Deals of four years escape Defence probe

Earlier in the year, on February 5, Defence Minister George Fernandes spoke to Chief Vigilance Commissioner N. Vittal and asked him to carry out investigations into all important defence deals after 1985. The urgency was apparent as the minister ordered the sweeping probe on telephone on a Saturday. But his ministry (MoD) in a subsequent letter, apprising the services of the probe, has said that only cases after 1989 were being referred to the CVC.

There is no mention of the year 1985 at all. A senior ministry official speaking to The Indian Express

said that the minister was advised to change the year from 1985 to 1989 because it was only in April 1989 that orders were passed to ban middlemen and agents from defence deals. But he too refused to comment on why had the minister earlier decided on 1985 as the cut-off year to order the probe.

However, sources in the services insist that middlemen are not the only problem in the defence deals. “Middlemen in defence deals are only a part of the malice. This extends beyond to wrongful pricing and purchases without requirement. This has been conveniently brushed under the carpet,” sources said.

“In several deals, a different price has been quoted for us (India) and a different price for other countries. Also there have been complaints of considerations other than ability of equipment playing a role in purchases. If the CVC or the CBI only investigate the role of middlemen all these facts will never emerge. Then this entire process will be an exercise in futility,” sources added.

“This is just hair-splitting,” said a senior MoD official about the change of date from 1985 to 1989. “The minister’s orders have to be seen in its entirety. The probe was ordered in the context of a debate in Parliament in which members said that despite a ban on middlemen there was no deal contracted without agents. Therefore, Fernandes ordered the probe into the role of agents,” he said. “Of course, the CVC is independent to probe whichever deal it wants even before that,” he added.

“Raksha Mantri (Fernandes) has decided that all major procurement cases which have been finalised after Government Orders (April 1989) banning agents, middlemen or middle companies in defence procurement, should be referred to the CVC. Our focus is therefore the middlemen,” an official in the MoD said. “But that is not all. The allegations levelled by Rear Admiral Suhas Purohit in his petition have also all been sent to the CVC for investigation,” he added.

Officials conceded that initially the probe ordered by the minister was far too sweeping and had to be streamlined. “There had to be some limits set somewhere. There had to be a cut-off date especially since the CVC would also be probing such cases for the first time,” the official said. In fact, the MoD has also directed the services to brief the CVC on the procurement process.