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Kickbacks in India’s defence purchases

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Prime minister Narendra Modi of India boasts his government of being corruption- free. But, his claim has become questionable in the light of recent audit of Rafale purchase in France.

India had ordered 36 of these fighter aircraft from France in September 2016. The 7.8 billion government-to-government deal for 36 fighter jets was signed in 2016. The Indian Air Force has already raised its first squadron of the Rafale jets at Ambala and is due to raise the second one at Hasimara in West Bengal.

India expects to receive more than 50 percent of these fighters by April-end. The first batch of five Rafale jets had arrived in India on July 28 and was officially inducted on September 10 by the government.

In a startling disclosure, the French Anti-Corruption Agency, Agence Française Anticorruption

has announced that their inspectors have discovered an unexplained irregularity during their scheduled audit of Dassault. According to details, “the manufacturer of French combat jet Rafale agreed to pay one million euro to a middleman in India just after the signing of the Indo-French contract in 2016, an investigation by the French publication Mediapart has revealed. An amount of 508,925 euro was allegedly paid under “gifts to clients” head in the 2017 accounts of the Dassault group  ( Dassault paid 1 million euro as ‘gift’ to Indian middleman in Rafale deal: French report India Today Apr 5, 2021). Dassault tried to justify “the larger than usual gift” with a proforma invoice from an Indian company called Defsys Solutions. The invoice suggested that Defsys was paid 50 per cent of an order worth 1,017,850 for manufacturing of 50 dummy models of the Rafale jets. Each dummy, according to the AFA report, was quoted at a hefty price of 20,357. The Dassault group failed to provide any documentary evidence to audit about the existence of those models. Also, it could also not explain why the expenditure was listed as a “gift to clients” in their accounts.

Shady background of Defsys

Defsys is one of the subcontractors of Dassault in India. It has been linked with notorious businessman Sushen Gupta. Sushen Gupta. He was arrested and later granted bail for his role in another major defence scam in India, the AgustaWestland VVIP Chopper case.

The Enforcement Directorate charged Sushen Gupta for allegedly devising a money-laundering scheme for the payouts during the purchase of the helicopters.

Rampant corruption in India

Corruption in defence deals is a norm rather than an exception in India. They did not spare even aluminum caskets used to bring back dead bodies from the Kargil heights (“coffin scam”). Investigations into shady deals linger on until the main characters or middleman is dead. Bofors is a case in point.

Why investigation of defence deals since independence recommended

India’s Tehelka Commission of Inquiry headed by Mr. Justice S N Phukan had suggested that a sitting Supreme Court Judge should examine all defence files since independence.

Concerned about rampant corruption in defence purchases allegedly involving Army personnel, he desired that the proposed Supreme Court Judge should by assisted by the Central Vigilance Commission and the Central bureau of Investigation.

He stressed that unless the existing system of defence procurement was made more transparent through corrective measures, defence deals would continue to be murky. He had submitted his report to then prime minister Atal Behari Vajpayee, but to no avail. The Commission had examined 15 defence deals including the AJT, Sukhoi, Barak missiles, T-90 tanks, tank navigation systems, simulators, hand-held thermal. imagers, Karl Gustav rocket and Kandla-Panipat pipeline. The irregularities in the scrutinised defence deals compelled the Commission to suggest de novo scrutiny of all defence purchases since independence.

Tardy trial

The courts have absolved Rajiv Gandhi of involvement in the BOFORS scam. However, a considerable section of Indian people still believes that ‘Mr. Clean’ was not really so clean. The BJP exploited Rajiv’s acquittal as an election issue. Kuldip Nayyar, in his article “The gun that misfired” (Dawn February 14, 2004) laments, “There was practically no discussion on Bofors-guns kickbacks in the 13th Lok Sabha which has been dissolved for early elections. Once Rajiv Gandhi died the main target – the non-Congress parties lost interest in the scam”.

According to analysts, the mechanisms of public accountability in India have collapsed. Corruption has become a serious socio-political malady as politicians, bureaucracy and Armed Forces act in tandem to receive kickbacks. The anti-corruption cases, filed in courts, drag on for years without any results. To quote a few case: (a) There was no conviction in Bofors-gun case (Rs 64 crore), because of lethargic investigation (the case was filed on January 22, 1990 and charge sheet served on October 22, 1999. Among the accused were Rajiv Gandhi, S K Bhatnagar, W N Chaddha, Octavio, and Ardbo. The key players in the scam died before the court’s decision). (b) No recoveries could be made in the HDW submarine case (Rs 32.5 crore). The CBI later recommended closure of this case. (c) Corruption in recruitment of Armed Forces.

Legal cover for middlemen

Central Vigilance Commissioner P Shankar had alleged (October 2003): “The CVC had submitted its defence deals report on March 31, 2001. Yet a year later, the government has not conducted the mandatory departmental inquiry to fix responsibility”. Shankar explained that the CVC had examined 75 cases apart from specific allegations made by former MP Jayant Malhoutra and Rear Admiral Suhas V Purohit Vittal. Malhoutra’s allegations were about middlemen in defence deals. After his report, the ministry lifted the ban on agents in November 2001 to regularise the middlemen. Purohit, in his petition in the Delhi HC on a promotion case, had alleged unnecessary spare parts were bought from a cartel of suppliers instead of manufacturers, at outrageous prices and at times worth more than the original equipment.

Past cases forgotten to continue business as usual

There were ear-rending shrieks about the Taj-heritage corridor case, Purulia-arms-drop case and stamp-paper cases. Indian Express dated November 11, 2003 reported that the stamp-paper co-accused assistant Sub-Inspector of Police drew a salary of Rs 9,000, but his assets valued over Rs 100 crore. He built six plush hotels during his association for 6 years with the main accused Abdul Karim Telgi. The ASI was arrested on June 13 and charged under the Maharashtra Control of Organised Crime Act. Investigations by the Special Investigating Team (SIT) probing the stamp scam had found that the ASI Kamath accepted Rs 72 lakh from the scam kingpin, Abdul Karim Telgi, on behalf of IGP Sridhar Vagal.

The problem is that the modus operandi of corruption ensures that it is invisible and unaccounted for. There are widespread complaints that the politicians exercise underhand influence on bureaucracy to mint money. For instance, the Chief Vigilance Commissioner complained to Indian Prime Minister (November 8, 2003) that at least “six cabinet ministers, handling key infrastructure ministries, are harassing chiefs of public sector undertakings for ‘personal favours’, and in some cases even for pay-offs”.

For example, one PSU (Public Sector Udertaking) chief is said to have complained that he was asked to get Rs 20 crore delivered to his minister’s party office and when he refused, he was “denied” an extension. Indian Express dated February 19, 2004 reported, under reportage titled “Figuring India” that ‘Rajiv Pratap Rudy is only one in a long line of ministers who have misused the funds and facilities of Public Sector Undertakings”. The newspaper appended the following bird’s-eye view of the funds (available for corruption) at the PSUs command: Rs 3, 24,632 crore total investment in PSUs, Rs 36,432 crore profits, 12,714 crore profits of monopolies in petroleum, Rs 5,613 CRORE profits of monopolies in power Rs 7,612 crore, profits of monopolies in telecom Rs 10,388 crore, Rs 61,000 crore invested in PSUs in 1991-1998, Rs 19,000 crore returns during 1991-1998.”

Corruption as proportion of gross Domestic Product

Professor Bibek Debroy and Laveesh Bhandari claim in their book Corruption in India: The DNA and RNA that public officials in India may be cornering as much as ₹921 billion (US$13 billion), or 5 percent of the GDP through corruption.

India 86th most corrupt (Transparency International corruption ranking Jan 29, 2021)

India’s ranking on the Corruption Perception Index– 2020 is 86. The index released annually by Transparency International ranks 180 countries by their perceived levels of public sector corruption according to experts and business people. It uses a scale of zero to 100, where zero signifies the highest level of corruption and 100 is very clean.

All-round corruption

In India, anti-corruption focuses on big ticket graft. But it is petty corruption that hurts common people more. Both need to be weeded out. A former World Bank president Robert Zoellick once said, “Corruption is a cancer that steals from the poor, eats away at governance and moral fibre, and destroys trust.”

According to Transparency International, CPI-2020 shows that corruption is more pervasive in countries least equipped to handle Covid-19 and other crises. “Covid-19 is not just a health and economic crisis. It is a corruption crisis. And one that we are currently failing to manage,” Delia Ferreira Rubio, chair of Transparency International said. “The past year has tested governments like no other in memory, and those with higher levels of corruption have been less able to meet the challenge. But even those at the top of the CPI must urgently address their role in perpetuating corruption,” she added.

Concluding remarks

Click Wikipedia to know that Narendra Modi’s “Net worth” is “₹ 2.85 Crore” (June 2020). This figure defies his humble financial background. He has a penchant for hobnobbing with “crony capitalism”. It appears he is worth a lot more.  Those who make illicit money have a knack to hide it.

Mr. Amjed Jaaved has been contributing free-lance for over five decades. His contributions stand published in the leading dailies at home and abroad (Nepal. Bangladesh, et. al.). He is author of seven e-books including Terrorism, Jihad, Nukes and other Issues in Focus (ISBN: 9781301505944). He holds degrees in economics, business administration, and law.

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The Irony of Afghanistan: US Plans Departure amidst Anarchy

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A family runs across a dusty street in Herat, Afghanistan. (file photo) UNAMA/Fraidoon Poya

The peace and prosperity in Afghanistan have been a mere myth for decades. With a succession of invasion by a blood-ridden Taliban rule followed by a 2-decade long US invasion, the said country has seen little tranquillity when it comes to human rights and secure living. While the US vowed to ensure a democratic regime laced by a rule of law in Afghanistan, the withdrawal seems anti-climactic: especially after spending trillions of dollars and suffering thousands of soldiers in warfare. As the egress nears, however, the one glimmer of hope dwindles faster than expected. The hope of peace. It is ironic, however, as to how an invasion initially programmed to contain terrorism is culminating whilst the transition witnesses similar bloodshed and instability.

The Taliban have been infamous for launching attacks against the Afghan armed forces and the US military on a perpetual basis. Not to mention hundreds and thousands of civilians facing the raucous vigilantes for years. While the agreement ensured the safety of the foreign soldiers, however, the civilians continue to face the brunt. The recent attack in the capital city of Kabul is a prime example of how the world superpower leaves the battlefield after instigating the barbaric factions for almost 20 years.

The bombs detonated last Thursday in the neighbourhood of Dasht-e-Barchi, resonating the community pithing the peripheries. The Shia-Hazara community, the largest community in the region, was the main target (as it has been for years by both Taliban and Islamic State). The targeted school rendered a majority of female students who were conceived to be the main target instead of their religious affiliation. Regardless of the underlying intent, the attacks left 68 dead while 165 victims are still struggling in hospitals. The sheer brutality of the attacks signifies how brazen the rebels stand in their positions while the western powers stagger off the mainland under a facade of victory when all that has been achieved is a fragile democracy and a ravaged land that potentially stands open to any militant group even before the forces exit.

Surprising, unfortunate, and even maudlin is hardly the sentiment to describe the brutality. It is the outright indifference that incriminates the US in the warfare that follows its exit. As the officials collect stationery and books strewn across the street, doused in blood, the US is blame-worthy to the slaughter that would most likely not be the end of the tyranny of the militants. The fact that is ridicule-worthy, however, is that the Taliban attended the mediation talks recently and ensured order and calm in Afghanistan, attesting to their will to enforce Shariah in Afghanistan whilst not meddling or overthrowing the government in the ensuing of the US egress. Mere days and the streets are coated with blood especially as Eid festivities are marking the same streets scattered with the remains of the innocent.

While the Taliban denied any involvement in the recent attack, either side poses a problem. If the involvement is in fact a reality, like it has been on similar occasions in the past, the gruesome fact stands tall. No one can stop the Taliban from spreading chaos if they truly want to. The pervasive nature of their rebellion could be gauged by a thorough historical analysis. A group that reached the United States in 2001 and a group that could not be withered by legendary powers like the Soviet Union in the 80s. The Taliban have steered the negotiations and even the US is aware of the leverage they enjoy given it is their homeland whilst the foreign forces have failed to dent their vice-grip on the terrain of Afghanistan.

If, however, the Taliban are taken true to their word, this poses a far sinister possibility. The attacks signify an underground nurturing of an offshoot militant group, possibly the IS or Boko Haram. With US and NATO exiting in September, the Ghani-regime struggling to ensure stability, and the Taliban holding power in scores, anarchy is much more plausible than tranquillity. The US withdraws from the land in the name of ending the endless war. The reality, however, is that the US is receding from an endless war. The war that was ignited by the US would continue to burn with or without the US. The difference is the switch from armed personnel to innocent students and minorities. It is a matter of perspective and, well, ownership and acceptance.

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5th Generation Warfare: A reality or Controversy?

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In the truest sense, the constant repetition of phrase ‘the 5th generation warfare’ by our military leaders in every media conference has been true in the light of the exposition of the Indian sinister campaign against Pakistan in the ‘Indian Chronicles’. Those who were mocking the idea of 5th generation warfare in the context of Pakistan need to revisit their opinions, suggestions and warfare analysis.

Needless to say, Pakistan is facing enormous threats across its borders. The temperature has been red hot in the East and west borders of the country. Since the government of the Modi in its absolute fascistic endeavors took over the valley of Kashmir, the idea of the 5th generation warfare has become incredibly important to understand the volatile and emerging situations. While the India is accusing Pakistan regardless of its pathetic human rights violation in Kashmir, it seems that the war of demonization continues between these two arch-rivals.

Technically speaking, the dossier that Pakistan has recently published of its intelligence reports which clearly indicate the network of India that has been put in place to malign Pakistan and to come true in its ominous ambitions. In the light of the possible threats, Pakistan has to protect the CPEC projects from India and all the workings going on along the one belt and road project as we have undeniable evidence of the threats to the projects. Amid the rivalry of India and Pakistan, there is a play of world super powers as well as both America and China wants to expand their influence in the Asia, and Middle East.

If one belt and road initiatives stand tall in the face of the foreign funded attacks it would become the strength of the country in the near future. Along with protection of the OBOR projects Pakistan needs to understand the fact that it needs regional players to take part in OBOR extension to raise the stakes in it so that other regional actors will help making OBOR a successful economic venture. Since South Asia has been at the center of war from the last three decades only economic success is deemed to cut this root out. It will hopefully carry out people who have been radicalized because of the prolonged war on terror and the subsequent longest war of America in the Afghanistan territory.

The root cause of the Pakistani society of becoming violently rogue has been due to the pathetically designed strategic policies. Now, every effort on the part of the state must ensure economic progress. Wading into foreign wars, in the name of saving Islam has proved detrimental and counterproductive. The recent dossier that Pakistan has published largely identified this fact that the fallout of extremism and the wide network of India has exploited the regional issues, especially secessionists movements, in the country. It is time for our state to take responsible actions against these terror hideouts. Naming them or just publishing a dossier would not make difference until the whole infrastructure of the terror sites raze down to Earth.

The intelligence report that Pakistan has published certainly brought some results to the fore. One, India has been demonized subsequently more prominently in the Arnab Goswami case where it has been openly told to the world that India had fake surgical strikes inside Pakistan. This whole drama was just a political tactic by the BJP party to win in the general elections lately. This proved to the world that India has been maligning Pakistan and its interests in the world. But things are unsettling now. Time has come for India to take upon itself the weight of  its sinister plans against a neighboring country.

It is also theoretically important for the state of Pakistan to really see the emerging trends in the lens of 5th generation warfare as military cadre has been pointing repeatedly in every media conference. If one see the attacks on the infrastructure of the OBOR, insurgents activities along the Durand line, and through the case of Aranab Goswami case, it is vividly clear that the nefarious activities in the guise of 5th generation warfare are true.

There are many political commentators in the Dawn Newspaper who have downplayed the visible threats of 5th generation warfare calling it a facade because of their abnormal understanding of the emerging situation in south Asia. That is why to understand a situation like surgical strikes that too fake one, one is left with no choice but to look up to the themes like 5th Generation warfare.

Until we expose India and our many other enemies through precise and strategic actions with the help of our strategic think tanks, Pakistan will not grow up economically because for economic ease peace is the necessary condition. The core strategy of Indian so far has been deploying maximum pressure upon Pakistan. It is true that India has been successful in some way to malign Pakistan. Visibly, Pakistan has made a lot of investment in the building up of the infrastructure for OBOR projects but apparently our intra-regional trade has been dipped to 7.4 down from 12.2 percent in 2011. It means we have been massively slowed down by India with the help of rising up temperature at the borders and planning attacks inside the country.

All in all, 5th generation warfare has been true in the context of Pakistan. To understand this, we need to connect the dots. The connection of Pakistani intelligence dossier, to attacks inside the country, to Arab Goswami case  and to the Indian lab of disinformation proves the fact that 5th generation warfare is not lost on us. It is a time to rethink on these lines as we will have a tough time in balancing our economy through OBOR, opening intra-trade to maintain political instability in the country.

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China’s quad in the making: A non-conventional approach

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Politics of alliance can be traced to the ancient times of the East and the West. Since it affects the core interest and security of individual states, the leaders concerned seek for alliance partners in order to meet the threat they face and the gains they can expect from alliance. The U.S. has maintained its superiority in military and also created the largest alliance system in the world. Now seeing the rise of China as one strategic competitor in the 21st century, the U.S. has made all efforts to create a “quad” along with Japan, Australia and India in the Indo-Pacific. This leads to an inquiry into how China reacts to the containment led by the U.S.?

China has maintained the high-level of strategic partnership with Russia, Pakistan and now Iran. Yet they aim at strategic consensus, economic connectivity, mutual respect and equality in a challenge to any unilateral hegemony. Due to this, China’s version of the “quad” is more flexible and pragmatic in winning over states with different cultural, religious and ideological backgrounds. Yet the Biden administration has made it clear that it moves to establish a “quadruple” alliance along with Japan, Australia and India in order to insure the balance of power in the Indo-Pacific still to the U.S. favor. To that end, on March 12, the first summit among the four countries revealed their collective security talks on everything from vaccine distribution to fighting climate change, yet also including their viewing China’s efforts to modernize and professionalize its military as a strategic competition in Asia and the Pacific.

Only days after President Biden’s drive for a “Quad” in the Indo-pacific, Russian Foreign Minister Sergei Lavrov made his visit to China during March 22at the invitation of his Chinese counterpart Wang Yi. This reveals the high-level quality of the relations between the two largest Eurasian powers and their agenda has deepened across nearly all dimensions of the comprehensive strategic partnership, such as from diplomacy and defense to economic and technology. The growing ties between China and Russia have aimed to establish a multipolar order that dethrones the US as the global hegemon. In light of the deteriorated relations between China and the U.S. alongside the EU, and between Russia and the Western bloc, the meeting is of strategic implications for China and Russia to consult regularly on the latest issues. Though not ready to forge a military alliance in a traditional way as indicated, China and Russia are actually confident in each other to meet any challenge of the world. The latest announcement that Russia and China would jointly construct a space station on the moon (ILRS) is another great leap forward in the establishment of what is described as the “Sino-Russian alliance in the making”. It clearly reveals that cooperation has become operationally more consequential than the frequently touted democratic partners between the U.S. and India.

During the 1990s,Joseph Nye warned the prospect of the “alliance of the aggrieved” coming from Russian and Chinese strong passion for national glory. Yet, it is very the awkward statecraft of the U.S. that has led China and Russia deftly to overcome conflicting national interests that should make them adversaries on the bilateral, regional and global issues. As Lavrov said prior to his visit, “the model of interaction between Russia and China is free from any ideological constraints. It is of an intrinsic nature, not subject to any opportunistic factors nor against any third countries.”

If the Sino-Russian strategic partnership is seen as the “strategic alliance”, the solidarity between China and Pakistan has been termed as “batie”, referring to “brothers in ironclad”. It is true that China’s normal relations with Pakistan started in 1951 and since1962, the bilateral relations have been transformed into a de facto alliance regardless of the differences in religions and ideologies. Cooperation has covered nearly all aspects from politics to economic and from military to foreign affairs over the past decades. Diplomatically, Pakistan has committed to one-China policy while China has made all endeavors to support its sovereignty, security and stability. Geopolitically, the two sides have worked closely on the joint projects like JF-17 aircrafts, civilian nuclear power plants and the peaceful settlement in Afghanistan since the U.S.-led NATO presence in the war-torn land is seen as a threat to common interest of the two countries and the stability in South Asia as well. Accordingly, Pakistan isseen as one of the key strategic partners of Beijing’s global links, along with Russia and North Korea.

Additionally, in China’s security and development agenda such as the BRI, Pakistanis sure to be a vital partner in light of the decades-long friendship and its location in South Asia near to Strait of Hormuz which links the Middle East. China has invested heavily in the region while it depends on oil, gas and many other energies. To that end, the project of China-Pakistan Economic Corridor has been expected to enhance the strategic connectivity between the two sides to a new high-level strategic convergence. It is in a broader term, alliance forms when states have common interests and strong consensus to pursue them. For example, China, Russia and Pakistan have shared compatible interests in a constructive and inclusive solution to end the civil war in the Islamic Republic of Afghanistan through agreements on the formation of a coalition government with the participation of the Taliban movement.

Now an inquiry is whether China along with Russia and Pakistan would move toward a Eurasian bloc including Iran. On March 27, Chinese FM Wang Yi formally visited Iran, yet what China seeks for in the Middle East is not a traditional alliance like the NATO or the “Quad” in the Indo-Pacific as the U.S. has driven for. Rather, as Beijing reiterated, China acted to persuade the countries concerned to stay impervious to external pressure and interference, to independently secure its own interests in light of the regional peace and stability. Accordingly, China wants to project itself an image as a peaceful power unlike the U.S. and its allies which aim to pursue the exclusive privileges and unilateral interests in the Middle East and beyond.

During Wang’s visit, “the plan for China-Iran comprehensive cooperation” was signed with a view to taping the potentials for enhancing economic and cultural cooperation in a long run. It is said that a 25-year agreement would be able to upend the prevailing geopolitical landscape in the West Asia which has for so long been subject to the United States. Moreover, Iran has forged a de facto alliance with Russia and a strategic cooperative partnership with China. Yet, this plan is essentially a large-scale economic development agenda for Iran which has been illegally sanctioned by the United States. To that end, China and Iran vowed to support mutually on the issues related to their core interest and major concerns, including general opposition to any hegemon dictating international affairs. In effect, China has urged that the United States should first take a step to lift unilateral sanctions against Iran, and return to the Joint Comprehensive Plan of Action (JCPOA), instead of making unreasonable demands on Tehran.

Some people have argued that the interaction of China, Russia, Pakistan and Iran can everywhere outline new geopolitical vectors, which must be taken into account by the U.S. and its allies. It is also true that without the political involvement of Pakistan, China and Russia, the peaceful settlement of the crises in Afghanistan are quite unthinkable. First, China still follows its long-term principleof non-alliance in foreign affair. Second, though stronger economically, China is a new external power with limited knowledge of the region. Considering the prospect that a high-profile deal with Iran may have been met with some backlash from the Gulf states that traditionally see Iran as an adversary, a plan involving economic cooperation is more pragmatic and necessary. Politically it is wise and rational that China-Iran plan fits within its five-point initiative to achieve security and stability in the Middle East, such as mutual respect, equity and justice, non-proliferation of nuclear weapon, collective security and common welfare.

In sum, advancement of China’s quad requires even more focus and attention nowadays. In light of this, the best thing for China to do is to make sure a long-term stability and prosperity in the entire region. For sure, China has pursued its diplomatic goals in accordance with its ancient culture and contemporary grand mission.

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