Baseless Allegations of Bribery in Chopper Deal fails scrutiny

Ak 20antony  621x414 Sun, 05 Jun 2016

Baseless Allegations of Bribery in Chopper Deal fails scrutiny

SHRI A.K. ANTONY : Sir, Defence procurement, has all along created a lot of controversies from the beginning. But you may not agree because it is obvious that you may not appreciate the previous Government. That will create problem for you. But I can tell you sincerely that our Government, from dayone onwards, was very clear that in the area of Defence,there should not be any compromise on corruption. Thereshould be zero corruption in Defence because our Jawansare shedding their blood to protect the borders, lands, seaand air. They are sacrificing their lives.


You must not allow this corruption in Defence area. So, in UPA-1 onwards — I don’t claim that we were hundred per cent successful — with a conscious effort we were trying to prevent and ultimately eliminate corruption from Defence procurement. So, first we started revising the Defence procurement policy. It was the first time that the Government of India during the time of UPA-1, introduced DPP (Defence Procurement Procedure) giving a lot of safeguards to prevent corruption. Afterwards, there was a second addition and we introduced a new concept of Integrity Pacts, Pre-contract Integrity Pacts in which there is a provision that any company which violates Integrity Pacts, can be debarred for five years or ten years, criminal actions, or the money can be taken back or so many repercussions. After that, by action we had shown to the country, shown to the world, mighty world, that we mean what we say. I am quoting only official records, that is, public records. I am on oath. These are public records. I know secret records, but I will not reveal because I am on oath.


This is the Report of the Press Information Bureau, Government of India, dated 11th March, 2013. It says, “The Government has blacklisted following six firms for a period of ten years by the Ministry of Defence I.D. No.310, April, 2012: Singapore Technologies, Israeli Military Industries Limited, Rheinmetall Air Defence (RAD), Zurich, M/s Corporation Defence, Russia, etc.” These are all powerful multinational companies, and these include two Indian companies as well. We didn’t show mercy. When corruption was proved and the CBI recommended that we should take action and blacklist them, we blacklisted six companies. This happened for the first time that six companies, at a stretch, were blacklisted. Otherwise, some years back, one company was blacklisted. So, not sitting on procedures, we also took action and sent a message to the world, sent a message to the arms dealers, that India would not tolerate corruption. We proved that merciless strong action would be taken. That was our message at that time.


Sir, this is as far as the background is concerned. Coming to this particular thing, so many friends quoted so many things including CAG Reports and newspaper reports. In the last few weeks, many people were trying to make clouds. I would like to present a few facts after which I will also table them in the House. This is also the official release of the Press Information Bureau relating to the Ministry of Defence, titled, ‘Acquisition of AW-101 Choppers for IAF: The Facts’. This is dated 14th February, 2013. Everything is stated here. I don’t want to read everything, but I will place it also. I would first quote one part to reply to what has been raised here. As many of you mentioned here, this process started in 1999 when the NDA was in power. I don’t want to blame anybody. I don’t want to point a single finger at anybody.


The process started in 1999, and the RFP was issued in March, 2002. But the undisputed fact is, and I read: “On November 19, 2003, a meeting was taken by the Principal Secretary to the P.M. on this subject. In the meeting, the Principal Secretary observed that his main concern was that the framing of the mandatory requirements has led us effectively into a single vendor situation. It was also noted that P.M. and President have rarely made visits to places involving flying at an altitude beyond 4500 metres.” So, in the meeting, the first decision was to lower the altitude. It says, “In the meeting, it was decided to make the mandatory requirement for operational altitude 4500 metres from 6000 metres.” It was a decision taken in a meeting presided over by the then Principal Secretary to the Prime Minister. I don’t blame him. But the decision to change the height was taken by the then PMO, the then BJP Government, from 6000 metres to 4500 metres. And, one more decision was taken at that time. “The higher flying ceiling of 6000 metres and a cabinet height of 1.8 metres could be made desirable operational requirements.” So, this height of 1.8 metres was also decided at that time. This is not an off-the-cuff remark. This is as per the official release of the Ministry of Defence dated 14th February, 2013. So, the height was reduced from 6000 metres to 4,500 metres and cabinet height was decided at 1.8 metres.


The major decision was taken at that time in 2003 by your Government. This is not a Press statement. This is an official release, official document of the Ministry of Defence on February 14, 2013. I am quoting a decision of 2013 of para 3. On November 19, 2003 a meeting was taken by the then Principal Secretary and in that meeting it was decided, the height of 6000 to 4500 and cabin height of 1.8 metres. It was by your Government. Don’t accuse us. I don’t blame you also. I am not saying that they have done this or that, but the decision was taken by you. Don’t put the blame on us. Also, the meeting was followed by a letter, dated 22nd December, 2003, from the Principal Secretary to the PM to the Air Chief stating that it was unfortunate that neither the PMO nor SPG was consulted while framing these mandatory requirements. He suggested that CAS and Defence Secretary may jointly review the matter to draw up realistic mandatory requirements satisfying operational security and convenience requirements of VVIPs.


In pursuance of the above directions they changed these things. As a follow-up action of this in 2005 is, the required numbers of helicopters for the entourage of VVIPs was further deliberated between Air headquarters, MoD and SPG. The quantity of helicopters proposed for procurement was revised from 8 to 12 by adding four helicopters in non- VIP configuration for security reasons. It is eight for VIPs and four for non-VIPs. Don’t twist the facts. The Field Evaluation Trial of M/s AgustaWestland was carried out in UK and trials of M/s Sikorsky were carried out in the USA from 16th January 2008 to February 2008. Here Yadavji pointed out, ‘Why outside?’ This is allowed in the rule. But, it is not a normal practice. When the file came to me first, in the very CAG report it is written, ‘The Defence Minister objected it first’. The same Report released and this part you conveniently ignored.


Let me say, the file is now with the present Defence Minister, not with me. Leave it to him. If I am wrong, he can produce the file here. At the first instance, I opposed it. I wrote there. I raised many objections. It is in the CAG Report also. Since you read the CAG Report, fairness demands you could have read that also. But you did not do. I did not expect it from a gentleman like you. So, then, again Air Force Chief wrote to the Defence Secretary. The file is with you. Then, I wrote to the Defence Secretary that we couldn’t delay it.


Then, the whole department, from the lower level onwards, i.e., Joint Secretary, Additional Secretary, DG (Acquisitions), Defence Secretary and everybody has gone through it. They, then, finally, endorsed the view of the Air Force Chief, with reasons. Then, it came to me, second time, and I agreed. This is the fact; not the first time. First time I also put a query. Why? I did not agree. During the Field Evaluation Trials, all the security agencies were present. All of them were there — Air Force, SPG, MoD and all concerned, including the Finance Ministry. After that, Staff Evaluation Report was concluded. All agencies were present. Technical Oversight Committee concluded. All the agencies were there. But, at the Contract Negotiation Committee stage something had happened. The Air Headquarters recommended inclusion of Traffic Collusion Avoidance System and Enhanced Ground Proximity Warning System for all 12 helicopters. And, SPG recommended inclusion of Medevac System for 8 VVIP helicopters. The additional equipment was considered to be essential for safe and effective operation of helicopters. So, this also added at an additional cost.


So, the procurement case was, thus, progressed in accordance with the established procurement procedure in a transparent manner with all stage of procurement being followed meticulously. Security aspects were also considered. These are all Defence Ministry’s releases after examining the file. The contract signed with M/s AgustaWestland includes specific contractual provisions against bribery and the use of undue influence. In addition to the above contractual provisions, M/s AgustaWestland has signed an Integrated Pact with the Government. The validity of this Integrated Pact is from the date of its signing and extends up to five years or the complete execution of the contract, whichever is later. Then, allegation started coming in. As regards allegations, unethical dealings in helicopter procurement case, including involvement of middlemen and payment of bribes, etc., were reported.


The first report in the media appeared in February, 2012. It was the first media report. Immediately, the very next day of the media report, after news appeared in the papers, DG (Acquisition), MoD, sought a factual report in the matter from our Embassy in Rome. Sir, we had acted the very next day; not after one or two years. The next day we had acted. Then, MoD was contacting through MEA, Embassy in Rome, Government of Italy, the Government of UK and, ultimately, when all attempts failed, we became a party in the case in Italy. It is unusual in the Government. This shows our willpower, determination to find out the truth. We became a party. We fought with the company. That is why this verdict. Since we have also become a party, in every hearing, we sent our team during our time. I don’t know what happened after we left.


During our time, in every hearing, we sent a team consisting officials of the Ministry of Defence, officers from the CBI and that of the MEA.


So, we fought the case in Italy by engaging an Italian lawyer. Sir, right from day one, when news broke out in the media, we pursued it. And, also we got a letter received from one Mr. Edmond Allen, USA. MoD had written about the involvement of one Abhishek Verma. MoD had written on 19/4/12 to CBI and Enforcement Directorate for the necessary action as Abhishek Verma and others were also being named in various media reports in connection with several Defence deals. That also we have written to them. In short, throughout the process of this case, MoD has been prone to taking action on newspaper reports. MoD was under us at that time. We were very prompt in taking action and in pursuing the case.


Finally, as soon as, information was available of one concrete step having been taken by the concerned foreign investigating authorities, namely, the arrest of Mr. Giuseppe Orsi, CEO, Finmeccanica on February 12, 2013, MoD handed over the case immediately, after knowing the news of arrest of the CEO of this company, to CBI for investigation and put on hold all further payments to AgustaWestland. Besides this the Indian Embassy has been requested to provide the factual position and any other relevant information. So, the moment we got information from the courts, immediately, we handed over the case to CBI. That is one part. This is all in the First Information Report. I will submit it afterwards. We are authenticating this. Then, what happened after that? I made a statement at that time. I think hon. Shri Prakash Javadekar raised the question. That day, I not only made the statement but, after that, on our own, we made a commitment that we are ready for a JPC.


Normally, JPC is always constituted after the Opposition demands for it. But, the then Government on their own said let us have a JPC. For days together, weeks together, we can discuss everything. We can call the witnesses. We can call everybody. But, the then, Leader of Opposition said, “No it is a useless thing”. So, we were willing to have a JPC. JPC can invite all the people as witnesses and summon them. But, you opposed that opportunity. Then in that statement, I said, and I can read, “The Ministry of Defence, Govt. of India joined the case as an affected civil party in the court of Milan. Representing the Ministry of Defence, CBI have been attending to it.” During the hearing, in Italian court, one unsaid paper was circulated. Prosecutor asks Mr. Haschke, “What do you mean by ‘family’?”, “He said, family means Tyagi brothers.” I have to consult you. All reports of the hearings of the court are with you. “Family means, Tyagi family. Regarding AP, I don’t know what it means.” This is what he said. Then, you are saying about blacklisting. We started the process of blacklisting. In February, 2014, we started the blacklisting process. The matter was referred to the Additional Solicitor General. He said, “It is not advisable at this stage.


If you blacklist the company now, it will affect our case for reimbursement of bank guarantee. It will affect us and it will also affect the criminal proceedings in Italy. So, you have to wait.” So, we waited. Then elections came. We lost the power. You are there. But, I am not going into the details. Now you are there. I would like to ask you only two things. Now, it is proved beyond doubt that there is corruption in this deal. There is the Italian court judgment. All legal hurdles are over. You have to act now. Firstly, you have to speed up the arbitration proceedings. We have appointed one on our side, Justice Jeevan Reddy. They also have appointed one from their side. They have demanded heavy compensation. Conduct the case successfully and get the money for us, more money for us as compensation. It is your duty because now the corruption is proved. Since the corruption is proved, we can win the arbitration case. You can get thousands of crores of rupees as compensation. Get the money. That is one thing. Secondly, since the corruption is proved, take action against the company who gave the money. And then, take action against the takers, whoever it may be. Take action against them also. It is your duty, not my duty, not our duty. Thirdly, since all legal hurdles are over, immediately, without delay, blacklist the company for ten years. Do it immediately. This time, you have done it for six companies, so do it immediately. The next day you do it or as quickly as possible. Finally, since everything is proved, since this company is a corrupt company as it is declared by the Italian court, please do not involve them in any of the ‘Make in India’ projects? If at all they are there, remove them.


We don’t want any cover-up. We don’t want to save anybody. But don’t try to create clouds. You will not be able to succeed. Don’t politicize the issue. You will repent. You will not be able to pinpoint us. You complete the cases. Firstly, you take action against the company and blacklist the company. Remove it from the ‘Make in India’ project. Speed up the arbitration process and complete the investigation and take strongest action against takers of money, whoever it may be. Don’t try to blackmail the people. Don’t threaten the people. My dear Subramanian Swamyji, don’t threaten us. If you have all the evidence, take action and prosecute, but don’t threaten and blackmail. This is what I wanted to say.