Aircel-Maxis deal and Chidambarams

[These series of articles on Chidambarams link in Aircel-Maxis deal appeared in 'The Pioneer' on April-May 2012]

Swamy claims PC used clout to benefit son


April 27, 2012

Janata Party president and 2G scam crusader Subramanian Swamy has alleged that Home Minister P Chidambaram used his office as Finance Minister in 2006 to help his son Karti get a portion of the booty in the Rs 4,000 crore Aircel-Maxis deal. Swamy has asked Prime Minister Manmohan Singh to dismiss Chidambaram from the Union Cabinet and direct CBI to bring the father-son duo under the ambit of on-going probe in the Aircel-Maxis deal.

Addressing a Press conference on Thursday, Swamy released documents of Registrar of Company (RoC) pertaining to “Karti-controlled companies”, and alleged that Foreign Investment Promotion Board (FIPB) under Chidambaram cleared the Rs 4,000 crore Aircel-Maxis deal only after his son got “five per cent shares in C Sivasankaran’s Aircel Televenutre Ltd”.

Meanwhile, according to PTI, Karti Chidambaram has dismissed Swamy’s charges. “There is no no truth. None of the companies in which Karti has any interest holds any equity in nor has given any loan to any telecom company,” sources close to Karti said.

Producing a set of documents, Swamy claimed that Karti has 94 per cent shares in a company called Ausbridge Holdings Investments Pvt Ltd, which has majority stakes in two other companies, namely Advantage Strategic Consulting Pvt Ltd and Kaiser Surya Samudra Resorts Pvt Ltd.

Swamy said RoC documents of Advantage Strategic Consulting Pvt Ltd, showed that before March 31, 2006, it had transferred Rs 26,00,444 to Siva’s Aircel Televentures Ltd as loans and advances. “This payment was obviously made to acquire shares of Aircel Televentures, which controlled the Aircel Ltd and Aircel Cellular Ltd,” he said.

What is bizarre is the fact the loan amounted to Rs 26,00,444 where as in normal cases such transaction should have been a round figure.

After Maxis acquired majority stakes in Aircel by paying Rs 4,000 crore to the holding company Aircel Televentures, the latter changed its name to Siva Ventures Ltd. Swamy said that for its five per cent shares, Karti’s company must have pocketed Rs 200 crore from this Malaysian booty.

“Chidambaram approved the FIPB clearance of Aircel-Maxis deal in May 2006 after his son got around five per cent shares in Siva’s company. The accounts of Siva Ventures showed that after the transfer of money from Maxis, the company gave a loan of Rs 1,300 crore to certain associate companies without specifying their names. This is a mystery. Where did such huge amount go?”

In a letter to the Prime Minister seeking dismissal of Chidambaram, Swamy said that CBI’s ongoing probe in the Aircel-Maxis deal is limited only to Maran brothers. “During March first week this year, at a Press conference in Chennai, I announced the names and details of several companies where Karti P Chidambaram is a director. Within few days on March 9, 2012, Karti resigned from the Directorship of one company called Ausbridge Holding and Investments Pvt Ltd, where he had more than 94% shares.

“After I checked the accounts of this company, I found that his company has majority shares in two companies, namely : Advantage Strategic Consulting Pvt Ltd and Kaiser Surya Samudra Resorts Pvt Ltd. The accounts of these companies were totally manipulated and some Balance Sheets were filed even after five year,” wrote Swamy to Prime Minister in his three-page letter detailing the “doubtful financial transactions of list of Karti controlled companies and their dubious operations.”

“It is not possible for the CBI officers who mainly belong to IPS cadre to probe into Home Minister and his son’s role, even though they have solid proof. In the ongoing probe on the Aircel-Maxis deal, where CBI had registered FIR, the role of P Chidambaram and his son Karti should also be through probe. Such kind of impartial probe is not possible for CBI Officials, when P Chidambaram is Home Minister, who controls their cadre-IPS,” said Swamy.

The 2G crusader announced that he would soon approach courts, demanding to probe Chidambaram and son. “My case is reserved for orders on making him as co-accused along with A Raja in Supreme Court. Now I have produced Chidambaram’s son’s financial transactions during the Aircel-Maxis deal period. If CBI can fix Karunanidhi’s daughter for having financial transactions with Balwa related company, the same rule will apply to Chidambaram’s son also. CBI is aware of Karti’s link in the Aircel-Maxis deal. That is why they are going slow in Maran case,” said Swamy.

Swamy also produced the RBI’s monthly report for the month of September 2011 about outward FDI flow. According to this report, Advantage Strategic Consulting Pvt Ltd has a wholly owned subsidiary in Singapore, named as Advantage Strategic Consulting Singapore Pte Ltd. The report shows a transaction of 1.8625 Million US dollar from Indian parent company to Singapore based subsidy. “This is only a transaction of just a month. I had sought RBI for the entire transaction from 2006. These huge transactions are not shown in the RoC documents of Indian company,” he said.

Swamy also produced documents of another “Karti controlled company” Kaiser Surya Samudra, which owns 4.62 hectares near the Mahabalipuram beach, near Chennai. “This transaction took place during Kanimozhi’s financial transaction with Balwa during 2008-2009. This company got approval from Karunanidhi government in lighting speed in the sensitive beach resort to construct 100 luxurious room,” alleged Swamy.

“But the RoC documents are silent on the source funds of this Rs.100 crore worth project. It shows only a pittance of Rs.1.5 lakh as loan from Home Minister’s wife Nalini Chidambaram,” added Swamy, urging Tamil Nadu Chief Minister to order a probe on the huge land purchase in the sensitive beach area.

Ministry babus roped in for propaganda

April 28, 2012

While Home Minister P Chidambaram continued his stony silence on Friday over Janata Party president Subramanian Swamy’s allegations against him and his son Karti on Aircel-Maxis deal, the Home Ministry’s Media Wing distributed a Press release on behalf of a Chartered Accountant representing a company allegedly controlled by Karti. Swamy has alleged that this company benefitted from the deal.

Interestingly, the handout of the Chartered Accountant distributed from the Home Ministry’s North Block office also included a PTI report on the CA’s version on Swamy’s allegations and plans to file a defamation case.

The journalists were asked to collect CA’s version from the MHA media wing’s office. The officials who called the reporters refused to fax or email the handout. Obviously, this was a clever ploy to avoid any proof of Home Ministry’s involvement in putting out Karti’s defence.

The Press note was signed by R Balachandran, Chartered Accountant of Advantage Strategic Consulting Private Ltd. This company was controlled by another company called Ausbridge Holdings and Investments Private Limited, where Karti has more than 94 per cent shares. Swamy alleged that the Advantage Strategic Consulting Pvt Ltd “got five per cent stakes in C Sivasankaran’s company to share the booty of Rs 4,000 crores from sell of Aircel.”

“My client M/s. Advantage Strategic Consulting Private Limited had taken notice of the press meet held by Mr Subramanian Swamy, on April 26, 2012. The company states that they have placed the matter in the hands of their lawyers to take appropriate legal action immediately,” said R Balachandan, the Chartered Accountant. The questions is why Home Ministry officials were forced to distribute the press note of a private person, while the Government of India rules of conduct of civil servants strictly prohibit such activities.

Meanwhile, ridiculing the “defamation notice threat”, Swamy, said that he would welcome it as opportunity cross-examine Karti in the court of law. Swamy also said that he would soon reveal more documents on “Nalini Chidambaram (Home Minister’s wife) and Karti link in Aircel-Maxis deal”.

“The threat of a defamation case issued by company officials on behalf of Mr Karti Chidambaram with regard to my allegation of his involvement in the 2G Spectrum Scam is laughable. I would welcome an opportunity to cross-examine Karti in the court of law which will save me the trouble of approaching the Special 2G Spectrum court for filing a fresh private complaint.

“In the meantime I demand that the mother and son duo of Mrs Nalini Chidambaram and Karti to explain the number of trips they have made to Malaysia during 2005-2007, and whether the CEO or any other official of Maxis received them and put them in hotels,” said Swamy in statement issued here.

Govt’s defence of Chidambaram rings hollow

May 8, 2012

The Government’s claim that as Finance Minister, P Chidambaram did not delay Foreign Investment Promotion Board (FIPB) approval to the Rs 4,000 crore Aircel-Maxis deal is far from the truth. While the actual clearance was given on October 3, 2006, the Government on April 28 claimed that FIPB cleared the Maxis acquisition of Aircel on March 7, 2006 itself.

The Government’s latest defence of the Home Minister came in response to Janata Party president Subramanian Swamy’s allegations that under Chidambaram as Finance Minister in 2006, the FIPB sat on the Aircel-Maxis deal for several months.

Dismissing the allegations as “totally baseless”, the Ministry of Finance on April 28 said the FIPB recommended the proposal to acquire Aircel in the meeting held on March 7, 2006 and a formal letter of approval by the Ministry was issued on March 20, 2006.

“From the fact stated above, it will abundantly clear that there was no delay whatsoever. It is unfortunate that the baseless allegations should be made without verifying facts,” said the Ministry of Finance on April 28 giving the entire timeline of approval.

However, inquiry by The Pioneer revealed that it was the Government, which either did not verify the facts or deliberately concealed it to save Chidambaram.

The documents show that the FIPB recommended the deal only on October 3, 2006 in its meeting chaired by Chidambaram and the related Press release was issued only on October 17, 2006.

The documents available with The Pioneer and Press releases on the FIPB approvals, still available on the website of Press Information Bureau, have put the Government in a spot. No one from the Finance Ministry has come forward to respond to clarifications sought by The Pioneer through an email questionnaire sent five days ago to the Joint Secretary of Infrastructure of Investment division, who heads the FIPB.

A senior official of the FIPB said: “Please don’t drag us into this politically sensitive issue.”

Coming out with a fresh expose into the deal where former Telecom Minister Dayanidhi Maran’s role is under CBI probe, Swamy alleged that a company controlled by Chidambaram’s son Karti got five per cent stake in Sivasankaran’s Aircel Televentures to corner part of Rs 4,000 crore that the Maxis paid for 74 per cent stake in Aircel.

It was alleged that Chidambaram withheld the FIPB clearance to the deal till his son got the five per cent shares in Siva’s company.

Reacting to the allegations, the Finance Ministry issued a detailed Press release titled — “Government denies allegations.”

“Allegations have been made that the proposal of M/s Global Communication Services Holdings Ltd, Mauritius (a wholly owned subsidiary of M/s Maxis Communications Berhad) to acquire 73.99 per cent equity in M/s Aircel Ltd was delayed by the then Finance Minister in order to benefit certain persons.

“On 7.3.2006, the matter was placed before the meeting of the FIPB. DoT conveyed its support to the proposal at the meeting. FIPB recommended the proposal for approval on 7.3.2006 and file was moved by Deputy Secretary on 10.3.2006. The minutes of the FIPB meeting were placed before the then Finance Minister on 13.3.2006 and he approved the same. The formal letter of approval was issued by the Ministry of Finance on 20.3.2006. From the facts stated above, it will be abundantly clear that there was no delay whatsoever. It is unfortunate that baseless allegations should be made without verifying the facts,” claimed the Government Press release. According to this Press release, the FIPB, under Chidambaram, approved the proposal in just two-and-a-half months.

But The Pioneer’s investigation shows that no such proposal was tabled in the March 7, 2006 meeting of the FIPB. A Press release dated March 14, 2006 still on the PIB website, has no mention of the Aircel-Maxis deal.

The vital information that Government concealed is that at the March 7, 2006 meeting of the FIPB, clearances were given to another company with a similar name. The company was BT Global Communication (Mauritius) Ltd.

It was only on October 3, 2006 that the FIPB meeting, chaired by Chidambaram, cleared the deal. Item number 15 and 16 of the October 17, 2006 Press release available at the PIB website states about the FIPB clearance to the Maxis investment in Sivasankaran’s companies Aircel and Dishnet.

The FIPB also did not show the amount of foreign investment and kept the concerned column blank. Normally, all FIPB clearances would specify the value of foreign investment.

Govt trapped in own web of deceit

May 9, 2012

The UPA Government finds itself caught in a web of deception in its bid to defend Home Minister P Chidambaram’s role in the Aircel-Maxis deal. On Tuesday, reacting to The Pioneer report on the gross discrepancies on the FIPB approval timing and delay of Aircel-Maxis deal, the Government insisted that the first approval was given on March 7, 2006 and second one for downstream investment on October 3, 2006. Maxis’ subsidiary of Mauritius-based Global Communication Services Holding Ltd invested in Aircel, as claimed by the Government.

However, records nail the Government lie. The facts remain that on March 7, 2006, the Government gave approval to two companies — from USA and Singapore — to raise their stake in Aircel/Global Communication Services Holding Ltd, both Indian firms.

This is established by a PIB Press release dated March 14, 2006 which states that under ‘Economic Affairs’ category (item no : 7 of the PIB Press release on FIPB approvals), M/s Century Telephone Enterprise Inc of USA and M/s Rediongton Pte Ltd were given sanction to enhance their foreign equity of 49 per cent in Aircel/Global Communication Services Holding Ltd to 74%. The value of foreign investment was shown as only Rs 180 crore. Curiously, in this case, Global Communication Services Holding Ltd is shown as an Indian investor along with Aircel.

The PIB release dated March 14, 2006 has no mention of Global Communication Services Holding Ltd acquiring any stake in Aircel. The Pioneer on Tuesday reported that the FIPB approval for the acquisition of Aircel by Global Communication Services Holding Ltd was given only on October 3, 2006.

While insisting that the first FIBP clearance was given to deal on March 7, Government’s Tuesday release claimed that on October 3, FIPB gave subsequent approval for downstream investment by Global Communication Services Holding Ltd in Aircel.

But, throughout the controversy, the Government has not come out with any documents to show that the FIPB under Chidambaram on March 7 gave any clearance to Global Communication Services Holdings Ltd to make any investment in Aircel. Unless the Government comes out with clear evidence to establish this, Chidambaram will find it difficult to deny allegations levelled by the Opposition that he purposefully delayed the clearance to benefit his son Karti.

Terming The Pioneer report on Tuesday as “factually incorrect and totally baseless” the Government on behalf of Ministry of Finance reiterated that FIPB chaired by Chidambaram as Finance Minister approved the deal on March 7, 2006. “Government had earlier issued a Press release on April 28, 2012 regarding the foreign investment made by M/s Global Communication Services Holdings Ltd, Mauritius to acquire 73.99 per cent equity in M/s Aircel Ltd. The contents of that statement are correct and are reiterated,” said the Press release titled “Clarification on AIRCEL issue”.

The Government must also clarify on the companies — Century Telephone Enterprise from USA and Rediongton Pte Ltd. According to the CBI FIR, Maxis invested around Rs 4,000 crore in Aircel by May 2006. Then how did FIPB arrive at foreign investment figure of just Rs 180 crore for increased 25 per cent shares?

Meanwhile, on the same day, March 7, 2006, FIPB under “Telecommunication” category (item No: 19) approved foreign investment of similar named company called BT Global Communication (Mauritius) Ltd. This company got approval to acquire 74 per cent in an unnamed Delhi-based company’s landline telephone operations for around Rs 9 crore.

It is also a mystery how in October 3, 2006, Global Communication Services Holdings Ltd, which was shown as an Indian entity on March 7, became a foreign investor in Aircel and Dishnet on October 3.

Maxis’ stake declaration demolishes PC defence

May 15, 2012

For days Home Minister P Chidambaram has pleaded innocence in the Aircel-Maxis deal, but new facts show that the acquisition of Aircel by the Maxis in 2006 was illegal. The deal, which took place when Chidambaram was the Finance Minister, violates Indian laws. While domestic laws place a cap of 74 per cent on foreign investment in telecom sector, in the Aircel-Maxis deal, the latter acquired nearly 100 per cent stake in three tranches.

Equally shocking is the fact that a probe instituted by the Finance Minister and Department of Telecom in early 2007 to look into this violation, has reached nowhere. The Government has so far not initiated any action against Maxis.

On March 15, 2006, Maxis declared to the Malaysian Stock Exchange that it proposed to acquire 99.714 per cent in Aircel. This was before the Foreign Investment Promotion Board (FIPB) — under Chidambaram — cleared the so-called final acquisition on October 3, 2006.

“Aircel Transactions comprising:

(I) Proposed acquisition by Global Communication Services Holdings Ltd (GCSHL), a wholly-owned subsidiary of Maxis, and Deccan Digital Networks Private Limited (JVC), a proposed joint venture company of Maxis in the Republic of India, of 94,864,865 and 85,135,135 equity shares of 10 Indian Rupees each in Aircel Limited (Aircel), a company incorporated in the Republic of India (“Aircel Shares”), representing 39% and 35% respectively, of the enlarged issued and paid-up share capital of Aircel from Aircel Televentures Limited for a cash consideration of $422 million and $378 million respectively.

(II) Proposed joint venture between GCSHL and Sindya Securities & Investments Private Limited in relation to their participation in the JVC.

III) Proposed put and call options over GCSHL’s 63,243,243 Aircel Shares representing 26% of the enlarged issued and paid-up share capital of Aircel for a cash consideration of US$280 million (“collectively Aircel Transactions”),” said the declaration made by Maxis to Malaysian Stock Exchange (Bursa Malaysia) on March 15, 2006.

Maxis filed this declaration to stock exchange through their banker RHB Sakura Merchant Bankers. This declaration shows that Maxis proposed to purchase Aircel shares in three tranches --- first 39 per cent and then 35 per cent and last 26 per cent, at around Rs 4,000 crore. But another document filed by the Maxis to the Malaysian stock exchange says the last tranche was proposed to be of 25.714 per cent share in Aircel.

The declaration also shows that apart from direct purchase, Maxis acquired Aircel shares through Joint Ventures with Deccan Digital Networks Private Ltd and Sindya Securities and Investments. These two Indian companies were controlled by Sunita Reddy, who belongs to Appolo Hospital Group.

The Maxis declaration itself could be a prima facie evidence to cancel the license of Aircel, apart from initiation of cases for cheating the Government. But even after six years of the deal, the Government has not acted on it. Reacting to violation of the Indian law by Maxis, Chidambaram said in the Rajya Sabha on Monday, “Let law take its own course.”

Maxis CEO stares at arrest, Interpol Red Corner Notice

May 21, 2012

In a new twist to the controversial Aircel-Maxis deal, the Indonesian Police has issued arrest warrant against Ralph Marshall, the CEO of Maxis Group and Astro All Asia Network. Ralph Marshall’s name figured as accused in the CBI’s FIR along with former Telecom Minister Dayanidhi Maran.

Indonesian newspapers, quoting top National Police official Brig M Taufik, recently reported that Marshall’s name figures in the Wanted List for cheating, forgery, fraud and money laundering.

Marshall, a Sri Lankan of Tamil origin, holds Canadian citizenship and is residing in Malaysia. He is considered No 2 in the vast business empire floated by the Malaysian tycoon T Ananda Krishnan, popularly known as TAK. Both figured as No 3 and No 4 in the CBI’s FIR along with Maran brothers in the Aircel-Maxis deal.

According to CBI, for facilitating the acquisition of Aircel by Maxis, Maran brothers received quid-pro-quo through Maxis subsidiary Astro. This company later invested around `600 crore in Maran brothers controlled Sun Networks, CBI’s FIR says.

“Headquarters of the Indonesian National Police (Police Headquarters) confirmed that the Chief Executive Officer (CEO) Astro Malaysia, Ralph Marshall, entered the Wanted Persons List (DPO ) related to cases of alleged criminal forgery. Determination of DPO was issued since 18 April 2012 through a letter numbered DPO/05/IV/2012/DIT General Crime (Pidum) signed Ari Dono Sukmanto Brig,” reported Indonesian newspapers Republica and Antara News, quoting Chief of Bureau of Public Information Headquarters, Brig M Taufik.

In Indonesia, Wanted Persons List is known as DPO (Daftar Pencarian Orang) and it is issued on fugitives after police fails to arrest them.

The Indonesian Police officials also said hey have already sent arrest warrant against Marshall through diplomatic channels to Malaysia. The top cops also added they would soon approach Interpol to issue Red Corner Notice against “fugitive Marshall” to force the member countries to arrest him.

The same was confirmed in Malaysian newspapers like The Edge, Business Times and The Malaysian Insider. “Indonesian Police are looking to arrest Ralph Marshall, the right hand man of Malaysian multi-billionaire T Ananda Krishnan, over fraud and money laundering charges,” reported The Malaysian Insider, adding a report on the forthcoming revamp of Maxis Group following criminal charges faced by Marshall.

Astro All Asia Networks is the subsidiary of Maxis and have shareholding in several media organisations across the continent including India. Astro has entered into an alliance with Indonesian media company Lippo Group and also has sizeable shares in it.

The problem started when Astro sold its shares to Saudi Global telecom, without consulting the Indonesian partner Lippo. The Indonesian police have charged Marshall with money laundering, fraud and forgery cases and sued him for a compensation to the tune of $300 mn.

“Their (Indonesian government) calculation is that if they can exploit the criminal law to cause confusion and fear, they can avoid paying the damages,” Astro’s lawyer Hafzan Taher said in the statement, reported by the Malaysian newspaper Edge.

CBI, which registered FIR, eight months ago has not been able to question foreign nationals Ananda Krishnan and Marshall. Last week, a CBI team visited Malaysia and sources say Attorney General of Malaysia promised “all help” in relation to Aircel-Maxis deal.

However, the probe on Maxis violating the Indian foreign investment rules has reached no where. According to norms, maximum permissible level of foreign investment in telecom sector is 74 per cent. Contrary to the FIPB records, Maxis’ declaration to Malaysian stock exchange reveals that they have acquired almost 100 percent shares in Aircel in violation to Indian laws.

Kerala's Politics of Violence

[This Op-Ed artilce published in 'The Pioneer' on June 2, 2012]

Being born and having lived in Kerala for 37 years, I often feel like laughing when home is described as “God’s own country”. This is how advertisement catch words infiltrate, invade and come to possess our minds. This decorative catch word was first used by Kerala Tourism’s advertisement campaign 15 years ago by, ironically, a Uttar Pradesh based Kerala cadre IAS officer — his name was Amitabh Kant.


We Malayalis lap up every honour, earned or otherwise, but are notoriously reluctant to recall perceptive albeit unflattering remarks made by distinguished observers. About 120 years back, Swami Vivekananda, while travelling through Travancore princely state, was horrified by the caste hierarchy in the province. He was so moved by the abuse of the backward communities by the self-styled “upper castes” that he left a label for Kerala which has somehow stuck — “lunatic asylum”.

Whether or not thanks to Swamy Vivekananda’s criticism, a process of change took momentum. This might have started the series of transformations in the social scene. Casteism, though still formidable, is today, in the second decade of the 21st century, a little less visible perhaps. “Progress”, as defined by Leftists and Marxist-Leninists, took shape through trade unionism and self-cleansing reform movements from the middle of the 20th century.

But the political arena failed to democraticise in the true sense of the term. Fractious caste politics, marked by a degree of violence matched only by the West Bengal experience, mocked the Malayalis’ claim to high status as a progressive people. Wherever the Communists went in India, they firmly planted the banner of “revolution” in the most convoluted sense of the term. To them, “change” meant destruction of body and soul of society, without a viable alternative in tow.

Thanks to the information revolution of the 1990s, the “little secrets” of Kerala politics have become national touchstones for political degradation. The brutal murder of Kannur schoolteacher and BJP leader Jayakrishnan Master right before his young students in December 1999 will always be counted as one of the lows of Indian democracy. Strangely, the CPI(M) defended the murderers all through.

The revelations of a district secretary, MM Mani, take the cake. This creature of Communist politics, did not think twice before boasting in full glare of TV cameras that his party

regularly used murder against political opponents. This only proves that somewhere in the corner of the collective Malayali mind, a devilish corner exists.

The Communist movement had a great impact in Kerala. The movement which started in the 1920s, worked through workers’ unions and caste relations reforms. But in northern Kerala, the citadel of Communism, nobody quite noticed the gradual barricading of the political consciousness. Though caste politics and religion based fundamentalism did not affect the core of the political scene, a much worse ogre consumed Kerala’s nascent democracy — Stalinism.

From the early 1970s on, it was quite usual to see people in Kerala die for their political beliefs. Stalinism and its alternative, Maoism, were fashionable among the generation of the mid-1970s, especially in northern Kerala. In their ignorance of the true nature of how these horrific ideologies actually played out, the Malayali perhaps mirrored the Bengalis. Both imitated systems they barely understood, rejecting, in the process, their own culture.

The “Calcutta thesis” of the Communist party in 1949, which sought for elimination of class (now read as political) enemies is still a fashionable theory in party classes of the CPI(M) in northern Kerala. As person belong to Thalassery in Kannur District, one of the birth places of Communism in Kerala I can vouch for this. The leaders of the party who dominated the discourse were fired by bloodlust. They justified every crime in the name of the party.

The character of the CPI(M) underwent change in the mid-1970s. The party decided to be strict towards the so-called “ultra-revolutionary movements.” CPI(M) elders from that era recall how dour party meetings suddenly became. Gone was the role of humour and sarcasm from in-door conferences. None would have a smiling face. The dangerous seriousness started shadowing in the internal meetings and smiling leaders became a rare species.

The murder of rebel CPI(M) leader TP Chandrasekharan early May exposed how deep the rot had set in. The exposition by Mani, which followed, therefore came as no surprise. He revealed the earlier planned eliminations of political opponents in the early 1980s in order to justify the murder of “renegade” Chandrasekharan.

The State Government, run by the Congress-led UDF, showed courage to initiate criminal action by reopening the old murder cases. But a big question hangs over the Congress’ will to take the matter to its logical end. Many feel that interest would die out after the current Assembly session is concluded.

Unlike West Bengal, where hard figures from the Home Ministry state that more than 20,000 people, the vast majority of them anti-Congress activists, were killed during the three decades of Communist domination. In Kerala, it is estimated that about 200 people lost their lives in politically motivated killings. The vast majority of these were victims of tit-for-tat murders committed in the never-ending turf war between the CPI(M) and the RSS in Kannur. Often times, the victims or perpetrators were Muslim League or Congress. But the CPI(M) has always been the constant. As a newspaper reporter in Kerala for more than 13 years, I have heard several Mani-kind of speeches by very senior CPI(M) leaders. Fortunately somehow Mani’s speech gone international and the law set in motion. I have often wondered, how is it possible for educated, talented and otherwise sensitive people to transform into murderers for narrow political profit? Distance from Kerala and experience in the north Indian scene, which is so vacuous of ideology, has opened my eyes to what I believe is the core deficiency of the Malayali mind.

His slavery - in body and soul — to the party line. Humanism pales before the party dictum. And also, the deep politicisation of society and every edifice of the state.

But today, thankfully, there is a silver lining. The crusader for political reform and former Chief Minister, VS Achuthanandan, has come out publicly against Mani. He has written a letter to the party leadership in Delhi questioning the morality of defending these actions. In the second week of June, we expect to see a thorough debate on this at AKG Bhawan in Gole Market. Unless of course, the self-deluding Malayali prefers to live in the lunatic asylum.

Manmohan's PPP model with tainted Ravi Rishi

[These articles appeared on 'The Pioneer on April 6 & 11, 2012]

Tatra- tainted Rishi has lion’s share in Govt’s expo hub


April 11, 2012

Controversial arms dealer Ravinder Kumar Rishi’s Vectra Investments is a major stakeholder in Central Government’s mega handicrafts hub and export venture, India Expo Centre and Mart. This project spread over 58 hectares in Greater Noida with 1,800 shops was inaugurated by Prime Minister Manmohan Singh in 2006.

According to statements submitted to SEBI by Rishi’s Global Vectra Helicorp, the India Exposition Mart Limited, where Rishi’s Vectra Investments has a 20-per cent share, is the biggest share holder in India Expo Centre & Mart. The Government, through Export

Promotion Council for Handicrafts (EPCH) under Textile Ministry, subscribed to 9.02 per cent share in this Rishi-controlled project, which operates across the world, dealing with handicrafts sale, export and import.

Apart from Vectra Investments and EPCH, the remaining stakes in the company are held by minority individual share holders on rotation basis, mostly the handicrafts exporters and traders basically from Moradabad.

Inaugurating the India Expo Centre on January 6, 2006, Prime Minister Manmohan Singh hailed this project as a classical example of Public-Private Partnership success.

“The Prime Minister complimented the Textile Minister for the performance of the industry and lauded its contribution to the export earnings as well as employment generation in the country. He also congratulated the promoters of the Mart and EPCH for timely completion of the project. He said that patterned on the PPP model, this Mart would set an example for many others,” said a supplement issued by EPCH in connection with the inauguration.

In lieu of its 9.02- per cent share, two Government nominees are on the board of this company having worldwide presence. A joint secretary in-charge of exports in the Textile Ministry and another official nominated by Development Commissioner (Handicrafts) are the two directors of the Rishi-controlled company. The records of the Registrar of Company show that after setting up the headquarters in Greater Noida, the India Exposition Mart Limited nominated on its board two officials from Greater Noida Industrial Development Authority.

India Exposition Mart Limited, where Rishi and his family members have controlling stakes, has either set up or is in the process of setting up centralised export centres in Dallas, Atlanta, Los Angeles, Utrecht in the Netherlands and Shanghai. Like in his other companies, in India Expo Mart also several retired Army officials hold key posts.

In Vectra Investments Private Limited, registered in Bangalore in 1997, which controls all Rishi’s ventures including the India Expo Mart, his close family members Deepti Rishi, Suruchi Rishi, Swati Rishi, Rati Rishi and Hemang Rishi are share holders along with him.

With Rishi on the CBI radar in Tatra truck deal, the disclosure will be embarrassing for the Government, which will find it difficult to explain why they selected him as a key partner in handicrafts development in local and international market when he did not have any expertise in the field.

Sources said CBI was probing Rishi’s proximity to suspended IAS couple Arvind Kumar Joshi and Tinoo Joshi. Recently investigators seized Rs 360 crore from the Bhopal residence of this couple. During 1999-2004, Arvind was a Joint Secretary level officer in Defence Ministry. More importantly, Tinoo was Development Commissioner (Handicrafts) during this period, when EPCH under her decided to partner with Rishi’s expo mart project.

Vectra’ Ravi Rishi no stranger to controversy

April 6, 2012-06-02

Arms dealer Ravi Rishi’s Vectra is not new to controversy. His companies were also at the centre of a scandal leading to the cancellation of the multi-billion Eurocopter deal for purchase of 197 choppers for the Indian Army in 2007.

Vectra’s subsidiary Global Vectra Helicorp is headed by one Lt Gen (rtd) SJS Sehgal, who was also a director of the Vectra Aviation, sole distributor of the Eurocopter choppers. He was also former head of the Army’s aviation wing. Incidentally, his younger brother, then serving Lt General HS Sehgal, was involved in the trials of the Bell and Eurocopter choppers for more than a year to select the bidder.

The deal was cancelled after Bell complained to the Ministry of Defence on the role of Sehgal brothers and Rishi’s companies in trying to swing the deal in favour of the Eurocopter.

Hoping to get the deal in favour of Eurocopter, at one point Vectra Aviation was planning to set up a Maintenance, Repair and Overhaul (MRO) for Eurocopter choppers in India at an estimated investment of 6 million Euros.

In their complaint, Bell pointed to the clash of interest and role of middlemen. It cited that younger Sehgal was involved in the field evaluation and preparation of trial reports for the two helicopter companies whereas the senior Sehgal was lobbying for Eurocopter .

However, Rishi’s name did not figure in the controversy as media focus remained on the two brothers.

A series of financial statements filed by Rishi in 2006 to SEBI for floating IPO for Global Vectra Helicorp shows that several retired top Army officials were associated with the slew of companies floated by him over the past 14 years. Apart from this several retired middle level officers from the forces and their relatives are holding managerial positions in Rishi’s companies.

Lt General RIS Kahlon, who recently passed away, was the Director of Tetra Trucks India Limited and Vectra Advanced Engineering.

Montek's doubtful games on Rail and Road

[These two articles appeared on 'The Pioneer' on March 19 & 21, 2012]

US loco giant pits Montek against planners


March 19, 2012

In the midst of political turmoil over the railway fare hike, an intense fight is going on in higher echelons of bureaucracy over the selection of bidders for two locomotive factories that then Railway Minister Lalu Prasad Yadav had announced for his parliamentary constituency in Bihar in 2009. In the 2009 Railway Budget, Lalu had announced setting up of one electric locomotive factory at Madhepura and another diesel loco factory in Marhowra on PPP model.

The process of selection of bidders has pitched two key Ministries — Railways and Finance — against the Planning Commission. Top officials of Railway Board and Finance Ministry have objected to the proposals of Plan panel to change the Cabinet-approved bidding process and supply conditions for these two pending projects, which have reached nowhere in three years.

The official communication and file notings available with The Pioneer show that top officials of Railway Board and Finance Ministry protested over the changing of the Cabinet decisions to favour certain bidders by Plan panel deputy chairman Montek Singh Ahluwalia’s Advisor Gajendra Haldea. For executing the bidding process, the Cabinet in 2009 formed an Empowered Committee consisting of officials drawn from Railway Board, Finance Ministry and Planning Commission. The controversies started when Haldea mooted some changes last year in the Cabinet-approved proposal.

In case of Madhepura project, senior officials of the Railway Board and Finance Ministry noted down that the minutes of the meeting were also “changed” and “misquoted” to propose major changes in the bidding documents to favour the US giant, General Electric.

In a series of communications between the Empowered Committee members, Finance Ministry and Railway Board officials have stated that Haldea’s proposal to change the Cabinet approved bidding procedures and supply conditions would place an extra burden of more than Rs16,405 crore.

Sources told The Pioneer, in several meetings of the empowered group, heated exchanges took place and some members alleged that these changes were introduced to suit General Electric — the lone bidder for the project. In the bidding process of Marhowra project also, top officials of the Railways and Finance Ministries protested Haldea’s high-handedness. “Haldea apparently thinks that India is a Banana Republic that can be forced to accept a con game….,” noted Sanjiv Handa Member (Mechanical) of Railway Board in a note seen by the Railway Board Chairman.

In the same note, Additional Member (Production Unit) SK Sharma of the Railways wrote that “it is unfortunate that professionalism, probity and regard for highest standards of integrity of the mechanical directorate are being questioned by resorting to sensationalism, misinformation and slander, rather than reasoned debate. It is for the investigators to determine whether this was part of a larger agenda aimed at compromising the Indian Railways interest.”

The Finance Ministry officials also expressed displeasure on changing of Cabinet-approved bidding and supply conditions. A Railway Board note of June 28, 2011 read, “Economic Affairs Secretary R Gopalan specifically asked financial commissioner the decisions of the Empowered Committee at the behest of the bidders will need to be seen with regard to their financial aspects so as to ensure that gaming by the bidders is ruled out and Railways interest will not be compromised. The minutes do not include these concerns of the Secretary, Economic Affairs.”

In a communication to Montek on February 9, Planning Commission Member Secretary Sudha Pillai questioned the authority of Haldea for approving the changed proposals, which he himself mooted. “Subsequently, several amendments that were proposed to the terms approved by the Cabinet were also admittedly authored by him. These proposals altering the terms of the proposed contracts in significant ways were quickly endorsed by the Infrastructure Division (headed by Haldea), bypassing me on some occasions.

“However, these amendments when subjected to detailed discussion and scrutiny by the Empowered Committee were found to have serious implications which had not been adequately addressed. It was clear that these amendments were not subjected to independent and impartial scrutiny. This created a very embarrassing situation for me as a member of the Empowered Committee,” said Sudha Pillai in a communication to Montek.


Plan panel tweaks toll to favour developer

March 21, 2012

Ignoring the directions of Supreme Court’s Monitoring Committee and overruling strong objections from Planning Commission Members, the plan panel has approved a 1.5-time increase in toll rates for Eastern Peripheral Expressway. This increase was proposed by CP Joshi, Minister for Road Transport and Highways, and the proposal was mooted by Deputy Chairman of the Planning Commission Montek Singh Ahluwalia’s advisor Gajendra Haldea.

The documents available with The Pioneer show that on several occasions, NHAI (National Highway Authority of India) officials objected to the proposal to increase EPE toll rates and said it was an attempt to help the developer of Western Peripheral Expressway (WPE), whose toll rates were less. The decision to create these two expressways followed a Supreme Court order in 1984 on a Public Interest Litigation on heavy traffic congestion and frequent road accidents in Delhi.

The WPE starts from Kundli and via Manesar, it reaches Palwal. The EPE too starts from Kundli and via Bagpat, Gaziabad and Noida, it reaches Palwal. Both expressways meant to de-congest Delhi have equal length of 135 km and were decided to be constructed on Build Operate Transfer (BOT) system.

The implementing agency of WPE, also known as KMP (Kundli-Manesar-Palwal) is the Haryana Government-run HSIIDC. The developer of this expressway is DSC Limited, owned by HS Narula and MS Narula. The construction started on 2007 and was supposed to be completed by 2010. But till date only 60 per cent of work has been completed, and it may take three more years for fruition. The toll rate of a car fixed for WPE is Rs 170.

The EPE’s implementing agency is Central Government’s NHAI. The project is still on paper and even bidding process has not started. Ignoring the direction of the Supreme Court-appointed Monitoring Committee, the new toll policy, which came into existence in 2008, raised the toll rate of EPE for cars to Rs 230. NHAI officials and Finance Ministry on several notes observed that the toll rates of the WPE and EPE should be equal.

“The toll rates of WPE and EPE should be kept at par to ensure that there is no diversion of traffic along WPE. Higher toll rates of EPE will lead to diversion of traffic towards WPE resulting in non-viability of the project and undue benefit to the concessionaire (DSC Limited) of WPE,” said an NHAI communication to Ministry on December 3, 2010, citing the direction of the SC’s monitoring committee.

One year ago Montek’s advisor Gajendra Haldea, who rules the roost in the powerful Infrastructure Division, mooted the proposal to the Road Transport and Highways to treat the EPE as a bypass. This was a clever ploy by Haldea, because as per the new toll policy, toll rates for a bypass can be 1.5-times higher than expressways. Sources say, after CP Joshi became the Minister of Road Transport and Highways, this proposal gained momentum. Several engineers objected to this proposal and said EPE was a new expressway and a 135-kilometre road could never be treated as bypass.

Treating the EPE as a bypass and increasing the toll rate 1.5 times would cost a car Rs 340 to cross the EPE, while the WPE, which has equal length, has only Rs 170 as toll for the same vehicle. This would lead to two situations. First, all the traffic would divert to WPE. Second, no bidder would come for construction of EPE, and give complete traffic monopoly to WPE. Strongly objecting to this dubious proposal, which clearly intends to favour the developer of WPE, Planning Commission Member BK Chaturvedi wrote to Montek that this proposal should go to Cabinet Committee on Infrastructure (CCI) for approval.

“If the PPPAC (Public Private Partnership Appraisal Committee) are to be overturned and matters which are delegated to it are to go to Cabinet afresh, we might as well abolish the PPAC….if higher toll rates are charged, naturally the bids will be better. But to that extent, people will be taxed more. There is also the worry that its usage may get limited and the purpose of making the bypass may not fulfilled.

“In view of above, I do not agree with the proposal in principle to review any decision of the PPPAC unless there is mala fides intension in it. I find none in the instant case. I feel that the project has already been delayed and we should go ahead with the current process,” said Chaturvedi on February 1, 2012.

Agreeing with Chaturvedi’s observations, Commission’s Member Secretary Sudha Pillai in a note to Montek on the very next day blamed Haldea for misquoting her. “I must also place on record my objection to the statement at para 9 of the note of Advisor to DCH (Haldea)…that I have supported the higher rate of 1.5 times. ….imposition of a higher toll rate will be contrary to Government policy and will not be in public interest…..The EPE is not a bypass but an Expressway….the draft OM (Office Memorandum) placed below is premature and full of wrong reasoning,” she wrote.

But after 11 days, ignoring the views of Finance Ministry officials and NHAI engineers and overruling the objections of his colleagues, Montek approved the dubious proposal mooted by Haldea to increase the toll rate of EPE, which would help the developer of WPE.

However Minister RTH (CP Joshi) has decided to take a different view which he is entitled to do. PPAC is an official level committee and Minister is not bound by it in going back to the Cabinet…..I feel we should apply the relevant rule, but we have to leave it to the Ministry to decide whether it is indeed a bypass.

“The Ministry has proposed treating it as a bypass and applies the relevant rule. Planning Commission concurs with the proposal,” wrote Montek on February 13, 2012, giving green signal to increase the toll rate of EPE. This literally makes EPE non-viable and offers a bumper bonanza to DSC Limited, the developer of Western Peripheral Expressway.

Investigators go easy on US-indicted middleman Sanjay Pasari

[This report published in 'The Pioneer' on December 7, 2011. Everybody talk on blackmoney stashed in foreign banks. But no action from India, even while foreign governments and courts fix such Indian illegal account holders]

Indian investigating and enforcement agencies have not cracked down on a politically connected middleman even after the US counterparts provided them with details of his ‘frozen’ unaccounted deposit of around $400 million in several Swiss Bank accounts.

The middleman, Sanjay Pasari, operating mainly in the coal and mining sector, was implicated by the US Justice Department and Securities & Exchange Commission in late 2010 in a probe related to bribing of Indian officials, while acting as an agent of multinational mining giant Bucyrus, which has now merged with Caterpillar.

A Geneva court order passed on February 16, 2011 upon the alert issued by US authorities under International Criminal Mutual Aid, froze (probative sequestration) accounts of Sanjay Pasari (No. 2952334), his brother Rajiv Pasari (a/c no : 1996090), their firm Savan Foundation (a/c no : 1159024) and his company Infotech Guernsey (a/c no : 189502) at Lloyds TSB Bank in Switzerland.

The court order available with The Pioneer shows that the Swiss Government also blocked accounts linked to Pasari in the name of Vishwa Industrial Co Pvt Ltd, VT Industries Ltd Squirrel Developers, Niraj Kumar Pasari, Davind Lee, the former director of Bucyrus’ Indian subsidiary and CET Consulting Engineering Trading Anstalt Vaduz.Most of these companies are registered in Pasari’s home turf, Kolkata.

Even after getting such sensitive and concrete information of huge black money stash of an Indian citizen in foreign banks, the Government here has done precious little to proceed against Pasari. The CBI has only issued alerts to Ministries connected with coal, mining, steel and fertilisers by placing Pasari on the ‘Undesirable Contact Men’ list, which warns Government officials to avoid contact with such persons.

The Government’s inaction against Pasari comes in the backdrop of the fact that he is closely associated with political heavyweights, including a former Cabinet Minister in the UPA-I and politicians from Bihar, Jharkhand, Maharashtra, Chhattisgarh and the North East. “US authorities are in the process of also seizing his accounts in Dubai, London, Mauritius and Guernsey Islands. By mid-2012, US authorities would finish the seizure procedures in London,” said a highly placed official.

Pasari’s name also surfaced in Madhu Koda’s scam, following which the Enforcement Directorate had also initiated probe against him. In 2006, he was wanted in some cases when Jharkhand cracked down on illegal miners, added a source. Pasari’s role in bribing Indian PSUs and their officials first was detected by the auditors of the Caterpillar engaged for finalising Bucyrus merger with it. When Pasari was questioned by US authorities, he is reported to have admitted of paying $ 2 million as bribe on behalf of Bucyrus to officials of a coal sector PSU during 2009-10 for striking a big mining deal. Pasari made this disclosure under the Foreign Corrupt Practices Act of America, according to sources.

Pasari was also asked to submit all documents and bank accounts relating to his operations. According to documents available with The Pioneer, apart from Coal India, Pasari has dealings with several PSUs like National Mineral Development Corporation, Bharat Earth Movers, Power Finance Corporation and McNally Bharat Engineering Company Ltd.

“The US investigations proved that he had parked ill gotten wealth in all tax havens across the world. He even formed charity organizations like Savan Foundation for alleged money laundering,” said sources. Savan’s account has also been frozen in Switzerland.

According to the notice served by US investigators, Pasari operated from three locations — 62A Hazara Road, Kolkata; B-21 Rashidiya. PO Box 51031, Dubai; and Anson Court, Les Campus, St.Martin’s in Guernsey Island, a British crown dependency in the English Channel.