Middleman in Rafale deal kicks up dogfight between Congress and BJP

The suspect payment was detected by French anti-corruption agency, Agence Française Anticorruption (AFA), during audit, revealed Mediapart.

Published: 06th April 2021 03:19 AM  |   Last Updated: 06th April 2021 08:32 AM   |  A+A-

Rafale fighter jets

Rafale Fighter Jets. (Photo | Shekhar Yadav, EPS)

Express News Service

NEW DELHI: The newly inducted Rafale fighter jets flew into a fresh storm with a French online journal claiming that manufacturer Dassault Aviation paid 1 million euro to an Indian middleman as gift after the Rs 58,000 crore government-to-government deal in 2016 for 36 jets for the Indian Air Force.

The suspect payment was detected by French anti-corruption agency, Agence Française Anticorruption (AFA), during audit, revealed Mediapart.

It identified the recipient as Defsys Solutions, a group run by a Gupta family, including Sushen Gupta, who has been under investigation over his role in the AgustaWestland VVIP chopper scam.

The report kicked up a political storm with Congress demanding a thorough probe and the BJP rejecting charges of corruption as completely baseless.

AFA inspectors came across the suspect payment of 508,925 euros under the head gifts to clients, for which Dassault produced an invoice from Defsys.

Mediapart, citing the AFA report, said, “This invoice, which related to 50% of the total order (1,017,850), was for the manufacture of 50 (mega sized) models of the Rafale C, with a price per unit of €20,357.”

Chief Congress spokesperson Randeep Surjewala claimed that the report has proved that there was corruption in the biggest defence deal, and asked why action should not be taken against those involved, including Dassault Aviation, for violating the defence procurement procedure, which clearly entails that there will be no middlemen.

Hitting back at the Congress, BJP leader and Union minister Ravi Shankar Prasad dismissed as "completely baseless" the allegations of corruption in the Rafale deal and said the opposition party made a big issue of the defence deal in 2019 Lok Sabha polls but lost badly.

The Supreme Court had rejected a demand for a probe in the purchase of the fighter aircraft and the CAG also found nothing wrong, Prasad said.

The allegations of corruption were "completely baseless", the minister said, and suggested that a report in the French media about the alleged financial irregularity in the deal may be due to "corporate rivalry" in that country.

According to the Mediapart, its report was based on an investigation by the country's anti-corruption agency Agence Francaise Anticorruption (AFA), which found that after inking the deal, payment was made by the Dassault Aviation, the manufacturer of Rafale fighter jets.

As per the report, the manufacturer has not been able to answer the queries posed by the AFA.

There was no immediate reaction from the Defence ministry on the French media report.

Surjewala said their leader Rahul Gandhi's oft-repeated allegations of corruption in the deal were proved correct now.

He said as per the French portal's report, an investigation conducted AFA has revealed that after signing of the deal in 2016, Rafale's manufacturer Dassault allegedly paid 1.1 million euros to Defsys Solutions, which is an Indian company.

"Does it now not require a full and independent investigation into India's biggest defence deal to find out as to how much bribery and commission in reality, if any, was paid and to whom in the Indian government," he asked at a press conference.

"Will Prime Minister Narendra Modi answer to the nation now?" he asked.

In his counter-attack, Prasad said,"the Congress is raising the Rafale issue again. It lost in the Supreme Court. They campaigned in the 2019 polls on the Rafale issue, threw all kinds of abuses at the prime minister and still lost. How many seats did it get."

The minister also noted that Sushen Gupta, the middleman whose name has cropped up in the French report on the Rafale deal, was arrested in the AgustaWestland case by the Enforcement Directorate in 2019.

In this probe, the names of many Congress leaders had surfaced, Prasad said and accused the Congress of trying to "weaken" the security forces.

The Indian Air Force received a fleet of fighter aircraft in Rafale after 30 years, he said, adding that had it been there during the time of the Balakot operation to target terrorists in Pakistan then Indian aircraft would not have to cross the borders to carry out the strike.

The Congress leader said the Defence Procurement Procedure (DPP) as also the stated Indian government policy envisage that there will be an Integrity Clause in every defence purchase contract which clearly states that there can be no middleman or payment of commission or bribe.

Surjewala said that as per the DPP, any evidence of middleman or commission or bribery has serious penal consequences including the banning of the supplier, cancellation of contract, registration of an FIR and imposition of heavy financial penalties on the company.

"Has it not vitiated the Rafale deal entailing imposition of heavy financial penalties on Dassault, banning of the company, registration of an FIR and other penal consequences," he asked, while citing the example of Agusta Westland chopper deal where the CBI has already initiated action.

He asked whether the payment of 1.1 million euros shown by Dassault as 'Gifts to Clients' in reality a commission paid to the middleman for the Rafale deal.

"How can middleman and payment of commission be permitted in a government-to-government Defence Contract or in any Defence procurement in India in violation of the mandatory Defence Procurement Procedure," he asked.

The Congress leader alleged that "India's biggest defence deal involving the purchase of 36 Rafale fighter jets from the Dassault Aviation is a sordid saga of 'loss to public exchequer, squandering national interests, propagating the culture of crony capitalism and shrouded in secrecy by negating the mandatory aspects of procurement.

" Alleging that there was lack of transparency and opaqueness in this government, Surjewala claimed that the Prime Minister went ahead and purchased the aircraft without following any procedure, and has also refused to submit himself to an investigation.

The government did not provide full documents to the CAG, he claimed.

"India has a no middleman, no commission stated policy. Why can't the present Prime Minister order an impartial investigation now, so that we know who in his Government took the bribe and the commission and how many thousand crores, if any," he said.

Asked what would be the next step of the Congress, he said, "we will wait for next 48 hours for the Government to react and then take the next step.

(With PTI Inputs)


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