How Congress perfected corruption

During the Nehru era, the Congress often collected funds from industrialists and businessmen, which at times landed the party and the government in trouble.

Published: 26th March 2019 04:00 AM  |   Last Updated: 26th March 2019 07:14 AM   |  A+A-

The vitriol launched by Congress president Rahul Gandhi towards Prime Minister Narendra Modi and his often-repeated diatribe “Chowkidar Chor Hai” has brought the political discourse in the country to a new low. It also brings to the fore the debate on corruption, an issue on which no member of the Nehru-Gandhi family has the moral authority to talk about.  Here is a quick look at how the family funded their politics.

During the Nehru era, the Congress often collected funds from industrialists and businessmen, which at times landed the party and the government in trouble. For example, when Mundhra, an industrialist who funded the party in the 1950s, ran into financial problems, he signalled to the government that it was time for payback. Nehru obliged and directed the LIC to buy his companies’ shares at inflated prices. Finance Minister T T Krishnamachari, who was obviously acting on orders from above, lost his job when the truth came out.

Later, after the Congress split in 1969, Indira Gandhi began relying heavily on the communists for funds. And naturally, the Soviets came to her rescue. Vasili Mitrokhin, who was in charge of the KGB Archives, has made explosive revelations about how Moscow funded the activities of the Congress ahead of the 1971 elections. They even had moles in her Cabinet.

Many who have held key positions in Indian politics, government, bureaucracy, and industry in the post-1970 era provide us invaluable insight into how the grand old party went about the business of funding its activities and election campaigns.

These witnesses to that period say the Congress decided on a new mode of raising funds—via commissions collected on mega international defence and other contracts. B G Deshmukh, who was the cabinet secretary between 1986-89 has written an enlightening autobiography: A Cabinet Secretary Looks Back.

Deshmukh says “the genesis of the Bofors affair lies in the practice initiated by Indira Gandhi and further refined by her son Sanjay for collecting funds for the Congress Party. Till the middle of the 1960s, during the regime of Jawaharlal Nehru, the collection of funds for the party was more transparent
and business houses were also permitted to make open donations”.

Indira, he says was in dire need of funds to fight polls and establish herself as the undisputed leader of her party. For this, she depended on loyal supporters like Rajni Patel and Vasantrao Naik. “When she had established her supremacy in Indian politics, she decided that a far better way to collect funds was through claiming cuts from foreign deals. Sanjay Gandhi perfected and refined this further from 1972 onwards.”

Deshmukh says when Indira came back to power in 1980, this system was fully perfected. Trusted officers were posted to key ministries and advised on how to finalise deals.

The second unimpeachable witness is B K Nehru, a distinguished civil servant, ambassador and governor and uncle of Sanjay and Rajiv Gandhi. In his autobiography Nice Guys Finish Second, he recalled that at Sanjay’s cremation he had asked Rajiv “whether the money Sanjay had collected allegedly for the Congress was safe”. Rajiv said, “all they found in the almirahs of the Congress office was `20 lacs”. Nehru then asked Rajiv how much Sanjay had. “He (Rajiv) held his head in his hands and said unaccounted crores”.Two more equally unimpeachable witnesses to this era are former President

R Venkataraman and industrialist J R D Tata. In his autobiography My Presidential Years, Venkataraman recounts a conversation he had with Tata. Latter said it was quite possible Rajiv or his family members did not take commissions from Bofors but “it would be difficult to deny the receipt of commissions by the Congress Party”. That was because “he (Tata) felt that since 1980, industrialists had not been approached for political contributions and that the general feeling amongst them was that the party was financed by commission secured on deals”.

Since this was the established mode of fund collection, Bofors was certain to happen. In this scandal, Rajiv and others were accused of taking kickbacks when India purchased field guns for the Army from the Swedish arms manufacturer Bofors. Rajiv vehemently denied this charge in Parliament. However, the Nehru-Gandhis have never been able to explain why Bofors remitted $7.3 million to the account of Maria and Ottavio Quattrocchi.

The Quattrocchis moved this money around several banks in various locations. It was finally traced to the Channel Islands in the UK The Vajpayee government got the UK government to freeze this account. However, the Manmohan Singh government asked London to withdraw the order, resulting in the Quattrocchis eventually getting away with the loot. Why did an Italian businessman knock off a commission when India bought field guns for its Army? Why did Sonia Gandhi get the Manmohan Singh government to defreeze Quattrocchis’ account?

And as if this was not enough, there are the Volcker Committee’s conclusions on the “non-contractual beneficiaries” of Iraqi oil sales under the United Nations Oil-for-Food Programme, which says the Iraqi dictator Saddam Hussein had also funded the Congress. Further, it seems Saddam Hussein’s Iraq was just one of the two nations that had supported Indira Gandhi’s dictatorship during the Emergency! Do we need to say more?

Chairman, Prasar Bharati


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  • gopal

    he is RsS connected guys and trying save corrupt Modi Chor chokridar
    2 years ago reply
  • sanjoy

    An excellent article by SuryaPraksh
    2 years ago reply
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