Chopper deal: Govt factsheet is a red herring, but self-damning

The UPA government, in hastily putting out its own “factsheet” on the Agusta Westland helicopter kickbacks, appears to have given out one vital piece of information that points to its own negligence.

Days ahead of Defence Minister AK Antony's statement in Parliament on 26 November 2012, where he said that “in the absence of any specific information,” no formal inquiry could be ordered in the Agusta Westland deal, the income-tax department was asking the ministry about the existence of middlemen in the deal.

In Italy, a probe into the deal has ended up in the arrest of the CEO of Finmeccanica, parent company of Agusta, and the revelations include the possible involvement of the cousins of former Air Chief SP Tyagi.

Para 32 of the fact sheet released by the government states: “In November 2012, a letter was received in MoD (Ministry of Defence) from the Director, Income Tax (Investigations), regarding allegations against Indians possibly involved in the deal as middlemen and seeking information about them.  The current status of the case was conveyed to the income tax authorities in January 2013; in return, MoD asked income tax to share with it any ‘credible information’.”

By its own revelation, the Ministry of Defence thus took three months, from November to January, merely to inform the tax department to come up with “credible information”.

Wasn't me: Can the Defence Minister really claim innocence? PTI

Wasn't me: Can the Defence Minister really claim innocence? PTI

A plain reading of the sequence of events suggests that the defence ministry and Antony did not act on the available information given by the tax department on middlemen making money in the AgustaWestland VVIP chopper deal. Firstpost had earlier reported on Antony’s written reply in the Lok Sabha on reports about the existence of middlemen and alleged kickbacks.

The narration in the government's fact sheet, which lists out the chronology of events, suggests indirectly that if at all there was any whiff of irregularity in the deal, it happened when modifications were suggested to the RFP (request for proposal) in 2003 during the NDA regime. At that time, the then National Security Advisor (NSA) Brajesh Mishra had objected to the fact that there was only a single vendor in the deal, and this called for a change in the altitude specifications for the helicopter from 18,000 feet to 15,000 feet in order to bring in more bidders.

Subsequent deliberations, between March 2005 and September 2006, between the Indian Air Force, the NSA, the SPG, the PMO and the MoD, resulted in changes being incorporated into the RFP. During this period SP Tyagi was Air Chief Marshal, Pranab Mukherjee was Defence Minister, BV Wanchoo was SPG chief (now Goa Governor) and MK Narayanan was the NSA (now West Bengal Governor).

But this subtle effort to shift the focus to modification in the RFP is not very material, since the issue is whether kickbacks were paid or not in the deal. Focusing on modifications in the technical requirements leads nowhere and only suits the political sensibilities of the UPA. It will only divert attention from the money trail.

It is interesting to see how the Ministry of External Affairs responded to the situation. From the facts stated in the fact sheet, it appears as though the MEA acted as a mere post office and, when pressed for information, it even opined that “news reports alone could not be the basis for the Ministry of Defence to make any preliminary determination”.

Paras 27 and 28 of the fact sheet throw some interesting light: “Since factual information was difficult to arrive at, Defence Secretary wrote to Secretary (West), MEA, in October 2012 reiterating the importance of the need to get information from the Italian authorities so that MoD could take further necessary action in this regard…... MEA’s response again was that the matter had been taken up with the Italian side, which called for ‘reliable information’. Moreover, "news reports alone could not be the basis for the Ministry of Defence to make any preliminary determination".

But when it came to putting up a defence, another set of reports came in handy. The factsheet says: “MoD also noted the report in The Hindu of 28.2.2012 that, quoting Finmeccanica, states that its subsidiary AgustaWestland is not involved in 'any irregularity in the deal’. Subsequently, MoD received more than one communication from M/s AgustaWestland confirming that the statements in the press are 'completely  unfounded and have been issued with malicious intent’ and that 'no commissions whatsoever were paid in the case."

Interestingly, when things blew up in Italy and Giuseppe Orsi, CEO of Finmeccanica, was arrested on 12 February, a CBI investigation was ordered merely on the basis of media reports. Also, what the CBI initially got from the MoD was only clippings from media reports. It is still in the process of getting relevant files from the ministry.

Updated Date: Feb 15, 2013 14:21 PM

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