just one of the two nations to support her authoritarian regime, the link between the Congress and the Baath Party is a dangerous liaison that bodes ill for our democracy, more so if the latter is also funding the former. Equally preposterous is his observation that the BJP, which is the main opposition party, is misusing the democratic system that the Congress gave the country after independence! The freedom movement was led by Mahatma Gandhi and the core ideas of equity and equality came from the Mahatma's teachings and were embedded in the minds and hearts of our constitution makers and the people at the time of independence. The liberal, secular, democratic constitution is what we have given unto ourselves. "Our" will was executed by BR Ambedkar, Sardar Vallabhbhai Patel, Jawaharlal Nehru and many others who were members of the Constituent Assembly.

So, Mr Singh, please do not credit the country's political system and the Constitution to the Congress party. On the other hand, should Mr Singh ever read the 39, 40, 41 and 42 Amendments to the Constitution which were introduced by the Congress during 1975-77, he would be suitably educated on the 'democratic credentials' of his party and the family that presides over it. These amendments constitute the most horrendous assault on the Constitution since independence.

Therefore, the claim that the Congress is deeply wedded to democratic principles is laughable. Equally worrying is the manner in which Mr Singh's post-Volcker troubles have begun to impact India's foreign policy. His latest statement about a possible rethink on the Iran vote and his attempts to portray himself as a fighter against American imperialism does not augur well for the country's external relations.

Hopefully, Mr Natwar Singh presents only a temporary problem. Once he is out of Government, we must address ourselves to the larger issue - the funding of political parties - and make the first attempt after independence to clean the Augean stables.

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