Gun with a stinging recoil

COVER UP: Both the Indian and Swedish governments were reluctant to delve deep into the scandal. Not only was Rajiv himself implicated, but there were whispers that Palme too might have had a stake in the underhand deals. Bofors, the Hindujas and Chadha stonewalled all attempts to get at the truth. Then Rajiv announced a Joint Parliamentary Committee probe. But with the entire opposition boycotting it, the panel appeared just a Congress appendage, headed by B Shankaranand and filled with Congressmen. Their verdict was predictable: No commissions had been paid, neither had agents been involved. The JPC accepted Bofors’ explanation that the Swiss bank deposits unearthed pertained to ‘‘winding up charges’’ for terminating services of agents as agreed upon by the prime ministers of the two countries.

CAUGHT: With the scandal becoming a political avalanche, and with talk of Rajiv’s personal complicity in the incident, the 1989 election campaign became a referendum on corruption—and the Congress lost the faith of the people. The new man elected to head the government, V P Singh, was expected to get to the bottom of the affair. After all he was seen as Mr Clean, having parted ways with Rajiv on issues, among others, of transparency and corruption. Singh’s government sent letter rogatories to Sweden for bank documents and seemed honest about uncovering the facts. But before he could go further, Singh lost his job to Chandra Shekhar, who was so much at the mercy of the Congress to even think of taking the probe forward. New elections were called in 1991, and during campaigning Rajiv was killed by an LTTE suicide bomber. The most blatant official attempt at railroading the Bofors probe came thereafter. P V Narasimha Rao’s external affairs minister Madhavsinh Solanki was caught passing a note to his Swiss counterpart, asking that country to halt the investigation. Solanki resigned and retired to never, till date, say a word about the affair.

FINALLY THE DOCUMENTS: Rao led his government to its full term, but lost the elections in 1996. By this time, the diary of Bofors president at the time of the deal, Martin Ardbo, was a “raging bestseller”. In it, the Swede had mentioned, in childish code, his interactions with various people transacting the sale. There were references to N, R, GPH, Hansens and a mysterious Q. These were readily interpreted to mean Nehru (Arun Nehru), Rajiv, G P Hinduja, the Hindujas and Quattrocchi. In power at this time was the United Front government headed by H D Deve Gowda. His hand-picked CBI chief Joginder Singh took over the case and managed to finally get the papers from Zurich and Geneva that could nail the recipients of the kickbacks. In 1997, the CBI reported that commissions had actually been paid in the deal. Then, in a delicious irony, came the 1999 Kargil war, in which the Bofors gun more than proved its mettle, becoming iconic of a victory in inhospitable regions.

CHARGESHEET: Under Atal Bihari Vajpayee that year, the CBI filed its first chargesheet. It read: ‘‘Investigation into the allegations conducted so far in India and abroad has revealed that the accused—Mr S K Bhatnagar, Mr W N Chadha alias Win Chadha, Mr Ottavio Quattrocchi, Mr Martin Ardbo, Messers AB Bofors and Rajiv Gandhi—entered into a criminal conspiracy with some other persons in New Delhi, Sweden, Switzerland and other places during 1985-87 and thereafter with the objective of getting the Indian Government to award a contract in favour of AB Bofors for the purchase of 400 155 mm FH-77B gun systems by abuse of official position by the aforesaid public servants and for causing wrongful gain to private persons/others and corresponding wrongful loss to the Government of India in the deal.’’ The Hindujas were chargesheeted in October 2000.

BURIAL: The case wound on. Bhatnagar died in 2001 and a few months later, Win Chadha. In 2003, India asked Britain to freeze Quattrocchi’s account in which 3 million Euros and $1 million of the alleged original Bofors payout to AE Services remained. Two years later came the judgement. In February 2005, the Delhi High Court gave a clean chit to Rajiv, saying there was ‘‘no convincing evidence’’ of his complicity. In May 2005, the high court quashed the case against the Hindujas. Ninety days later, with the CBI failing to appeal, the case was deemed ‘‘buried’’.

Q and some unanswered As
Of the three firms to which Bofors paid Rs 64 crore—Svenska, Pitco and AE Services—the last named intrigued investigators the most. Svenska and Pitco were shown to be owned by Win Chadha and G P Hinduja respectively. Documents showed that at the time when the French Sofma seemed to be forging ahead, having cleared 18 parameters to Bofors’ 11, the Swedish company hired AE Services to lobby for it in 1985. It was promised a 3 percent commission if it could win the contract for Bofors.

AE Services was obviously a front company that received the commissions as investigation were to prove. It was so skillfully set up that the CBI was unable to trace it owners. Chitra Subramaniam, however, was able to beat the obfuscation and find the trail leading to Colbar Investments. The Swiss bank where Colbar maintained an account had Ottavio Quattrocchi listed as a beneficiary.

Quattrocchi resided in India from 1964 till the Bofors heat made him hightail it to Malaysia in 1993. The CBI fought for his extradition, but lost the case in December 2002. However, in July 2003, India got Britain to freeze Quattrocchi’s bank accounts. It was the defreezing of this deposit on January 11 that brought the never-ending Bofors saga once again into the headlines.

Additional Solicitor-General B Dutta, a law officer under Law Minister H R Bhardwaj, informed the Crown Prosecution Service—handlilng the case for the CBI in Britain—that the Indian agency had no evidence to link the 3 million Euros and $1 million in two bank accounts to the Bofors payout. The British authorities accordingly defroze the accounts.

Quattrocchi is a politically sensitive name in India. A friend of Rajiv and Sonia, he often flaunted his closeness to them to get things done. That is why a number of questions still surround the Q affair. Did Bofors home in on the Italian to get the gun contract, knowing he had the ears of the prime minister? Did AE Services and Quattrochhi receive the money given by Bofors on behalf of the Congress and Rajiv or did Quattrocchi use his proximity to the Gandhis to make money for himself? Only a part of the original sum paid to AE Services has been accounted for in transaction documents, so where did the rest go?